Adam Szeidl & Ferenc Szucs conspiratorial model of Populism.

My friendly A.I assistant tells me that 

Populism is a political approach that positions "the people" against a corrupt or self-serving "elite," claiming to represent the authentic voice and will of the common person, often in opposition to established institutions.

Andrew Jackson is considered the first populist President. One may deplore his attitude to the First Nations or to African Americans but we have to admit that a more upper class President would have presided over the same thing. One may say that the 'spoils system' encouraged what Pareto called the 'circulation of elites'. Rotating offices may have increased corruption or incompetence but it gave more and more people experience of administrative or judicial procedure.

Can Trump be compared to Jackson? No. Jackson, like Eisenhower or Grant, was a General. Moreover, the franchise had already been expanded and would have been expanded further in any case. The country was growing so rapidly, that the influence of the more aristocratic element was bound to diminish. Trump is sui generis because he never received a Government salary of any sort before getting the top job. He wins because markets think he is good for the economy. If markets turn against him there is a risk that the country will sink into stagflation and his party will lose control of Congress. He may have to resign to avail of a Presidential pardon. The hope is, he will do a U-turn on any policy which spooks the markets while continuing to deliver tax cuts, less regulation, etc. 

A recent AER paper offers

A Model of Populism as a Conspiracy Theory

When was the US worst afflicted by 'conspiracy theories'? The answer is during the McCarthy period. Interestingly, both Nixon and Kennedy got their start under the Senator. But Eisenhower was a good guy who had no truck with that brand of craziness.  

By Adam Szeidl

a Professor at Soros's University in Vienna. Orban chased it out of Hungary. We can be fairly sure the man isn't crazy about Trump or 'populists'. 

and Ferenc Szucs

at Stockholm University. The European Research Council gave him some money to investigate 'alternative reality'. It wasn't money well spent.  

The fact is, institutionalised elites (a nomenklatura) may subscribe to conspiracy theories. They can have an esoteric doctrine for the initiated and an exoteric 'noble lie' to be broadcast to the hoi polloi. The Straussian neo-cons are an example. By contrast, Populists have to promise things which are popular though this may only be because of the prejudices of poorer people whose lives are full of frustrations of various sorts. The difference between Obama and Trump is captured by the former saying 'we can' and the latter saying 'I will'. Nobody is interested in Trump's thinking. Will he deliver? That's all that matters. 

We model populism as the dissemination of a false “alternative reality”, according to which the intellectual elite conspires against the populist for purely ideological reasons.

Elites are likely to want to maintain their own power. It is in their interest to 'conspire' to silence dissenting voices raised even within their own charmed circle, let alone the cries of rage or despair emanating from the 'great unwashed'.

If enough voters are receptive to it, this alternative reality—by discrediting the elite’s truthful message—reduces political accountability.

Where there is an elite, accountability is reduced. This may be a good thing. The experts may indeed know best and their time is wasted if they have to justify every single thing they do. But experts may be wrong. Moreover, they may have vested interest in preventing the truth from becoming known.  

When it comes to messages, we need to differentiate between 'cheap talk' and 'costly signals'. If elites 'put their money where their mouth is'- e.g. emigrate from a country when a bad politician gains power- that is a 'costly signal'. If they merely say what everybody else is saying because it costs them nothing to do so they may be virtue signalling.

Elite criticism, because it is more consistent with the alternative reality, strengthens receptive voters’ support for the populist.

I think they mean 'Criticism of elites is consistent with an alternative reality'- e.g. one where shape-shifting lizards from Planet X have replaced all the top officials.  

Alternative realities are endogenously conspiratorial to resist evidence better.

Organised Religion may have that property. But so does a theory which suggests that criticism of those who currently have power is part and parcel of a paranoid delusion system.  

Populists, to leverage or strengthen beliefs in the alternative reality, enact harmful policies that may disproportionately harm the non-elite.

In which case, they cease to be popular and lose elections. The damage they can do is limited in a Democracy under the rule of Law.  

These results explain previously unexplained facts about populism.

Let us see if this is in fact the case. 

