Public Without Romance

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Public Choice

Politics Without Romance

Public choice theory demonstrates why looking to government to fix things can often lead to more harm than good, as one of its leading architects and Nobel laureate James M. Buchanan explains

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ublic choice should be understood as a research programme rather than a discipline or even a sub-discipline of economics. Its origins date to the mid-20th century, and viewed retrospectively, the theoretical ‘gap’ in political economy that it emerged to fill seems so large that its development seems to have been inevitable. Nations emerging from World War II, including the Western democracies, were allocating between one-third and one-half of their total product through political institutions rather than through markets. Economists, however, were devoting their efforts almost exclusively to understanding and explaining the market sector. My own modest first entry into the subject matter, in 1949, was little more than a call for those economists who examined taxes and spending to pay some attention to empirical reality, and thus to politics.

Initially, the work of economists in this area raised serious doubts about the political process. Working simultaneously, but independently, Kenneth Arrow and Duncan Black proved that democracy, interpreted as majority rule, could not work to promote any general or public interest. The now-famous ‘impossibility theorem’, as published in Arrow’s book Social Choice and Individual Values (1951), stimulated an extended discussion. What Arrow and Black had in fact done was to discover or rediscover the phenomenon of ‘majority cycles’, James M. Buchanan, winner of the 1986 Alfred Nobel Memorial Prize in Economic Sciences, is Distinguished Professor Emeritus of Economics at George Mason University. He is best known for developing the ‘public choice theory’ of economics. Reprinted from Imprimis (March 2003), the national speech digest of Hillsdale College (www.hillsdale.edu)

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