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People Are People

While some of economics has remained unchanged, new sub-fields have emerged over the course of its history. Public Choice is one such example.

"As James Buchanan artfully defined it, public choice is 'politics without romance.' The wishful thinking it displaced presumes that participants in the political sphere aspire to promote the common good. In the conventional 'public interest' view, public officials are portrayed as benevolent “public servants” who faithfully carry out the “will of the people.” In tending to the public’s business, voters, politicians, and policymakers are supposed somehow to rise above their own parochial concerns." (from the Concise Encyclopedia of Economics)

Instead, Public Choice operates under the assumption 'people are people," whether in the check-out or legislative aisle, the voting booth or the shopping center. They face trade-offs and their behavior is guided by incentives.
 

Here, we've collected a variety of resources to help you explore this dynamic means of analyzing economic and political activity. We hope you enjoy.

Connect with all of us on social media, and/or drop us a line with suggestions for future issues at econlib@libertyfund.org. We love to hear from you!

Biography: James M. Buchanan
 After beginning his career as a "libertarian socialist," James Buchanan went on to co-found the Public Choice school of economics. He was awarded the Nobel prize in 1986 for his contributions. 

What About Market Failure?
Externalities, public goods, asymmetric information, and market power provide necessary—but insufficient—conditions for intervention to be justified. They certainly are not talismans that provide interventionists with carte blanche to tinker with the members of a society as if they were pieces on a chessboard.
 

A Conversation with James Buchanan
Nobel laureate James M. Buchanan (1919-2013) was recorded in 2001 in an extended video now available to the public. Universally respected as one of the founders of the economics of public choice, he is the author of numerous books and hundreds of articles in the areas of public finance, public choice, constitutional economics, and economic philosophy
Confronting Our Unicorns
Listen to this EconTalk podast with Mike Munger on crony capitalism, and then use these discussion questions to start a conversation with your students.
Biography: Gordon Tullock
Gordon Tullock, along with his colleague James M. Buchanan, was a founder of the School of Public Choice. Among his contributions to public choice were his study of bureaucracy, his early insights on rent seeking, his study of political revolutions, his analysis of dictatorships, and his analysis of incentives and outcomes in foreign policy. Tullock also contributed to the study of optimal organization of research, was a strong critic of common law, and did work on evolutionary biology. He was arguably one of the ten or so most influential economists of the last half of the twentieth century.
 
How We Failed our Economics Students
Examining our principles of economics textbooks, one finds the following type of logic: Markets have systematic failures such as externalities, monopolies, business cycles, and public goods, and there is a benevolent omniscient government that can and will come in, properly identify, and correct these things by imposing the ideal solution to the problem. What a disservice we as economists have done to our students! 
 
Podcast: Boudreaux on Public Choice
Don Boudreaux of George Mason University talks with EconTalk host Russ Roberts about public choice: the application of economics to the political process. Boudreaux argues that political competition is a blunt instrument that works less effectively than economic competition.
The Calculus of Consent
This is a book about the political organization of a society of free men. Its methodology, its conceptual apparatus, and its analytics are derived, essentially, from the discipline that has as its subject the economic organization of such a society. Students and scholars in politics will share with us an interest in the central problems under consideration. Their colleagues in economics will share with us an interest in the construction of the argument. This work lies squarely along that mythical, and mystical, borderline between these two prodigal offsprings of political economy.
The Tyranny of the National Interest
The national interest is simply the public interest where the public is the nation. So consider the more general concept of public interest. Economists have shown that in a society composed of individuals with different preferences, the public interest does not exist.
 
New Applications
Toward the end of his life, Buchanan, pessimistic about the spread of socialism, and devised three new ways we might look at the phenomenon. Read this book review of Socialism Sucks to learn more.
 
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