Tuesday, May 20, 2014

Capitalism, Socialism, and Education

Continuing with the survey I discussed in my last post, positive views of big business and socialism declined with education:

                        Big Business    Socialism
High school or less        68%             46%
Some college               58%             32%
College graduate           59%             23%
Graduate education         49%             39%

Positive views of small business, entrepreneurs, and capitalism increased with education:

                         Business   Entrepreneurs    Capitalism
High school or less        94%            83%          57%
Some college               98%            93%          67%
College graduate          100%            96%          80%
Graduate education         97%            92%          76%

There was no significant difference in views of free enterprise (or no significant linear increase; the contrast between high school or less and all others is significant):

High school or less        90%           
Some college               94%            
College graduate           94%            
Graduate education         94%       

There is a view, going back to Hayek, von Mises, and Schumpeter, that intellectuals are hostile to capitalism.  Of course, not everyone who graduates from college or even goes to graduate school is an intellectual, but it seems reasonable to assume that they'll be more influenced by the views of intellectuals (and Hayek, at least, meant "intellectuals" pretty broadly).   This idea remains popular among conservatives:  see slide 17 of Kevin Hassett's critique of Thomas Piketty for an example.  It clearly doesn't fit the data (or any data I've ever seen, for that matter).  

Another idea is that less educated people would be more suspicious of things that are abstract or remote:  that would include capitalism, socialism, entrepreneurs, and big business, but not small business.  That doesn't fit either.  

An idea that does fit is that involves distance from "elite" opinion.  American politicians invariably praise small business, entrepreneurs, and free enterprise, and condemn socialism and "big business."  (They often say nice things about particular big companies, but then they'll talk about free enterprise, or entrepreneurs, or job creators, etc.).   Less educated people may not have picked up this way of thinking (or at least speaking).

PS:  these differences are not driven by income; differences by income levels are small.  There are also some interesting gender differences:  women are considerably less positive about capitalism, and somewhat less positive about big business and entrepreneurs.  

[Data from the Roper Center for Public Opinion Research]  

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