It is a well known and destructive phenomenon. It is at the root of most governmental deficits. When voting on appropriations it is very difficult to say no to more money for health, for children, for prison reform, for better defense, for better education, etc. All these are socially desirable. The clear thinker understands that they are not free and each have more or less social or productivity return. You can make a decision, if you accept that there is a limited pot of money to spend. But representatives don't want to and so we either pretend that each of these will pay for themselves either through future returns (that never materialize) or through savings from reduced waste and fraud (which also never materialize). Instead, we borrow the money, burden our economy and our children, close our eyes, hope for the best and go into debt. Thus sink economies and nations and always due to bad luck rather than bad decision-making rooted in social desirability bias. Or so the perpetrators tell themselves.
Here is Wikipedia's more expansive discussion of instances of social desirability bias.
Bryan Caplan has some interesting thoughts in The Diction of Social Desirability Bias. He ends with this observation.
In Moliere's The Misanthrope, Philinte insists,
In certain cases it would be uncouth,Philinte's right as far as he goes, but he misses a deeper issue. When we let Social Desirability Bias rule our diction, there's a grave danger our literally false words will corrupt our thinking as well. Indeed, such corruption is all around us.
And most absurd to speak the naked truth;
With all respect for your exalted notions,
It's often best to veil one's true emotions.
Wouldn't the social fabric come undone
If we were wholly frank with everyone?
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