“Contrast that with this world (all numbers in real terms):
Time period 1: A makes $1, B makes $6, C makes $10.
Time period 2: A makes $10, B makes $5, C makes $9.
The median change in income is negative, two out of three people saw their wages decline. Do you think this means the economy got worse?”
I’m not sure I’m following your overall points in this section, but I’d certainly expect people to vote like they believed the economy got worse in such a situation.
I agree with you. Unless the signal is so strong that people believe that their personal experience is not representative of the economy, it’s going to be overweighted. “I and half the people I know make less” will lead to discontent about the state of the economy. “I and half the people I know make less, but I am aware that GDP grew 40%, so the economy must be doing fine despite my personal experience” is possible, but let’s just say it’s not our prior.
“Contrast that with this world (all numbers in real terms):
Time period 1: A makes $1, B makes $6, C makes $10.
Time period 2: A makes $10, B makes $5, C makes $9.
The median change in income is negative, two out of three people saw their wages decline. Do you think this means the economy got worse?”
I’m not sure I’m following your overall points in this section, but I’d certainly expect people to vote like they believed the economy got worse in such a situation.
I agree with you. Unless the signal is so strong that people believe that their personal experience is not representative of the economy, it’s going to be overweighted. “I and half the people I know make less” will lead to discontent about the state of the economy. “I and half the people I know make less, but I am aware that GDP grew 40%, so the economy must be doing fine despite my personal experience” is possible, but let’s just say it’s not our prior.