Populist leaders paint a grim picture of the world.

No. They paint a rosy picture of what the world will become when they take power. Religion may paint a grim picture of the world so that people spend more time praying and thinking about the after-life. Politicians need to promise things which the public actually wants. Some may say 'What Americans really want is for 'Turtle Island' to be restored to the First Nations. Those of European of African or Asian descent should deport themselves.' But this is not a view which is popular with American voters. They may want immigrants to be deported because 'they take our jobs', but they don't want to deport themselves.  

The populist ideology is often centered around a false narrative, an alternative reality, in which a conspiracy of the elite shapes major events to the detriment of the people.

Like Orban saying Soros wants to bring in lots of Muslims into Hungary? The problem here is lots of other countries seem to be worried about immigration from places like Afghanistan. Currently Iran and Pakistan are deporting the most Afghan Muslims. No doubt, this is the fault of populist Islamophobia in those two countries.

In this narrative, the elite is not only “corrupt”, as described in leading accounts of populism (Guriev and Papaioannou, 2022); it is conspiratorial and all-powerful.

An anti-populist ideology offers a false narrative according to which an elderly business man is actually Adolph Hitler in disguise.  

For example, a central part of Donald Trump’s political narrative is that the 2020 US election was stolen by a conspiracy of the deep state.

Human beings understand that 'narratives' offered by a candidate are strategic. But so are beliefs. Newcombe problems or Kafka's toxins show why having an irrational belief can be beneficial.

Trump had to make some such claim if he was to retain control of the Republican party.  At the time, this seemed a forlorn hope. The real puzzle is how Trump has managed to make himself the King of his party. The answer, I think, is migration and fears of 'demographic replacement'. Perhaps there has also been a backlash against 'Wokeism'. Vivek Ramaswamy has done very well for himself by publishing a book attacking that ideology.  

The populist narrative matters because it shapes supporters’ beliefs: the majority of Republicans believe that Trump did not lose the 2020 election legitimately.

If he didn't lose, then he should remain the King of his party. But if Trump doesn't lead it, who will? Foreigners may think the Republicans had more attractive candidates, but Americans don't appear to do so. Why? I suppose the answer is that Trump, like Perot, wants to set the clock back to a sort of 'closed economy Keynesianism' featuring 'optimal tariffs' and a robust industrial policy.  The plain fact is markets rose when Trump was re-elected. They fell in April over tariff concerns but have risen again. If they keep rising then it doesn't matter what 'intellectual elites' say. Investors are the only 'experts' who count. 

These sorts of misbeliefs are potentially highly consequential.

As is the 'misbelief' that Trump is part of some vast conspiracy. Why not simply say he is a shape-shifting lizard from Planet X?  

Populism is also associated with a profound decline in political accountability.

We think guys we didn't want to see elected are very horrible. True political accountability would involve their confessing to rape, murder, arson, and saying rude things about fat people. After that, they should hand themselves over to the FBI and go quietly to prison.  

Funke, Schularick and Trebesch (2023)

who consider Boris Johnson a populist. Why not Rishi Sunak? Their policies were the same. Why is Modi a populist but not Imran Khan? The fact is, a politician like Modi or Johnson who rose up within a cadre base political party, is not a populist even if he is very popular. In British politics one might say Baldwin and Thatcher paid attention to PR and left their stamp on the politics of their age. If Farage comes to power, we might say that populism has triumphed in England. Otherwise, it is the rank and file of the Parliamentary party with a majority in the House of Commons which decided who will lead the country.

show that populist leaders, despite substantially reducing GDP per capita, stay in power for twice as long as non-populists.

Popular leaders may do so if there is no attractive alternative. Modi came to power in 2014 because Rahul refused to step up to the plate. He has lost his majority but there is still no other credible Prime Ministerial candidate. Things may have been different if Gehlot had agreed to run for the post.  

Moreover, populists seem to achieve electoral success despite widely-publicized acts that would normally be extremely damaging: for example, Donald Trump, a convicted felon, won the 2024 election.

