Consider a world where 80% of people are Conformists, 10% of people are Righteous, and 10% are Reprobates. The Conformists are epistemically and morally neutral, so they believe and support whatever is popular. [...]
What happens? There are clearly two equilibria: one good, one bad. If the true&right is popular, then the Conformists and the Righteous have 90% of the vote, so the true&right prevails. If the true&right is unpopular, then the Conformists and Reprobates have 90% of the vote, so the false&wicked prevails.
Now suppose that in this world, you are trying to assess an individual's virtue. In the good equilibrium, identifying the virtuous is hard. Only 1 out of 9 supporters of the status quo is genuinely virtuous. The vast majority support the true&right out of sheer convenience. Identifying the vicious, however, is easy. In the good equilibrium, all supporters of the false&wicked are vicious.
The mirror image holds in the bad equilibrium. Identifying the virtuous is easy: Everyone who supports the true&right despite their unpopularity is virtuous. Identifying the vicious, in contrast, becomes hard. Only 1 out of 9 supporters of the status quo truly qualifies. The vast majority of supporters of the false&wicked don't support it out of conviction. They support the false&wicked to fit in.
There's an interesting tension here. To know who is virtuous, we need a bad equilibrium. Personally, I would rather not know who is virtuous, and have the good equilibrium. From this standpoint, the model makes me question why we want to know who has virtue. Edit: In the good equilibrium, we know for certain who is wicked. This could have value because we could use that information to root out the wicked. That said, it is probably better to just take the model as a positive theory of discovering vice.
Setting the measurement of virtue/vice aside, Caplan's model can easily be interpreted more generally and applied to different contexts. For example, you could relabel the groups as Moderates (conformists), Rightists, and Leftists. All you need are 3 groups: one set of conformists, and two sets of set-in-their-ways groups. With moderates, rightists and leftists, Caplan's theory becomes a model of partisanship.*
Caplan's theory implies that if you want to determine if someone is Right of center of Left of center, just look at their unpopular positions. Note that this model of partisanship avoids the "Hansonian caveat" -- there's no particular virtue with siding on the left or right, per se. Hence, it is less clear why conformists would abandon conformity to signal some sort of virtue.
In my mind, the main criticism of this theory of partisanship is that moderates are not simply conformists, trying to vote for whatever is popular. Rather, it is possible that they actually have moderate beliefs. Nevertheless, such unreality never stopped anyone from exploring the implications of a model. In the words of Milton Friedman (page 36):
Everything depends on the problem; there is no inconsistency in regarding the same firm as if it were a perfect competitor for one problem, and a monopolist for another, just as there is none in regarding the same chalk mark as a Euclidean line for one problem, a Euclidean surface for a second, and a Euclidean solid for a third. The size of the elasticity and cross-elasticity of demand, the number of firms producing physically similar products, etc., are all relevant because they are or may be among the variables used to define the correspondence between the ideal and real entities in a particular problem and to specify the circumstances under which the theory holds sufficiently well; but they do not provide, once for all, a classification of firms as competitive or monopolistic.
There is always a simplicity-realisim tradeoff in modeling. Caplan's model is quite simple, and that is a big reason why it is useful.
* You could also label the conformists to be bandwagon fans, and define the two groups as die-hard fans of Rival 1 and Rival 2. This is a simple theory of rivalry in sports. There's no particular virtue on either side of the divide, but you can tell who is a die hard fan by who attends the games and wears the team colors during a losing season. Easy intuition, yes, but it is interesting seeing a model of sports rivalry that can be fruitfully applied to both politics and virtue.