The idea of representative democracy is that we pay lawmakers to give serious attention to the nuances of policy questions and cast votes on our behalf in accord with their understanding of our preferences, applied to those nuanced understandings.
Tim Harford (previously) proposes that the reason we get crappy outcomes from referendum (e.g. Brexit) is that a low-engagement electorate is won't take the time to understand the issue in the referendum and will instead treat it as a plebiscite on the status quo, so "Should the UK leave the EU?" is voted on as if the question was, "Is the UK fine the way it is, or should we change things?"
Harford says that low-engagement from the electorate is always a problem for democracies, but "representative democracy provides a line of defence against voter ignorance, by asking us to elect someone to make considered choices on our behalf." It's certainly true that referenda have produced some terrible outcomes, like California's moratorium on property tax hikes, but they've also served as a check on corruption: in South Dakota, a ballot measure enacted a suite of commonsense campaign finance reforms, only to have them snuffed out by dirty legislative tricks -- the activists behind that campaign will put another measure on the 2018 ballot forcing the state to abide by referendum results.
In an age of inequality, our bad legislative outcomes are more apt to come from legislative and regulatory capture as they are to come from ill-starred referendums. When the average Congressjerk spends half of every working day calling major donors and begging for money, can they really be said to be employed in the solemn job of researching the nuances of policy? Or are they just figuring out how to optimize their legislative activities to maximize campaign contributions.
I think that Harford's right that weird referenda outcomes are often a vote of no-confidence in the status quo, and not support necessarily for the specific measure on the ballot paper. But doing away with referenda will abolish an important check on corruption, and if disgust with corruption is what's driving the dissatisfaction with the status quo, a referendum-free populace will find even more destabilizing ways of expressing their discontent (see Trump, Donald J.).
If voters are not paying close attention, then what might we expect from a referendum? The psychologist and Nobel laureate Daniel Kahneman, in Thinking, Fast and Slow (UK) (US), writes, “When faced with a difficult question, we often answer an easier one instead, usually without noticing the substitution.”
The difficult question in a referendum might be, “Should the UK remain in the EU?”; the easier substitution is, “Do I like the way this country is going?”
Another simple heuristic is this: “If one of the options was awful, they wouldn’t be asking, would they?” Except that in the UK’s referendum on EU membership, for reasons of short-sighted political expediency, they did ask.
Of course, any democratic system is weakened by the fact that voters are not paying close attention. But representative democracy provides a line of defence against voter ignorance, by asking us to elect someone to make considered choices on our behalf.
How referendums break democracies [Tim Harford/The Undercover Economist]