Heuristics
However, it is important to note that the link between the manipulation of heuristics by firms and the rise of oligopolies is far from direct, with other factors such as productivity, business model, etc. perhaps playing a far larger role. Moreover, the ability to empirically demonstrate such a link is negligible, even with sophisticated techniques of regression, nor is it feasible to quantifiably link this to wider market successes. On the other hand, such a link is more easily demonstrable with the positive effect of nudges, as reflected by Ariely’s organ donation figures, and similarly with the TDA uptake in the (Duflo, 2003) study. Furthermore, the studies involving firms’ manipulation of heuristics are primarily set in monopolistic or duopolistic scenarios, which, although perhaps similar to a supermarket, cannot reflect free markets with lower asymmetric information, as can be seen increasingly with e-commerce and use of joint comparison to eliminate the adverse effects of some of these biases.
Politics and democracy
Some of the more problematic effects of the application of heuristics in recent years have been felt in the pitfalls of modern democracy, in part contributed to by the rise of social media and misinformation, but made particularly visible by growing political polarization. Arguably, this is not solely a modern phenomenon, with cognitive shortcutting in decision-making posing significant questions as to what extent democracy is able to function effectively even in principle, if both voters and elites are unable to make decisions rationally according to what is in their interest, or in the interest of the public. (Dancey, 2013) volunteers extensive studies of voter knowledge in a representative study of over 30,000 Americans adults. They analysed participant ability to recall the voting habits of their local senator in a range of major votes in the past two or so years, with participants offering a relative level of political interest, from which researchers could determine an expectation of correct knowledge. In cases where senators remained nondeviant by toeing party lines, correct knowledge of voting habits increased linearly with political interest, with lack of knowledge decreasing at the same rate, and incorrect knowledge remaining constant, just as hypothesised. However, in deviant cases, where senators voted against party lines, incorrect knowledge this time increased at an approximately equal rate (and usually start position) as correct knowledge. This therefore presents a major flaw in voter decisions: a belief of incorrect knowledge as correct is more prevalent with increased political interest, when politicians do not follow party lines. The ramifications of this are significant, both in informing how voters make decisions, and in the failure of the role of the politically engaged to hold leaders accountable, where otherwise a leader’s deviance would go unnoticed. The evidence provided in the study offers a decorrelation between increased political interest and a genuinely greater political knowledge base, instead offering a different reasoning for increased political understanding (with the assumption that increased interest must improve understanding to some extent). Dancey et al. argue that, instead of having more information, the politically engaged develop stronger, or at least more accurate, heuristics about a party or a group, such as by using the availability bias and the representativeness heuristic, to inform their knowledge base. And though this clearly has a greatly positive impact on their ability to accurately understand what a political entity stands for, it also greatly diminishes their ability to distinguish the beliefs of an individual politician. This is a significant factor on a regional basis, where deviant public
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