What is public choice theory
Source
- public choice theory: the application of economic methods to the study of political processes
- government is a complex social machine inhabited by people who are the same as everyone else, and in which periodic elections play a central role
- economists are interested in human action, and they believe that action involves choice
- choice involves comparing alternatives
- always ask: compared to what?
- public choice economists ask this question in relation to alternative ways of organizing decision making
- compare the outcomes of market decisions to political decisions
- asking "what should government do about this?" is the wrong question because it makes certain assumptions about what kind of actor government is and what influences its decisions
- the government is thought as a benevolent despot
- this conception is dangerous
- government is not a single agent
- it is made by people who want to win the next elections
- public choice theorists want to put the democratic election process center stage in any analysis of policy
- what policy is likely to emerge from real-world democratic politics, and how does that compare to market alternatives?
- people also assume government is motivated to choose the policies that benefit the greater good
- people in markets are motivated by self-interest
- why should politicians be any different?
- when assessing policy
- don't ask what is the best policy we can imagine
- rather, what is the policy most likely to emerge
- they analyze
- how majority rule
- incentives that parties and candidates have to shift the cost of their programs on future tax payers and the associated debt problem
- incentive for the current regime to make it appear as though their policies cost less than they actually do
- lobbying processes, what political donors expect to gain
- james buchanan described public choice as politics without romance
- winston churchill said that democracy is the worst system of government, except for all the rest
- democracy is the best system available
- but heroic views of what democracy can achieve encourage false expecations
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