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Analyzing the case for government intervention in a representative democracy

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  • Besley, Timothy
  • Coate, Stephen

Abstract

The welfare economic method for analyzing the case for government intervention is often critized for ignoring the political determination of policies. The standard method of accounting for this critique studies the case for intervention under the constraint that the level of the instrument in question will be politically determined. We critize this method for its implicit assumption that new interventions will not affect the level of existing policy instruments. We argue that this assumption is particularly misleading in suggesting that political economy concerns must dampen the case for intervention.

Suggested Citation

  • Besley, Timothy & Coate, Stephen, 1997. "Analyzing the case for government intervention in a representative democracy," LSE Research Online Documents on Economics 2113, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:2113
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    File URL: http://eprints.lse.ac.uk/2113/
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    Cited by:

    1. Julián Costas-Fernández & Simón Lodato, 2022. "Inequality, poverty and the composition of redistribution," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 59(4), pages 925-967, November.
    2. Diermeier, Daniel & Merlo, Antonio, 2004. "An empirical investigation of coalitional bargaining procedures," Journal of Public Economics, Elsevier, vol. 88(3-4), pages 783-797, March.

    More about this item

    Keywords

    Government intervention; public choice;

    JEL classification:

    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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