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THE NEW political dispensation in Guyana, comprising a minority government [People’s Progressive Party/Civic (PPP/C)] and an opposition-controlled [A Partnership for National Unity (APNU) and Alliance For Change (AFC)] parliament, provides the framework for a new political culture; but it also provides enormous adrenalin flow to the ever fertile rumour mill. It should not be surprising that any minority government and the opposition may continuously look for opportunities to place their political status on firm foundations; and both
government and opposition may be calculating how far to go to support each other’s policies. And so at least for any minority government in the spirit of recouping its electoral losses, going to the polls or not going to the polls remains an active dilemma for decision-making. Today’s Perspectives partly examines Barbara Vis’ (2011) study of prospect theory to explain political calculations under risk conditions.
These political calculations drive what decisions to make; and such decisions involve risk. But how do people make decisions under risky conditions? Prospect theory (Kahneman and Twersky, 1979) may be applicable here. This theory suggests the following: People make different choices when they have benefits and losses. When people face losses, they accept the risk in making decisions because they want to recoup their losses; when people have benefits/advantages, they are not happy taking risks because they want to hold on to what they already have.
In addition, people generally feel a hurt more when they face losses than when they experience gains. Put another way, ‘losses hurt more than equal gains please’ (McDermott, 2004). And the people who are loss averse would tend to avoid change, and so would latch on to the existing
state of affairs. And they may very well want to remain with the present situation because with any change, the losses seem greater than the gains (Kahneman et al., 2000).
Applying prospect theory to Guyana would suggest a few things. The combined opposition (APNU and AFC) with a one-seat majority in parliament may see this majority as an advantage/benefit, and so may not be comfortable to change its situation. The opposition has another option for political decision-making. This option involves a coalition of APNU and AFC prior to any national and regional election. Nevertheless, the combined opposition may experience risk-aversion, whereby it wants to hold on to what it has. On the other hand, the PPP/C minority government may be more likely to take the risk of trying to recoup its electoral losses. According to prospect theory, people are less likely to take risks when they have advantages/gains than people who face losses. In this situation, the PPP/C is the likely risk taker.
In the case of Guyana, how does prospect theory work in the context of individual voters? In the same way as prospect theory has some applicability to political parties, it also has implications for an individual voter’s political decisions.
Would an individual voter turn out to vote in a ‘snap’ election? If this voter is experiencing losses from the last election, then this voter would be more likely to vote at a ‘snap’ election; on the other hand, if a voter experiences benefits or gains from the last election, then that voter may be less enthused to vote at a ‘snap’ election. In this situation, parties may have to ‘sus’ out what the losses and the gains mean for an individual voter.
For the PPP/C minority government to recoup its electoral losses at some future election, it, therefore, has to win over those voters who believe that they are enjoying advantages/benefits from the previous election. So while PPP/C minority government may more likely be a risk taker at summoning a national poll, it also has to convince those voters to change political preferences in a situation where they feel they have benefits/advantages accruing from the last election.
These voters may want to hold on to what they already have. And, indeed, there is that option of APNU/AFC coalition, where with their gains they would tend to avoid risks, and so they may want to leave things as they are. But their supporters with fewer gains than the APNU/AFC machinery from the last election may be less risk-averse and, therefore, may influence APNU/AFC toward a coalition. Nonetheless, people generally tend to avoid risks, especially in politics. But, indeed, there are calculated risks.
government and opposition may be calculating how far to go to support each other’s policies. And so at least for any minority government in the spirit of recouping its electoral losses, going to the polls or not going to the polls remains an active dilemma for decision-making. Today’s Perspectives partly examines Barbara Vis’ (2011) study of prospect theory to explain political calculations under risk conditions.These political calculations drive what decisions to make; and such decisions involve risk. But how do people make decisions under risky conditions? Prospect theory (Kahneman and Twersky, 1979) may be applicable here. This theory suggests the following: People make different choices when they have benefits and losses. When people face losses, they accept the risk in making decisions because they want to recoup their losses; when people have benefits/advantages, they are not happy taking risks because they want to hold on to what they already have.
In addition, people generally feel a hurt more when they face losses than when they experience gains. Put another way, ‘losses hurt more than equal gains please’ (McDermott, 2004). And the people who are loss averse would tend to avoid change, and so would latch on to the existing
state of affairs. And they may very well want to remain with the present situation because with any change, the losses seem greater than the gains (Kahneman et al., 2000).Applying prospect theory to Guyana would suggest a few things. The combined opposition (APNU and AFC) with a one-seat majority in parliament may see this majority as an advantage/benefit, and so may not be comfortable to change its situation. The opposition has another option for political decision-making. This option involves a coalition of APNU and AFC prior to any national and regional election. Nevertheless, the combined opposition may experience risk-aversion, whereby it wants to hold on to what it has. On the other hand, the PPP/C minority government may be more likely to take the risk of trying to recoup its electoral losses. According to prospect theory, people are less likely to take risks when they have advantages/gains than people who face losses. In this situation, the PPP/C is the likely risk taker.
In the case of Guyana, how does prospect theory work in the context of individual voters? In the same way as prospect theory has some applicability to political parties, it also has implications for an individual voter’s political decisions.
Would an individual voter turn out to vote in a ‘snap’ election? If this voter is experiencing losses from the last election, then this voter would be more likely to vote at a ‘snap’ election; on the other hand, if a voter experiences benefits or gains from the last election, then that voter may be less enthused to vote at a ‘snap’ election. In this situation, parties may have to ‘sus’ out what the losses and the gains mean for an individual voter.For the PPP/C minority government to recoup its electoral losses at some future election, it, therefore, has to win over those voters who believe that they are enjoying advantages/benefits from the previous election. So while PPP/C minority government may more likely be a risk taker at summoning a national poll, it also has to convince those voters to change political preferences in a situation where they feel they have benefits/advantages accruing from the last election.
These voters may want to hold on to what they already have. And, indeed, there is that option of APNU/AFC coalition, where with their gains they would tend to avoid risks, and so they may want to leave things as they are. But their supporters with fewer gains than the APNU/AFC machinery from the last election may be less risk-averse and, therefore, may influence APNU/AFC toward a coalition. Nonetheless, people generally tend to avoid risks, especially in politics. But, indeed, there are calculated risks.
