Abstract
Schumpeter’s theory of democracy can be read through the lens of the cognitive approach to rationality. Schumpeter himself constructed his theory on the basis of his (neglected) conception of conscious rationality, which considers the process of thinking as composed of conscious/deliberate and unconscious/automatic components. The prevalence of the deliberate over the automatic component can occur in different degrees; as a consequence, individuals exhibit different levels of conscious rationality. Schumpeter makes clear that an essential attribute of democracy is its being a system of government capable of working notwithstanding a low degree of conscious rationality among its citizens. Given this condition, the process of political communication and persuasion can lead to two very different outcomes: a fair social construction of the democratic institutions, in which the struggle for the vote is achieved through a critical debate among leaders and citizens; and an unfair construction, based on the prevalence of emotive forces of persuasion over rationality and on cheating of the leaders at the expense of their citizens. Schumpeter suggests that the main element that fosters a fair construction is the effectiveness of competition, which can advance the rational elements in the political debate and the self-determination of the citizens’ will: a slow process that – he warns - may be effective only in the long run, and does not preserve democracy from the risk of decline.
Highlights
Part IV of Schumpeter’s Capitalism, Socialism and Democracy is characterized by a brilliant and realistic picture of capitalism supported by new and powerful theoretical ideas, which in my opinion have not far fully realized their potential
If we consider the pages dedicated to entrepreneurship and to democracy, we see that the intellectual toolbox he used in his previous works - based on the economic thought of the French and Austrian schools, and to some extent limited by the implicit contrasts between those two schools - has undergone a radical evolution
The previous points imply that, in a democracy, leaders can manipulate opinions and produce systematic distortions of the popular will: this is a crucial aspect of Schumpeter’s analysis. It follows that if we do not want to relegate it to a pure description due to his acute insight, it is necessary to appeal to the modern theory of psychology of cognition, in which the characteristics of reasoning and, in particular, the role of persuasion and manipulation, has been extensively studied and experimentally proved
Summary
Part IV of Schumpeter’s Capitalism, Socialism and Democracy is characterized by a brilliant and realistic picture of capitalism supported by new and powerful theoretical ideas, which in my opinion have not far fully realized their potential. The previous points imply that, in a democracy, leaders can manipulate opinions and produce systematic distortions of the popular will: this is a crucial aspect of Schumpeter’s analysis It follows that if we do not want to relegate it to a pure description due to his acute insight, it is necessary to appeal to the modern theory of psychology of cognition, in which the characteristics of reasoning and, in particular, the role of persuasion and manipulation, has been extensively studied and experimentally proved. The main problem that Schumpeter has to solve in sketching the fundamentals of democracy is conceiving institutions that produce rational, or at least reasonable, public decisions despite substantial limits in terms of individuals’ rationality and competence He highlights the observation that a defining property of democracy is its being an institution that may function even if the degree of awareness, competence and analytical effort of citizens is low, provided that it is balanced by responsible behavior on the part of its leaders. The only method that reduces the citizens’ chances of being fooled by irresponsible leaders and assures a good quality of democracy is a process of reducing the citizens’ competence gap, which, according to Schumpeter, can only occur in the long run
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