The prosecution asked for an 'unconditional discharge' which is what he got. It appears that his felony attracted neither fine nor a prison sentence.  

In our theory, the goal of populism is to provide a false alternative reality that discredits the intellectual elite’s message about the politician.

There is no homogenous 'intellectual elite'. Every party has some smart people with high educational credentials. There were plenty of Professors who supported Hitler and Mussolini and Stalin and Mao and so forth.  

Specifically, we assume that populist propaganda can (partially) persuade voters that the elite conspires to criticize the politician’s competence purely because they disagree with his ideology.

People aren't stupid. They get that an egghead who stands to gain if his Party is elected has a strong motive to pretend that the other candidate is a moron with loose morals.  

This alternative reality discredits elite criticism that would normally reveal the politician’s type.

Sadly, only his performance reveals his type. I recall the surge of anti-Reagan propaganda back in the early Eighties. Gore Vidal spread the canard that the senile cowboy would start World War III because he believed in 'the Rapture'- i.e. all the good Christians getting beamed up to Heaven while the Earth was blown apart by nuclear missiles.  

There were good economists who criticized both Reagan and Thatcher's monetary policies- which they quickly abandoned. What was surprising was that the working class did not support the air traffic controllers or the Coal miners. Mass unemployment was believed to be political poison. Yet, the working class tolerated it because they cared more about inflation. 

“Bad” politicians, expecting elite criticism, propagate the alternative reality to remain in power.

Sadly, propaganda isn't enough to stay in power. You have to be better than the alternative candidate. Very often, if a leader remains in power it isn't because he was doing a good job. It's just that the opposition could not unite around someone electable.  

Thus, our theory predicts both the use of conspiratorial propaganda and its association with reduced accountability.

Sadly, voters care about outcomes not accountability. Saying 'I've tanked the economy but my account-books are very well maintained' isn't going to win you the election.  

We formalize these ideas in a model which explicitly incorporates the false
alternative reality. Beyond explaining our motivating facts, this model makes
several new predictions. It predicts that truthful elite criticism can backfire and
strengthen some voters’ support for the politician;

if they think that the other party would have done a worse job- sure. Otherwise, such criticism seems pointless.  

that alternative realities are endogenously conspiratorial to better resist evidence;

sadly having a conspiracy theory doesn't improve your life. What matters is having a better choice menu. There were people who thought Reagan was stupid. But they voted for him because the alternative was worse. What puzzled foreigners was Hilary's defeat. We put it down to Comey's intervention. Why did Obama appoint a Republican in Sept. 2013? One can be a little too high-minded.  

and that populists, despite their “pro-people” rhetoric, may set policies that disproportionately harm the non-elite.

They may do stupid shit. That's why it is important to have a good candidate whom people feel won't do stupid shit. Sadly, Biden didn't fit the bill though he started well. But Trump too may come a cropper by the end of the year.  

These results offer a new understanding of populism.
In our model, presented in Section 2, an incumbent politician is characterized
by a type dimension, e.g., competence, along which he can be good or bad.

Sadly, we only know a politician's 'type' after the event. Reagan turned out to be very good. Thatcher turned out to lack political horse-sense.  Her own party dumped her in an ignominious manner. But they also got rid of Johnson whom voters liked. 

Voters do not directly observe the politician’s type but form beliefs over it, and political
accountability is measured with the accuracy of their beliefs.

That is not the usual meaning of the term. In a Democracy, politicians are accountable to the Cabinet, the Legislature and the Judiciary. Election outcomes determine whether voters think they are better or worse than a rival candidate. This is based on 'Expectations' not 'Accountability'.  Consider the case of Joe Biden. At one time, we thought he had beaten Trump once and could do so again. Then expectations changed. The man might be senile. He had to go. With hindsight, Kamala was a bad choice. Both her parents were immigrants and the country was turning against 'affirmative action' and being welcoming to even highly qualified immigrants. 

The politician and the intellectual elite send messages which affect these beliefs.

Messaging is important. But if you look decrepit on TV, people draw their own conclusions.  

First, the politician chooses whether to send conspiratorial propaganda.

