Public choice

Economic theory applied to political science / From Wikipedia, the free encyclopedia

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Public choice, or public choice theory, is "the use of economic tools to deal with traditional problems of political science".[1] Its content includes the study of political behavior. In political science, it is the subset of positive political theory that studies self-interested agents (voters, politicians, bureaucrats) and their interactions, which can be represented in a number of ways – using (for example) standard constrained utility maximization, game theory, or decision theory.[1] It is the origin and intellectual foundation of contemporary work in political economy.[2]

In popular use, "public choice" is often used as a shorthand for components of modern public choice theory that focus on how elected officials, bureaucrats and other government agents can be influenced by their own perceived self-interest when making decisions in their official roles. Economist James M. Buchanan received the 1986 Nobel Memorial Prize in Economic Sciences "for his development of the contractual and constitutional bases for the theory of economic and political decision-making" in this space.[3]

Public choice analysis has roots in positive analysis ("what is") but is often used for normative purposes ("what ought to be") in order to identify a problem or to suggest improvements to constitutional rules (i.e., constitutional economics).[1][4][5]

Public choice theory is also closely related to social choice theory, a mathematical approach to the aggregation of individual interests, welfare, or votes.[6] Much early work had aspects of both, and both fields use the tools of economics and game theory. Since voter behavior influences the behavior of public officials, public-choice theory often uses results from social-choice theory. General treatments of public choice may also be classified under public economics.[7]

Building upon economic theory, the public choice has some core tenets that are predominantly adhered to. Due to this there is no decision made by an aggregate whole. Rather, decisions are made by the combined choices of the individuals. The second is the use of markets in the political system, which was argued to be a return to true economics.[8] The final is the self-interested nature of all individuals within the political system. However, as Buchanan and Tullock argued, "the ultimate defense of the economic-individualist behavioral assumption must be empirical...The only final test of a model lies in its ability to assist in understanding real phenomena".[9]

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