Editor in Chief: Moh. Reza Huwaida Tuesday, September 18th, 2018

An Economic Approach to Deal with Elections (Public Choice)

Afghanistan is on the verge of parliament elections and it’s better to encourage people to participate in this important event but as Farid Zakaria, the famous, columnist of New York Times emphasized in his book, “the future of freedom:  liberal Democracy at Home and Abroad”, we can’t have real democracy without “knowledge and awareness” then we should read about public choice theory although some people think it is very pessimistic approach toward politic and maybe it’s not suitable in this verge of election but in fact, this theory is not against elections, but vice versa, it is emphasizing on your awareness and your demanding approach toward politicians and we know as economists say that the existence of the state is inevitable and government is an inevitable evil then we start our dynastic articles around “public choice”.
Public choice or public choice theory is “the use of economic tools to deal with traditional problems of political science”.
Its content includes the study of political behavior. In other words: Public choice theory is a branch of economics that was developed from the study of taxation and public spending. It emerged in the fifties and received widespread public attention in 1986, when James Buchanan, one of its two leading architects (the other was his colleague Gordon Tullock), was awarded the Nobel Prize in economics.
Public choice takes the same principles that economists use to analyze people’s actions in the marketplace and applies them to people’s actions in collective decision making. Economists who study behavior in the private marketplace assume that people are motivated mainly by self-interest. Although most people base some of their actions on their concern for others, the dominant motive in people’s actions in the marketplace—whether they are employers, employees, or consumers—is a concern for themselves. Public choice economists make the same assumption—that although people acting in the political marketplace have some concern for others, their main motive, whether they are voters, politicians, lobbyists, or bureaucrats, is self-interest.
In Buchanan’s words the theory “replaces... romantic and illusory... notions about the workings of governments [with]... notions that embody more skepticism.”
In the past many economists have argued that the way to rein in “market failures” such as monopolies is to introduce government action. But public choice economists point out that there also is such a thing as “government failure.”
That is, there are reasons why government intervention does not achieve the desired effect. For example, the Justice department has responsibility for reducing monopoly power in non competitive industries. But a 1973 study by William F. Long, Richard Schramm, and Robert Tollison concluded that actual anti-competitive behavior played only a minor role in decisions by the Justice department to bring antimonopoly suits. Instead, they found, the larger the industry, the more likely were firms in it to be sued. Similarly, Congress has frequently passed laws thataresupposedtoprotectpeopleagainstenvironmental pollution.But Robert Crandall has shown that congressional representatives from northern industrial states used the 1977 Clean Air Act amendments to reduce competition by curbing economic growth in the Sunbelt.
The amendments required tighter emissions standards in undeveloped areas than in the more developed and more polluted areas, which tend to be in the East and Midwest. One of the chief underpinnings of public choice theory is the lack of incentives for voters to monitor government effectively.
Anthony Downs, in one of the earliest public choice books, An Economic Theory of Democracy pointed out that the voter is largely ignorant of political issues and that this ignorance is rational. Even though the result of an election may be very important, an individual’s vote rarely decides an election.
Thus, the direct impact of casting a well-informed vote is almost nil; the voter has virtually no chance to determine the outcome of the election. So spending time following the issues is not personally worthwhile for the voter. Evidence for this claim is found in the fact that public opinion polls consistently find that less than half of all voting-age Americans can name their own congressional representative. Public choice economists point out that this incentive to be ignorant is rare in the private sector. Someone who buys a car typically wants to be well informed about the car he or she selects.
That is because the car buyer’s choice is decisive-he or she pays only for the one chosen. If the choice is wise, the buyer will benefit; if it is unwise, the buyer will suffer directly. Voting lacks that kind of direct result. Therefore, most voters are largely ignorant about the positions of the people for whom they vote. Except for a few highly publicized issues, they do not pay a lot of attention to what legislative bodies do, and even when theydo pay attention, they have little incentive to gain the background knowledge and analytic skill needed to understand the issues. Public choice economists also examine the actions of legislators. Although legislators are expected to pursue the“public interest”, they make decisions on how to use other people’s resources, not their own. Furthermore, these resources must be provided by taxpayers and by those hurt by regulations whether they want to provide them or not.
Politicians may intend to spend taxpayer money wisely. Efficient decisions, however, will neither save their own money nor give them any proportion of the wealth they save for citizens. There is no direct reward for fighting powerful interest groups in order to confer benefits on a public that is not even aware of the benefits or of who conferred them. Thus, the incentives for good management in the public interest are weak. In contrast, interest groups are organized by people with very strong gains to be made from governmental action.
They provide politicians with campaign funds and campaign workers. In return they receive at least the “ear” of the politician and often gain support for their goals.In other words, because legislators have the power to tax and to extract resources in other coercive ways, and because voters monitor their behavior poorly, legislators behave in ways that are costly to citizens. One technique analyzed by public choice is log rolling, or vote trading. An urban legislator votes to subsidize a rural water project in order to win another legislator’s vote for a city housing subsidy.
The two projects may be part of a single spending bill. Through such log rolling both legislators get what they want. And even though neither project uses resources efficiently, local voters know that their representative got something for them.
They may not know that they are paying a pro-rata share of a bundle of inefficient projects! And the total expenditures may well be more than individual taxpayers would be willing to authorize if they were fully aware of what is going on.