Most avoid it because it makes them look like losers. Trump retains some appeal as a 'deal maker'. But if the Chinese don't give him a favourable deal, the Stock Market may fall. 'Exorbitant privilege' may be lost as 'de-dollarization' proceeds apace. The cost of living starts to rise at just the time when a 'negative wealth effect' kicks in. Stagflation returns to the economy. There's a good reason the sort of 'closed economy Keynesianism' taught to the Wharton Class of '68 had to be abandoned. 

Then the elite (including the news media), having received an informative signal about the politician’s type, sends a message that reports on that signal. We assume that the elite consists of a continuum of small members, who individually cannot influence voters and
thus report about the signal truthfully.

What a bizarre assumption! The elite needs well-paid jobs otherwise it isn't elite at all. It is a bunch of smelly people who buy their clothes at the thrift store. Guess who offers well-paid jobs? It is Media magnates and billionaires who fund Think-Tanks. Each party has its own eco-system to pay highly credentialised eggheads. But money talks. Bullshit walks.  

A share α of voters are receptive to propaganda,

In which case, PACs will find ways to identify and target them. The rest of the population doesn't matter.  

so that propaganda exogenously and counterfactually increases their prior belief in the alternative reality (AR).

Why stop there? If these guys are susceptible to propaganda then they are stupid enough to fall for all types of scams. Information about them would be available- for a price. They soon won't have a pot to piss in. Also, the comelier amongst them would be incessantly sucking off anyone who told them that their jizz was the elixir of immortality.  

The AR is a state of the world with zero objective probability, which differs from the objective reality in precisely one way:

Why just one? If you can brain-wash a percentage of the population, why not also enslave them and get them to donate their kidneys to any pal of yours who needs one? 

An economic theory which posits the irrationality of a portion of the population isn't 'ergodic'. It isn't scientific. It is a 'just so' story of a paranoid type.  

In the AR the continuum of small elite members can coordinate—effectively conspire—and thus can collectively choose their message to influence voters.

In actual reality, people in high positions do coordinate their actions.  That's how political parties and PACs and Think-Tanks work. Everybody knows this. We get that a registered Democrat is going to say 'Trump is shit' while a Republican will focus on how shit the Dems are. 

It follows that if elite members sufficiently dislike the politician, perhaps because they disagree with his ideology, then in the AR they will always report that politician bad. Intuitively, in the AR the “fake news media” criticize Trump’s competence not because he is incompetent, but because he is “anti-woke.”

Sadly, it appears the vast majority of people are 'anti-woke'. They don't think bearded rapists should be sent to women's prisons just because they have decided to change their name from John to Joanna.  

We analyze the model in Section 3. We show that an equilibrium of the fol-
lowing form emerges. (i) In the objective reality only the bad politician sends
propaganda, and the elite always reports truthfully.

This is not the actual reality. It is a conspiracy theory about evil people who are destroying Democracy. Why not simply say they are shape-shifting lizards from another planet?

(ii) In the alternative reality both the good and the bad politician sends propaganda, and the elite always criticizes the politician.

If that politician, or one of his backers, is paying their salary their criticism is likely to be muted or confined to esoteric policy discussions.  

Intuitively, in reality the good politician has no reason to send propaganda as he expects praise from the elite.

But praise from people who have specialized in types of praise which influence voters is more desirable. Forget praise. Just hire people who are great at P.R and Marketing and 'Image Consultancy' and so forth.  

The bad politician, who expects criticism, has an incentive to send propaganda if doing so discredits elite criticism.

Just say they are a bunch of Jewish homosexuals with fancy-shmancy Collidge degrees and be done with it. 

Discrediting only works if the narrative of the alternative reality is
plausible:

Sadly, this isn't true. The point about a scape-goat is that everybody knows the creature is innocent. They just want somebody else, not themselves, to be sacrificed. When things are shitty for almost everybody it is a comfort to know there is some group which is receiving even shittier treatment. I may not be able to pay my utility bill but I am in clover compared to some dude who has just been deported to Uganda.  

if it is incentive compatible for the conspiring elite to criticize even a
good politician.

