When I read Daniel Klein’s WSJ piece on the state of basic economic knowledge among American adults, I had to wonder how anyone could be surprised by his findings.
Who is better informed about the policy choices facing the country — liberals, conservatives or libertarians? According to a Zogby International survey that I write about in the May issue of Econ Journal Watch, the answer is unequivocal: The left flunks Econ 101.
Zogby researcher Zeljka Buturovic and I considered the 4,835 respondents’ (all American adults) answers to eight survey questions about basic economics. We also asked the respondents about their political leanings: progressive/very liberal; liberal; moderate; conservative; very conservative; and libertarian.
Rather than focusing on whether respondents answered a question correctly, we instead looked at whether they answered incorrectly. A response was counted as incorrect only if it was flatly unenlightened.
Americans in the first three categories do reasonably well. But the left has trouble squaring economic thinking with their political psychology, morals and aesthetics.
The survey also asked about party affiliation. Those responding Democratic averaged 4.59 incorrect answers [out of 8]. Republicans averaged 1.61 incorrect, and Libertarians 1.26 incorrect.
The eight propositions polled in the survey were:
- Restrictions on housing development make housing less affordable.
- Mandatory licensing of professional services increases the prices of those services.
- Overall, the standard of living is higher today than it was 30 years ago.
- Rent control leads to housing shortages.
- A company with the largest market share is a monopoly.
- Third-world workers working for American companies overseas are being exploited.
- Free trade leads to unemployment.
- Minimum wage laws raise unemployment.
Before you go off half-cocked about bias in the survey (I’m looking at you, progressives), read the damn thing first.
Most notably, the study found that the more economics classes a person took, the more likely he or she was to be a member of the Republican Party and to donate money to a political candidate or a cause.
The study also gathered responses to seven questions about public policy issues, such as tariffs, trade deficits, the minimum wage and oil prices. On five of the seven, the authors found a link between the opinions expressed and the number of economics courses the respondents had completed.
The more economics courses they had completed, the more likely they were to agree that tariffs reduce economic welfare and that increases in the minimum wage raise unemployment, and the less likely they were to think that trade deficits adversely affect the economy and that government should regulate oil prices.
“In sum,” the study said, “those taking more economics classes favored less regulation or government intervention affecting prices for specific goods and services, including wages and salaries.”
Here’s the study:
Again, I’m stunned. What a surprise. This is my shocked face.