At Worthwhile Canadian Initiative, Stephen Gordon talks about the odd distribution of goalie decisions on penalty kicks and how they’re quite similar to politicians:
Goaltenders jumped in more than 90% penalty kicks in the sample: the frequency of staying put was only 6.3%. Kickers, on the other hand, distributed their targets in roughly equal proportions.
The goaltenders’ strategy was not wholly ineffective: when the kicker aimed left or right (71.4% of the time), goaltenders guessed correctly 6 times out of 11. But the fact remains that the frequency of the goaltender staying put (6.3%) is much smaller that the frequency of kicks aimed down the middle (28.7%).
This doesn’t mean that goaltenders should never jump. What it does mean is that goaltenders jump far too often. Why?
Bar-Eli et al suggest an explanation: ‘action bias’. This is presented as an example of Kahneman and Miller’s (1986) [PDF] ‘norm bias’. Goaltenders believe is is less bad to follow the ‘norm’ (i.e., to jump) and fail than to not jump and fail. In other words, goaltender think that jumping and missing is less costly than not jumping and missing.
Which brings us to economic policy. Politicians are continually demanded to ‘do something’ about a kaleidoscopic array of grievances, and the norm in these cases is to promise to do something. As far as politicians and most voters are concerned, doing something is better than doing nothing — even when doing nothing is the correct response.
In many cases — possibly the majority of cases — doing nothing is the smart move. A recent example is the concern about the so-called ‘skill shortage’. When firms complain that they can’t get the workers they want at the wages they are willing to pay, the correct response is to do nothing: the market response to a labour shortage is to let wages increase.
But doing nothing is almost always bad politics: it is invariably interpreted as a lack of concern, and this perceived indifference will be pounced upon by other political parties. A politician who promises to act polls better than one who promises to do nothing.
A goalkeeper who fails to jump looks like an idiot if the ball goes left or right. The fans roar their disapproval and the keeper learns that doing the dramatic-but-wrong thing is better for his reputation than the non-dramatic (but more likely to be correct) non-action. Politicians also learn that the media will turn themselves purple denouncing the lack of action (even when that’s the correct decision) and short-term polling numbers move in the wrong direction.
As Calvin Coolidge is reported to have said, “Don’t just do something; stand there.” But even if you’re right not to take action, it will be harder to bear up under the criticism of the “do something” crowd.