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Liberální institut
Liberální institut

It is necessary to break through rational ignorance of voters, 4Liberty.eu economists think

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The conclusion of Prague economic conference, organized on occasion of THE TAX FREEDOM DAY 2013 with support of Friedrich Naumann Foundation, was quite clear: “We have to beat rational ignorance of Euroepan voters.”

Economists from four CEE think-tanks participating at 4LIBERTY.EU platform, Juraj Karpiš from INESS (Slovakia), Kaetana Leontjeva from LFMI (Lithuania), Magdalena Prasol from Liberté (Poland) and Aleš Rod from Liberalni institut (Czech Republic), presented recent situation in their countries related to public finance, political situation and level of rational ignorance of tax-payers.

Juraj Karpiš told audience about the tax-irresponsible behavior of Robert Fico’s government, especially increase of corporate income tax influent Slovak economy in bad way, analysts expect. Juraj Karpiš also presented educational projects of INESS used as channels for communication with Slovakian taxpayers. Especially a set of viral videos, the campaign RICHER SLOVAKIA, was an excellent example how to force people think about taxation and sources of public goods. The work of INESS was highly appreciated by all participants of the event.

The second speaker, Kaetana Leontjeva from Lithuanian Free Market Institute, spoke about public finance in Lithuania under tax reform that has been passed in 2008. The changes can be marked as negative ones because higher level of taxation hasn’t brought more revenues to the treasury nevertheless it has enlarged the shadow economy share. “Nowadays, Laffer curve does operate in Lithuania,” Kaetana said. She also shared experiences with argumentation against public finance myths (e.g. small taxes, small public expenditures, rich people contribute too small amount of money, etc). Considering these myths, LFMI is very active and uses various projects to refute them.

Magdalena Prasol (Liberté!) described benefits of 4LIBERTY.EU web portal. This website publishes high quality comments, analyses and articles in English, all written by various experts from various countries from CEE region. It is great to hear that the portal increases its outreach and visitors used to visit the web on regular basis. Liberal ideas need to be shared and this international website is good place for doing that, Magdalena said.

Aleš Rod, affiliated with CETA & Liberalni institute, Prague, set the problem of public finance to a playground of economics – to economic analysis of individual’s behavior. The main issue is called rational ignorance. A barrier of ignorance increases as well as a public finance system becomes more and more complicated in European countries. The ignorance of voters helps to politicians, rent-seekers, corrupters and other individuals who make economy of the state less and less efficient. Free-market supporters are often locked-in in the circle with people with same ideas and opinions; this weakens European liberalism very much. “We have to step outside the circle and try to break through rational ignorance, only big effort will bring pay-offs,” Rod pointed out.

In the Czech Republic, Liberalni institut has launched a brand new project – TAX BURDEN CALCULATOR. This project was introduced to participants with its co-author Lída Hadincová, analyst of Liberalni institut.

The event can be evaluated as very successful one; the media outreach was wider than organizers expected and ideas arising from both presentations and discussion will bring new impulses to all think-tanks.

The event was organized with support of The Friedrich Naumann Foundation. 

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