This course examines the interplay between individual behavior, political institutions, and public policy through the lens of behavioral economics and social psychology. We will explore how psychological biases, heuristics, and cognitive limitations influence political decision-making processes, both on the side of voters and policymakers. We will critically assess the implications of these behavioral insights for the functioning of democratic institutions in the digital age, focusing especially on the challenges posed by misinformation, political polarization, and the rise of behaviorally informed governance.
Last update: Špecián Petr, Ing., Ph.D. (19.06.2024)
Aim of the course
By the end of this course, students will be able to:
Understand core concepts of behavioral economics and their applications to political phenomena. This includes understanding heuristics, biases, framing effects, prospect theory, and other key behavioral concepts.
Analyze the relationship between individual rationality and collective choice in the context of democratic politics. We will explore how individual biases can aggregate into collective outcomes, potentially leading to suboptimal policies and democratic instability.
Critically assess the promises and pitfalls of behaviorally informed paternalism as a policy approach. This includes understanding the ethical and political ramifications of nudges, shoves, and other forms of behavioral interventions.
Evaluate different institutional reforms proposed to enhance the resilience of democracy to political irrationality. We will consider proposals such as boosts, budges, quadratic voting, and open democracy in light of their potential to mitigate the harmful effects of irrationality while preserving democratic values.
Develop and articulate informed arguments about the future of democracy in the digital age. This entails formulating well-reasoned arguments based on empirical evidence and theoretical frameworks covered in the course.
Last update: Špecián Petr, Ing., Ph.D. (19.06.2024)
Course completion requirements
Class Participation (20%): Active and informed participation in class discussions.
Nudge in the Wild (40%): Students will identify and analyze a real-world example of choice architecture in action. This could be a nudge (or sludge!) employed by a business, government agency, or other organization. They will present their analysis in a short midterm paper that applies the concepts and frameworks covered in the course.
Democratic Design Challenge (40%): Working in small groups, students will choose a specific challenge facing modern democracies – this could be misinformation, political polarization, low voter turnout, climate change inaction, etc. They will then apply the principles of behavioral political economy to develop a creative “mechanism design” solution that addresses the chosen problem. The final deliverable will be a group presentation and a short policy memo (5-7 pages) outlining the problem, the proposed solution, and its justification.
Last update: Špecián Petr, Ing., Ph.D. (19.06.2024)
Literature
Špecián, Petr. 2022. Behavioral Political Economy and Democratic Theory: Fortifying Democracy for the Digital Age. Routledge Frontiers of Political Economy. New York, NY: Routledge. (Referred to as Špecián in the syllabus)
Thaler, Richard H., and Cass R. Sunstein. 2021. Nudge: The Final edition. New York: Penguin Books. (Referred to as Nudge in the syllabus)
Last update: Špecián Petr, Ing., Ph.D. (19.06.2024)
Syllabus
Part I: Foundations
Week 1: Introduction: The Challenge of (Political) Irrationality
Discussion: What is (political) irrationality? Why should we be concerned about it? How can rationality's bounds be used to influence behavior?
Week 2: The Economic Approach to Human Behavior: From Econs to Humans
Readings: Špecián, Chapter 1. Nudge, Chapter 1.
Discussion: How do behavioral and neoclassical economists approach rationality differently? What are some common biases and heuristics that influence human decision-making?
Week 3: Democracy and Rationality: The Problem of Social Choice
Readings: Špecián, Chapter 2 (until "The Problem of Rational Ignorance and the Wisdom of Crowds"). Arrow, K.J. (1963). Social Choice and Individual Values. (excerpt)
Discussion: What is the problem of social choice? How does Arrow’s Impossibility Theorem challenge our understanding of democratic decision-making? How do we balance individual preferences with collective decision-making?
Part II: The Digital Age and its Discontents
Week 4: The Problem of Rational Ignorance and the Wisdom of Crowds
Readings: Špecián, Chapter 2 (from "The Problem of Rational Ignorance and the Wisdom of Crowds"). Nudge, Chapter 3.
Discussion: Can democracy work well despite voters’ ignorance? What is "the wisdom of crowds"? When can it emerge and when is it undermined?
Week 5: The Republic of Misinformation: Victims & Opportunists
Readings: Špecián, Chapter 3 (until "A Question of Agency"). Nudge, Introduction and Chapter 15.
Discussion: Does social media help or harm democracy? How can disinformation impact collective decision-making? What are the ethical considerations of nudging in a context where people are vulnerable to manipulation?
Week 6: Beyond the Victim Narrative: Rational Irrationality and Politically Motivated Reasoning
Readings: Špecián, Chapter 3 (from "A Question of Agency"). Kahan, D.M. (2017a). Misconceptions, Misinformation, and the Logic of Identity- Protective Cognition. (excerpt)
Discussion: How do social influences impact our beliefs and decisions? Can we understand fake news consumption as a form of rational irrationality? How does motivated reasoning influence our interpretation of political information?
Part III: The Psychological State and Its Alternatives
Week 7: Behaviorally Informed Paternalism, True Preferences, and the Sovereignty Principle
Readings: Špecián, Chapter 4. Nudge, Chapters 1 and 15.
Discussion: What is behaviorally informed paternalism? What are the pros and cons of relying on behavioral-paternalist measures? How do we balance the potential benefits of nudges with concerns about individual autonomy and government overreach?
Week 8: Fortifying Democracy for the Digital Age: Marginal Reforms – Boosts and Budges
Discussion: Can we use "boosts" and "budges" to address political irrationality without resorting to paternalism? What are their limitations? What are some examples of their effective use in policy context?
Week 9: Radical Reforms: Quadratic Voting
Readings: Špecián, Chapter 5 (from "Democracy Remodeled: Radical Reform" until "Open Democracy"). Posner, E.A. and Weyl, E.G. (2018). Radical Markets: Uprooting Capitalism and Democracy for a Just Society. (excerpt)
Discussion: Can we design institutions that better reflect the intensity of people’s preferences? How does quadratic voting address the limitations of traditional voting systems? What are its strengths and weaknesses?
Week 10: Radical Reforms: Open Democracy
Readings: Špecián, Chapter 5 (from "Open Democracy"). Landemore, H. (2020). Open Democracy: Reinventing Popular Rule for the Twenty-First Century. (excerpt)
Discussion: What are the key features of open democracy? Can it provide a more resilient institutional framework for democratic decision-making in the digital age? How can deliberation enhance the quality of collective choice?
Week 11: The Anti-Psychological State: Integrating Reforms
Discussion: Can we combine different reform proposals to create a more resilient and responsive democracy? What are the potential synergies and challenges? How can we facilitate institutional reform?
Conclusion: The Future of Democracy in the Digital Age
Week 12: All Bets Are Off: Generative AI on the Scene
Discussion: Could Generative AI be used by governments to create more effective behavioral policies, such as personalized nudges? How might Generative AI impact the viability of different democratic reforms?
Last update: Špecián Petr, Ing., Ph.D. (19.06.2024)