This is the crux of the matter. People like Soros provided incentives to such critics. But, since Soros wasn't weeding out those who were ineffective, they had no incentive to do a good job. Indeed, their activities were highly counter-productive.  

This holds provided that elite members sufficiently dislike the
politician (sufficiently disagree with his ideology).

The puzzle is why Republicans are getting behind a guy whose economic ideology is so out of date. Perhaps, they fear that if their party doesn't tank the economy, Leftists like Sanders will do so. 

Under this assumption, the equilibrium admits the above form; otherwise it does not feature propaganda.

If you assume a portion of the population is susceptible to propaganda, then there will be propaganda. Moreover, every type of politician will indulge in it lest their rival corners that particular market. Equally, if there is a 'single-issue' voting block, every party will try to cater to it.  

These results immediately predict the equilibrium use of conspiratorial propa-
ganda, and its association with reduced accountability. Thus, our model helps
explain our motivating facts.

This is an exercise in circular reasoning. If you assume some voters can be brain-washed and that good politicians abhor brain-washing, then it follows that a bad politician will have an unfair advantage. The problem is that if some voters can be brainwashed to vote for bad politicians who tank the economy, then, surely, they can also be brainwashed into giving me their kidneys or letting me sleep with their wives. 

The model also yields new theoretical implications. First, it predicts that pro-
paganda inverts the effect of the elite’s message on receptive voters, so that elite
criticism increases their beliefs that the politician is good.

It also predicts that brainwashed people who are currently having red-hot pokers thrust up their bums by evil sadists will get very angry with anybody who points out to them that they are being tortured. What is happening to them is illegal. Yet, because they are brainwashed, they will kill any police-man who tries to intervene and demand yet more red-hot pokers be thrust up their bums. If this isn't happening in your neighbourhood, chances are the model advanced by these two nutters is utterly foolish.  

(Our) result explains a key fact in contemporary US politics: that the four criminal in-
dictments against Trump in 2023 were accompanied by an increase in his support
among Republican voters (Swan et al., 2023).

Because they thought it was 'lawfare'- i.e. the instrumentalization of the Justice system from a partisan motive. But, if the Dems were so scared of Trump it must be because he was the Republican candidate they most feared.  

This reaction by supporters of the presumptive party of law and order is puzzling,

unless you understand that Republicans want a Republican POTUS. Trump had won before. Could he win again? Yes. Biden was decrepit. Kamala was the child of immigrants. Ultimately, it was the perception that the Dems had increased inflation which was fatal. Trump was saying 'there were no wars when I was POTUS. There was strong growth in real wages. Vote for me and I will deliver Peace & Prosperity.' Suppose he had ended the Ukraine war and got the Nobel Peace Prize. The Chinese would have offered him a good trade deal. He could take things easy as his party made gains in Congress. A happy Trump would be a lazy Trump. The world would be a safer place. 

especially when compared to the case of Nixon, who lost Republican support after Watergate.

His economic policies, which represented peak-Keynesianism, failed.  

Our inversion result explains the increased support for Trump by predicting that it was the causal effect of the indictments.

This is correlation not causation save in so far as voters felt this was a partisan type of 'Lawfare'. South Park is currently satirizing Trump for using the same tactics on his opponents.  

This prediction is in line with survey evidence that Republicans claimed to increase support for Trump due to the indictments.

If the Dems want him out of the race, it must be because they are scared of him.  

It is also in line with new evidence we present that scandals of Republican politicians caused an increase in the donations they received from Trump supporters.

They will need to spend more to get re-elected. But they only get the money if a superior candidate can't be found.  

Finally, our model explains the contrast between Trump and Nixon through the logic that only Trump had a sufficiently large ideological cleavage with the elite to make the alternative reality plausible.

Nixon thought that the East Coast elite had it in for him. The authors say ' Although both Nixon and Adams attempted to use conspiracy theories to deflect criticism (Shabecoff, 1974; Mays, 2024), they were unsuccessful.' Nixon could not have stood for election again. He couldn't and didn't try to overturn the 22nd Amendment. He was literally a 'lame duck'. He needed a Presidential pardon. Proving a conspiracy in a court of law is difficult. Adams is standing for Mayor as an independent candidate. If he wins- which seems unlikely- then he has a bright political future. 

