Why did Corbyn do so well? A little bit of political economy

Let's assume the exit poll is about true, and that Jeremy Corbyn has done even better than the polls thought – and he was already pulling far ahead of what people, including me, expected.

There are lots of things to say about this: failures in polling (again); Theresa May's incompetent campaign and feeble personality; Jeremy Corbyn's quality as a campaigner; the role of the internet.

I think one dog that very importantly did not bark is the Labour manifesto. Remember, Jeremy Corbyn is a passionately ideological Leftwinger. But the manifesto was in many ways rather moderate. It did not, for example, aim to spend much more than the Conservatives. It did not set out to reverse many Conservative welfare cuts.

A classic model in political science explains why parties move to the centre. Suppose the two parties are concerned only to win the elections. They will each promise a platform right in the middle of the electorate, at the famous "median voter" - the person in the middle, who has half the electorate to the left of her and half the electorate to the right. Why? Because if one candidate moves to the left of this person, then (at least!) everyone on the right votes for the other candidate, who wins a 50% majority. And if one candidate moves to the right, then everyone on the left votes for the other candidate who again wins.

Here's an ASCII art picture. It shows a line representing political preferences from Left to Right. The voters are at x. The median voter is marked with a *, with two voters on her left and two on her right. Voters vote for the party that is closest to them. Both parties will propose a platform at *. Any party that moved left or right would get three voters preferring the other candidate.

____________x_______x_______*___x_________________x_________

A natural response to this is "oh, but politicians are idealists! Or at least, Jeremy is. Jeremy cares about policy, not just getting elected." Well, stop swooning over Jeremy for a second, and suppose that is true. Suppose you are Jeremy Corbyn and deeply want policy to be as left wing as possible. You will still move to the centre. For, if you do not, and lose, then you will get the policies implemented by your right wing opponent.

This seems to be what has happened. Corbyn moderated his manifesto. That made Labour palatable to voters who would never have tolerated Corbyn's own ideal policies.

In a sense, you could say that despite appearances, the ghost of Blair still haunts the Labour party. Even with Corbyn as leader, they are forced to go along with a lot of the consensus of the past forty years.

(Thank God! ... But this is a post about the "horse race", not the outcome.)

References
The original model of the median voter is the "Downsian" model, made famous by Anthony Downs' An Economic Theory of Democracy (1957); but actually first suggested by Hotelling (1929) "Stability in competition". The point about "idealistic" politicians was first made, I think, by Donald Wittman (1929) "Candidates with policy preferences: A dynamic model" – sorry no ungated version.

An anecdote from a teacher friend

(Paraphrased.)

“I caught a pupil of mine cheating on his history coursework, he’d copied it wholesale. So I told him he couldn’t take his A level. First my boss comes in and asks me to reconsider. I say no. So then my boss comes back with the boy and asks me to reconsider. I say no. Then my boss’s boss comes in with the parents, and ask me to reconsider. You see, the school’s results will look bad if we don’t let him take the exam I say no. Finally, my boss’s boss’s boss comes in. I still say no. I like the kid as a person, but he shouldn’t have cheated."

What lessons can we draw from this? First, obviously, misused incentives are as toxic in the education system as elsewhere. Second, it is an example of how difficult (but crucial!) honesty can be. It involves the drawing of clear lines in a story full of shades of grey. I’m sure the kid was nice, I’m sure his parents thought up excellent reasons why his future shouldn’t be harmed by this one mistake, and that the head teacher made the same eloquent arguments, I bet nobody was crass enough to say “we can’t make our exam results look bad”. I equally bet that nobody pointed out the consequence - which is, after all, highly diffuse, distant and uncertain - that if we turn a blind eye to large-scale cheating, our education system will cease to do its job.

More abstractly, I think this anecdote shows that the theory of repeated games is very misleading as a guide to the social science of ethical behaviour.

Let’s recap: numerous “folk theorems" show that if a situation is repeated often enough among the same group of actors, they can achieve almost any outcome, including efficient outcomes (roughly, those which are best for everyone), by punishing bad behaviour in future rounds of play. This has often been taken as a parable for real world. If only people can interact often enough in stable communities, then they will force each other to do the right thing. So, for instance, Coleman (1988): “Social capital in the creation of human capital”. Or Elinor Ostrom passim. Or Ellickson, Order without law, about midWestern ranchers.

Unfortunately, no. Look at the story. Everyone around my teacher friend is persuading him to do the wrong thing. People in the relevant community have interests that are misaligned with that of the wider society. The pressure they bring to bear is making outcomes worse, not better, and only my friend’s strong personality bears up against them. This will be typical in any social system larger than Hillary Clinton’s proverbial village. To function well, large societies need internalized moral rules, not just social pressure.

Dishonesty in the US military

This paper is a great sourcebook:

Every contact with the enemy required a storyboard. People did not report enemy contact because they knew the storyboard was useless and they didn’t want to go through the hassle.

It’s odd that in situations that I’ve been in, it’s never been blatant self-interest. It’s never been, “I’m going to get this money so I can buy myself two couches for my office while I’m in Afghanistan.” [Instead], it’s always like—for us, it was hard as hell to get water heaters.... [W]e had to say we’re using this for this, when in fact it was so our guys could have hot showers when they get back off patrol.

