trying to find a bit about 'public choice theory', I came across this short article from The Ecomist
The voice of public choice :
"Public-choice economics assumes that government figures are merely human. They should be expected to look out for themselves rather than to act as saintly public stewards. It is a cynical (and, some might say, obvious) approach but a useful one. John Maynard Keynes may have been spot-on in concluding that big government deficits could boost a sagging economy. But Mr Buchanan reckoned such arguments led to a slow erosion of the “old-time fiscal religion” that taxes should be raised to meet government obligations. This made spending less politically costly, because politicians no longer felt under pressure to pair new spending with higher taxes. That, he rightly predicted, would lead to an era of persistent, big fiscal deficits and growing debt.
Public-choice analysis quickly provided the lens through which government action is now viewed. Legislators may “logroll”, for instance, striking deals with colleagues to pass measures that benefit small groups but are of dubious value to the general public. Governments are racked by “rent-seeking”, whereby firms aim to capture financial returns through special government privileges or monopoly rights. A construction company may spend its time lobbying for government contracts rather than courting private business, for example. That absorbs not only the resources of the firm eventually granted the privilege but also those of other firms competing for the same entitlement. As opportunities for rent-seeking expand, they siphon off resources from productive activities in the private sector and towards competition for government largesse. Public-choice theory counsels caution and care in expanding the role of the state."
From the Wikipedia article Public Choice:
"Buchanan and Tullock themselves outline methodological qualifications of the approach developed in their work The Calculus of Consent (1962), p. 30:
The voice of public choice :
"Public-choice economics assumes that government figures are merely human. They should be expected to look out for themselves rather than to act as saintly public stewards. It is a cynical (and, some might say, obvious) approach but a useful one. John Maynard Keynes may have been spot-on in concluding that big government deficits could boost a sagging economy. But Mr Buchanan reckoned such arguments led to a slow erosion of the “old-time fiscal religion” that taxes should be raised to meet government obligations. This made spending less politically costly, because politicians no longer felt under pressure to pair new spending with higher taxes. That, he rightly predicted, would lead to an era of persistent, big fiscal deficits and growing debt.
Public-choice analysis quickly provided the lens through which government action is now viewed. Legislators may “logroll”, for instance, striking deals with colleagues to pass measures that benefit small groups but are of dubious value to the general public. Governments are racked by “rent-seeking”, whereby firms aim to capture financial returns through special government privileges or monopoly rights. A construction company may spend its time lobbying for government contracts rather than courting private business, for example. That absorbs not only the resources of the firm eventually granted the privilege but also those of other firms competing for the same entitlement. As opportunities for rent-seeking expand, they siphon off resources from productive activities in the private sector and towards competition for government largesse. Public-choice theory counsels caution and care in expanding the role of the state."
From the Wikipedia article Public Choice:
"Buchanan and Tullock themselves outline methodological qualifications of the approach developed in their work The Calculus of Consent (1962), p. 30:
- [E]ven if the model [with its rational self-interest assumptions] proves to be useful in explaining an important element of politics, it does not imply that all individuals act in accordance with the behavioral assumption made or that any one individual acts in this way at all times… the theory of collective choice can explain only some undetermined fraction of collective action. However, so long as some part of all individual behavior…is, in fact, motivated by utility maximization, and so long as the identification of the individual with the group does not extend to the point of making all individual utility functions identical, an economic-individualist model of political activity should be of some positive worth."
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