Nixon, representing the more educated party (Republicans around 1970), could not credibly argue that the intellectual elite conspired to remove him.

He could and did in the run up to the '68 election. He painted the Vietnam War as an elite conspiracy to enrich what Eisenhower had called the 'Military Industrial complex'. He appealed to ' the great Silent majority of my fellow Americans, I ask for your support. I pledged in my campaign for the presidency to end the war in a way that we could win the peace.' In '72, he and Agnew won by a landslide. Then came the first oil price shock and subsequent stock market crash which thoroughly disillusioned Americans. Maybe, if Spiro Agnew hadn't been forced to resign- with the result that Ford became Veep- the Republicans could have put up a better fight. Still, with hindsight, it was Reagan they should have chosen. 

we investigate the effect of conspiratorial populism on government policy.

Putting labels on things you don't like isn't 'investigation'. It is merely name-calling.  

This is an important topic since populism is associated with large economic and non-economic costs (Guriev and Papaioannou, 2022).

The opportunity cost is what is relevant. What would the other party have done? Very often, it is a case of 'better the devil you know'.  

We find that populists introduce harmful policies for two distinct reasons.

There is only one reason. It is popular and the leader is stupid enough to believe it to be a smart thing to do.  

First, there is a direct effect of reduced accountability: populism enables “bad” politicians to maintain power, who then enact “bad” policies.

Nonsense! Politicians are elected for a term of years. They may face impeachment or legal proceedings. That's as far as 'accountability' goes. The rules are the same for a bad guy or a good guy. Biden faced an impeachment inquiry. Few believe he had done anything wrong.  

Second, our model predicts that populists will choose harmful policies purely to trigger the elite.

They may do so if the elite is unpopular. But a non-populist may do so for the same reason. Macron is of the elite. Yet he closed the ENA to gain popularity.  

The intuition follows from the inversion result: since elite criticism increases the support of receptive voters, the politician chooses harmful policies to invite elite criticism.

If a particular bunch of guys are unpopular, it pays for politicians to attack them. However, they may secretly assure them that the thing is merely cosmetic.  

Harmful policies also emerge in the Acemoglu, Egorov and Sonin (2013) model, where populists signal their independence from the elite using policies that disproportionately harm the elite. The key difference is that our model can also account for harmful policies that do not disproportionately harm the elite.

It also explains why a section of the population can be brainwashed into giving away all their money and donating their kidneys to their brain-washers.  

As a result, our model helps explain the previously unexplained fact that populists, despite their pro-people rhetoric, are not actually siding with the “people”: their policies seem to hurt the non-elite as much as they hurt the elite.

This happens, regardless of the type of regime, when stupid shit is done.  

Indeed, Funke, Schularick and Trebesch (2023) show that populists reduce GDP per capita without meaningfully reducing inequality,

Maduro and one or two other such nutjobs may have done so. Modi hasn't. Nor has Erdogan.  

i.e., that they seem to cause equal economic harm to the elite and the non-elite. Populists also favor specific policies that especially harm the “people.” They tend to be massively corrupt (Zhang, 2024), thereby reducing the quality of government services; they implement tariffs that harm their core supporters (Fajgelbaum et al., 2019); and they oppose environmental policies that would help the non-elite (Friedman, Plumer and Stevens, 2025).

Why stop there? Why not prove, using a mathematical model, that populist leaders are entering our homes at dead of night and draining us off our precious bodily essence through aggravated acts of cunnilingus and fellatio? 

We conclude that the current wave of populism will likely create substantial harm to both the elite and the non-elite.

Populism is very bad. Leaders should be unpopular. Then they won't enter our homes at dead of night to drain us off our precious bodily essence. 