I falsified the [traumatic brain injury] report that changed a distance from the IED strike [to where] one person was standing. So that way someone didn’t come back down and stick a finger in my CO’s chest and say, “You need to evac that lieutenant right now!” Because in the middle of [a] RIP, that’s not going to happen. If I do that, I’m going to put my boys in bags because they don’t have any leadership. That ain’t happening. I owe the parents of this country more than that.

Grade inflation

The media has noticed the problem of grade inflation in UK degrees (BBC, Telegraph). There are now twice as many first class degrees being given out as there were ten years ago (for non-UK readers, a “first” is the best degree grade).

The economics of this seems clear. A university that gives better grades to its students benefits them in the job market, and also looks better in league tables that count the number of grades students get. It also devalues that university’s degrees, but, since most UK employers cannot distinguish between universities except perhaps Oxbridge at the top, this devaluation is a “public bad” which is shared with all universities... and also with past and future students, neither of whom the short-term-focused administration cares about. Result: grade inflation.

This story is true as far as it goes, but it misses something important. Grades are given by the academic staff who do marking. None of us benefits directly from inflating our students’ grades. The benefit to the university is a public good for each individual academic: why should I care about my university’s score in the rankings?

The real cause of the change is not pure self-interest, but a combination of “bounded ethicality” and its exploitation. I feel loyal to my colleagues in my department, and to my university; whereas UK education as a whole is too abstract and remote to care about. And then, these feelings are played on by the administration. A memo comes round about “using the top end of the grading system more” so as “not to short-change our students”. Your colleagues knuckle under – after all, everyone else is doing it. If you rock the boat or grade too low, then you are told not to make trouble. In this way, a new norm is developed. We shift our ideas about what constitutes first class work, just a little at first....

This is typical. Selfishness is not just about the breakdown of norms; new norms are also created. As Thucydides put it:

Words had to change their ordinary meaning and to take that which
was now given them. Reckless audacity came to be considered the courage of a loyal ally; prudent hesitation, specious cowardice; moderation was held to be a cloak for unmanliness; ability to see all sides of a question, inaptness to act on any.... (3.82)

The promising side of this is that, in economists’ terms, there are multiple equilibria. Individuals will always be tempted by selfishness; but an organization can only act selfishly if the individuals in the organization tolerate this. When the greater society has a strong claim on people’s affections, it is possible to resist organizational selfishness. Let’s hope that UK academics recognize this, and try harder to uphold our standards in future.

Ethics committees

Every piece of university research involving humans has to go through an ethical approval process, typically handled by a committee.

History shows plenty of examples of horrendous research on humans. So surely ethics committees must be good things? Mmm... I am not convinced.

Ethics committees check every piece of research for problems before it starts. This is not the only approach to prevention. Some transactions on your local high street may be deceptive, but trading standards bodies do not check every transaction before allowing it. Closer to home, there is a danger of fraudulent research, but we do not check every piece of research for fraudulence. Instead we deal with problems by after-the-event sanctions and trust them to have incentive effects.

Scholars studying political oversight of bureaucracies talk about “police patrols” versus “fire alarms”. Police patrols check things ex ante; fire alarms go off only when there is a problem – for example, when a constituent or lobbyist raises a complaint. Police patrols have their advantages, but they can be massively expensive and cumbersome. Ethics committees are police patrols.

As well as imposing transaction costs, there is a danger that ethics committees go beyond their remit and try to control what research gets done. Ought their terms of reference not stop this? Perhaps in theory. In practice, often the ethical risks of a particular experiment must be weighed against the benefit of the research. But this is a backdoor, which allows committees to consider what is good and bad research.

The (nice and helpful) people on my last panel assured me that many researchers found that discussions with them improved their research design. Undoubtedly that was indeed true, but it is just the problem. If you are having that kind of discussion with a body which can allow or ban your research, then you have lost the ability to judge for yourself what research is worth doing. The benefits accruing to perhaps to 99% of researchers will be outweighed by the loss from the 1% with an innovative idea that, like many such ideas, meets resistance from the status quo.

In Germany, there are essentially no ethical review requirements, at least for social science research. I strongly suspect that a sample of German research and UK or US research would find no statistically significant difference in the level of ethics violations. Ironically, I can find  no evidence base for the positive effect of ethical review on the ethical quality of social science (though there seems to be plenty on its effects on speed of research etc.)

As I have brought up the German case, you may now wish to mention Nazi medical “research” and Josef Mengele, perhaps the wickedest pseudo-scientist in history. Be careful with that argument. Do you really think that the problem with Mengele was insufficient oversight by an ethics committee? The Nazis would have controlled the committee too, because they had taken over German universities. One reason they were able to do so, I suspect, was that German academia were highly centralized and authoritarian. So, if you want to protect academia against the effects of tyranny, make sure it is decentralized and free. Ethical review processes may risk doing the reverse.

(PS: the new Essex Social Science Experimental Laboratory will scrupulously follow the University’s ethical guidelines, and all research conducted in it will have passed ethical review, as well as the Lab’s own strict rules banning deception. These are just my personal opinions.)