Rethinking Economics: Downs with Traction
Abstract
Economic theory has relatively little to say about the policy making process. One exception is Anthony Downs’ An Economic Theory of Democracy which considers possible objectives for participants in the political process, and develops propositions on the operation of a democracy. Two key assumptions were no false information and no irrationality. As he acknowledged, neither is realistic. There is extensive literature, including writing by Adam Smith on rhetoric (deliberative eloquence) in political debate, and the significance of propaganda was recognised in the 1940s. Modern approaches to political processes, agenda setting, and discourse analysis also emphasise persuasion and framing.
This paper builds on Downs’ foundation by relaxing his assumptions. First, there is consideration of the nature of rhetoric, including “macro-rhetoric”. The effects of rhetoric on policy debate, and the importance of “traction” on political agendas are then considered. Propositions are presented indicating, in particular: policy issues will only be addressed spasmodically; few options will get attention; and there is likely to be poor monitoring. Consideration is then given to implications for economists and their approaches to policy.