One thing puzzles me. The economics profession has an elite. But no two members of that elite agree on everything. There is inter-elite competition which militates for ideological differentiation (as in monopolistic competition). Moreover, there is 'elite circulation' which reinforces this differentiation. Indeed, you are likely to get 'distinctions without a difference'- i.e. observationally equivalent theories are attached to different dogmas. 

 We assume that the elite’s message sj and propaganda p are subject to vanishing noise.

Why? Noise is useful particularly where the number of predictors is small. Forecasting is improved by adding noise.  

This ensures that beliefs are well-defined off the equilibrium path.

But beliefs aren't well-defined at all! They are vague and inchoate. Sometimes there are Schelling focal solutions for coordination games. But hedging and income effects can arise through hedging on discoordination games. A Faith may be well-defined- i.e. be reducible to a dogma. But there is a mystery at the heart of Faith. Beliefs however may be highly idiosyncratic.  

With probability εe, perfectly correlated across elite members, every elite member’s realized message ˆsj is the opposite of the message sj sent; and with independent probability εp, realized propaganda ˆp is the opposite of the propaganda p sent.

Why? Surely, both will be adjusted if this is the case. I may be in the habit of saying 'no' when I mean 'yes', but I have to discard this habit to have a better life.  

We let εe and εp go to zero and characterize the equilibrium in the limit.

In other words, we have fixed the game so that we get the outcome we want.  

Alternative reality. To model the alternative reality, we assume that there is a state of the world θr ∈ Θr = {R, AR}, where R represents the objective reality and AR the alternative reality.

The extension of R is unknowable. It isn't a well-defined set. This is an example of the intensional fallacy. Nothing mathematical or logical can be proved about a thing which isn't a set.  

We assume that the true prior probability of θr = AR is zero.

The problem is that 'R' is epistemic. Expectations about R can create elements of R. That's one reason the extension is not well-defined. We may give the thing an ad hoc extension for some rough and ready purpose. But there is no point doing so if what you have to say is silly.  

The difference between the two realities is that in R the elite cannot, but in AR the elite can coordinate.

An elite which can't coordinate is not an elite. It is a bunch of rando nutters.  

Thus, if θr = R, then each elite member j chooses her message sj individually to maximize her own utility, but if θr = AR, then the elite collectively chooses an identical message sj = s for all of its members to maximize the sum of their utilities.

One can say one thing and do another. A lot of inter-elite competition has to do with 'distinctions without a difference'. You admit you will do the same thing as your rival but explain your philosophy is good and wholesome. His philosophy is totes slutty. 

The authors are using 'perfect Bayesian equilibrium'. The problem is that politics features not just incomplete information, but also Knightian Uncertainty. Thus the right way to proceed is to uses some some sort of regret-minimizing multiplicative weighting update algorithm. This cashes out as things like 'better the Devil you know' which is the reason shitty politicians get re-elected because, the fear is, their rivals are shittier yet.

One final point. A leader whose party is cohesive and obedient is more appealing then one who presides over a 'circular firing squad'. People think the former will be more effective whereas the latter has to devote all his energy to managing his people and preventing one of them from stabbing him in the back.

One may speak of 'strong man' leaders as likely to be populist because they focus their messaging on the people rather than various factions within their own party.  

The authors conclude thus- 

The same framework may be used to study other ideologies as well. One possible example is nationalism.

e.g. the American Nationalism of George Washington.  

Aiming to deflect criticism or initiate collective action, political leaders may demonize the citizens of the other country, 

they said Mad King George was trying to tax Americans. No taxation without Representation!  

an alternative reality that captures some elements of nationalism. Modeling this alternative reality may lead to

demanding that the US of A should humbly beg King Charles III to rule over their rich land 

predictions about the emergence and persistence of conflict, based on the idea that nationalistic ideology leads to a misinterpretation of other countries’ actions.

Nationalism is very evil. George Washington was a populist. King Charles III should re-conquer America and throw Donald Trump in prison.  

More generally, formalizing other ideologies as strategic alternative realities is a potentially important avenue for future research.

Democracy is very evil because Voters may vote for a Nationalist or a Populist or a Populist Nationalist. We hope King Charles III will ban elections after he reconquers the US.