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Principles of political economy

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  • Jack Wiseman

Abstract

As a guide to efficient social organization, neo-classical economics is deficient in two major ways. First, it uses simplifying assumptions about the decision-environment which destroy its possible relevance to an understanding of decision situations in the real world: notably in its inability to embrace the unknowability of the future and the subjectivity of human decisions. Second, it specifies the nature of policy-relevant choice in too restrictive a fashion to explain the major (constitutional and political) choice-situations inherent in any system of social organization. A more satisfactory intellectual construct can be derived from a political economy-public choice model. This follows broadly the contractarian-liberal model developed notably by Buchanan and Brennan, but envisages a much more thoroughgoing rejection of neo-classical (Paretian) concepts. Thenew political economy would identifyefficiency with the ability of the citizen to constrain government-as-leviathan in a context of multi-level choice. The opportunity-cost situation of citizens-as-choosers is specified by reference to their ongoing possibilities of usingvoice to change unsatisfactory institutional constraints orexit to escape their consequences. The model is used to appraise the constitutional characteristics of fiscal federalism. Copyright George Mason University 1990

Suggested Citation

  • Jack Wiseman, 1990. "Principles of political economy," Constitutional Political Economy, Springer, vol. 1(1), pages 101-124, December.
    • Handle: RePEc:kap:copoec:v:1:y:1990:i:1:p:101-124
    DOI: 10.1007/BF02393035
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    References listed on IDEAS

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    1. Brennan,Geoffrey & Buchanan,James M., 2006. "The Power to Tax," Cambridge Books, Cambridge University Press, number 9780521027922, September.
    2. Jack Wiseman, 1989. "Cost, Choice and Political Economy," Books, Edward Elgar Publishing, number 472.
    3. A. Hamlin, 1985. "The political economy of constitutional federalism," Public Choice, Springer, vol. 46(2), pages 187-195, January.
    4. S. Littlechild & J. Wiseman, 1986. "The political economy of restriction of choice," Public Choice, Springer, vol. 51(2), pages 161-172, January.
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    Cited by:

    1. Michael Marlow, 1992. "Intergovernmental competition, voice and exit options and the design of fiscal structure," Constitutional Political Economy, Springer, vol. 3(1), pages 73-88, December.
    2. Anton Lowenberg & Ben Yu, 1992. "Efficient constitution formation and maintenance: The role of “exit”," Constitutional Political Economy, Springer, vol. 3(1), pages 51-72, December.
    3. John Mbaku, 1995. "Preparing Africa for the twenty-first century: Lessons from constitutional economics," Constitutional Political Economy, Springer, vol. 6(2), pages 139-160, June.
    4. Ludwig Van den Hauwe, 2005. "Constitutional Economics II," Chapters, in: Jürgen G. Backhaus (ed.), The Elgar Companion to Law and Economics, Second Edition, chapter 13, Edward Elgar Publishing.
    5. Vanberg, Viktor, 1990. "A Constitutional Political Economy Perspective on International Trade," 1990: The Environment, Government Policies, and International Trade Meeting, December 1990, San Diego, CA 50875, International Agricultural Trade Research Consortium.
    6. Michael Wohlgemuth, 1995. "Economic and political competition in neoclassical and evolutionary perspective," Constitutional Political Economy, Springer, vol. 6(1), pages 71-96, December.
    7. Charlotte Twight, 1992. "Constitutional renegotiation: Impediments to consensual revision," Constitutional Political Economy, Springer, vol. 3(1), pages 89-112, December.
    8. Guy Gilbert, 1996. "Le fédéralisme financier, perspectives de microéconomie spatiale," Revue Économique, Programme National Persée, vol. 47(2), pages 311-363.
    9. Anthony Evans, 2014. "A subjectivist’s solution to the limits of public choice," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 27(1), pages 23-44, March.
    10. Michael Wohlgemuth, 2002. "Democracy and Opinion Falsification: Towards a New Austrian Political Economy," Constitutional Political Economy, Springer, vol. 13(3), pages 223-246, September.

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