Research shows the value of deliberation in polarized times

Name-calling seems to be something that comes with language, whether we like it or not. A common response by children years ago, before cyber-bullying, was in a rhyming rejoinder, “Sticks and stones may break my bones, but names can never hurt me.”

There was no truly satisfactory adult form of that response — which is just as well, for it isn’t clear that names can never hurt us. In fact, the development of social media has meant that today’s name-calling isn’t limited to school yards. It now has easy access to global reach and is a weapon capable of breaking our spirit.

For all that, is name-calling capable of damaging our economy? Common sense would tell us that it is, but sadly we don’t yet know because we cannot yet measure it. For the most part, in today’s economics, if something isn’t measured it really doesn’t exist. Of course, common sense isn’t measurable either so its role in economic theory or policy is, at best, indeterminate.

Seeing the importance of social media, and its name-calling, economic researchers have begun to explore ways to learn more about its impact on the economy — whether it is directly measurable or not.

One of the initial problems that economic explorers face is that social media contains wildly diverse elements that range from schoolyard-level taunting and name-calling to timely, important information.

The social media mix itself echoes political speech, which has reintroduced absurdity into its language. Superlatives abound, but now we have something that resembles a comparative-superlative hybrid. Individuals are “worse than Hitler,” for example, as if merely being Hitler’s equal wouldn’t be quite enough.

The impact of these words, however, isn’t clear. We would think that the constant flow of pejoratives, insults, and hyperbolic comparisons would tend to affect the outlook of consumers, for example, but that conclusion had never been subjected to rigorous analysis.

Under the assumption that political rhetoric and social media tended to segregate people’s opinions, researchers at the New York Federal Reserve examined the data they had collected in its Survey of Consumer Expectations (SCE) to see if polarization affected consumers’ outlook.

Entitled, “Political Polarization in Consumer Expectations,” the three researchers, Oliver Armantier, John H. Conlon, and Wilbert von der Klaauw, examined the SCE survey data and compared the expectations of voters in Democratic counties with those in Republican counties—their affiliation determined by whether they voted for Donald Trump or Hillary Clinton.

What they found was that for at least two years, “polarization predated the election,” and that Democratic counties were more optimistic about the future than Republican counties. After the election, as we might expect, Republican counties were more optimistic than their Democratic counterparts. That makes sense, but there is one aspect of the data that is difficult to explain. The Democratic counties didn’t become less confident. It turns out that, as the authors note, “both groups became more optimistic after the election.”

Like all good exploratory research, the New York Federal Reserve study raises more questions than it answers. Political analysts will certainly want to understand why losing an election would raise consumers’ optimism. And in the broader, economic theory sense, at a minimum, we need to know more about the relationship between elections and consumer expectations. Then, perhaps we can get a better handle on how polarization affects consumer outlook.

Another good example of exploratory research in this area of the effects of language may be found in a report, “Can Words Get in the Way? The Effect of Deliberation in Collective Decision-Making.” The authors, Matias Iaryczaower, Xiaoxia Shi, and Matthew Shum — of Princeton, University of Wisconsin, and Caltech, respectively,-developed a mathematical model of the U.S. Appellate Court system decisions. More specifically, they looked at the appellate courts’ mistakes and tried to determine if deliberations were effective in reducing judicial errors. What they found was that “deliberation lowers the incidence of incorrect decisions when judges tend to disagree” or are ill-informed before hearing a case. Otherwise, deliberation just gets in the way.

How important are these two diverse reports? Each in its own way is blazing a trail for us that will lead to a better economy and a better society.

We need only to look at the U.S. Senate to see the convergence of these two exploratory research paths. The Senate is sometimes referred to as “the world’s greatest deliberative body,” but the increasing numbers of key party-line votes suggests that polarization has taken over and little deliberation is going on. To estimate the impact of this change on democracy and on the economy, we will have to know more about the deliberation process and about the effects of political polarization — and these exploratory research reports are showing us a way.

James McCusker is a Bothell economist, educator and consultant.