Coursework: Theory of public choice. Public choice: concepts, rules and procedures Genesis of public choice theory

For a long time, the dominant belief was that the purpose of decisions made by individual politicians, political and state organizations, must provide the greatest benefit to society. K. Wicksell in 1897 first defined politics as a mutually beneficial exchange between citizens and social structures.

Subsequently, this idea was developed and reflected in the theory of public choice. During the 60-70s of the XX century. On the basis of the University of Virginia (USA) and the Polytechnic Institute of the same name, the founders of the theory of public choice formed the Virginia School. The leading developer of Te is the 1986 Nobel Prize winner in economics J.-M.-J. Buchanan, active supporters - G. Tullock, V. Nutter and others.

Buchanan James-Mc Gil born October 3, 1919 in Myorfreesboro (USA). He studied at the University of Tennessee, received a doctorate in economics (University of Chicago) and became a professor at the University of Tennessee. Subsequently, he worked as dean of the Faculty of Economics at the University of Florida and as a professor at the University of Virginia. Author of the works “Formula of Consent (1962, co-author G. Tullock), “Public finance and the democratic process” (1966), “Demand and supply of public goods” (1968), “The theory of public choice” (1972), “Restriction of freedom or from Anarchy to Leviathan "(1975)," Freedom in Constitutional Contracts: Perspectives for Political Economists "(1977)," Freedom, Market and State: Political Economy in the 1980s "(1986)," Political Economy of the Welfare State " (1988), etc. The book “Works” was published in Russian in 1997.

Member of the American Academy of Arts and Sciences, National Academy of Lincey (Italy), honorary doctor of the Romanian Academy of Economic Sciences, honorary doctor of Zurich, Hesse, Lisbon, London, Bucharest, Valladolid and other universities, honorary member American Economic Association. Nobel Prize Laureate.

J.-M.-J. Buchanan explores a problem that lies at the intersection of economics and theory government controlled. Intensifying government participation in business and economic regulation necessitates research into decision-making practices. It is necessary to ensure that the adoption of laws, the establishment of taxes, the distribution budget funds, other government decisions actually responded to the needs of society rather than individuals or business groups. The scientist believes that the priority should not be the choice of a specific policy (neo-Keynesian, monetary or other), but the restrictions of government regulation and regulation. Public choice theory examines the political market in which politicians, voters and government officials interact. By analogy with the traditional market of goods and services, the seller here is the politician, the buyer is the voter, and the state must perform intermediary functions. Politicians offer packages different programs actions, voters pay the price if purchased with their votes. According to scholars, the buying and selling of election programs forms the essence of modern representative democracy.

Public choice theory assumes that political behavior is based on the same logic as market behavior, and the question of its motives is derivative. Representatives of the theory have a negative attitude towards government intervention in economic life, believing that the market is not an effective regulator, but the state will be even worse. This theory examines how politicians' competition for votes leads to increased government intervention in the economy; how through government programs income is redistributed from the poor and rich to the middle classes; how small but cohesive political groups can prevail over a broad but dispersed political majority. Therefore, according to J.-M.-J. Buchanan and his supporters, tools should be found that will connect practical and legal activity with neoclassical economic theory. In order to maintain the effectiveness of regulation, it is necessary to radically improve the mechanism of decision-making at the political level, to form a new system for making political decisions, similar to the one operating in the commodity-money market.

Buchanan believes that when applying the model of economic behavior to policy analysis, one should take into account the difference in the motives of behavior, and most importantly, between the structures of market and political systems. The basis of the theory of public choice is the application of an economic approach to the analysis of political processes. Political decisions are choices alternative options. If in the market people exchange apples and oranges, then in politics they pay taxes in exchange for public goods. This exchange is irrational, because often some subjects pay taxes, while others receive benefits from taxes.

In the political market, instead of the principle of "one dollar - one vote", the principle of "one person - one vote" applies. It is with this that public choice theorists associate the high probability of the emergence in the sphere of politics of results that are suboptimal from the point of view of society. Citizens in the political process cannot be guided by the rules of trade, since the consumer of public goods is not an individual, but society as a whole. But in politics there is still an analogue to free trade, Buchanan convinces. It is an agreement between people that is inherent in any kind of exchange. The unanimity in politics achieved by participants in a collective choice is similar to the voluntary exchange of individual goods on the market.

Public choice theorists propose a new concept for organizing the political market: reforming political procedures and rules so that they contribute to the achievement of general consent. Within the framework of “political exchange,” two levels of public choice are distinguished:

1. Development of rules and procedures for the political game. For example, rules regulating methods of financing the budget, approval of state laws, taxation systems (in particular, the principle of unanimity, qualified majority, simple majority rule, etc.). This will allow decisions to be agreed upon. Buchanan calls the set of proposed rules, norms of behavior, and procedures “constitutions of economic behavior.”

2. Practical activities of the state and its bodies on the basis of accepted rules and procedures. Considering this criterion of fairness and efficiency political system should be the dissemination of rules economic game to the political process. Proponents of the theory of public choice believe that the state should perform protective functions and not take on the function of participating in production activities. They put forward the principle of protecting order without interfering in the economy; they propose to transform public goods into goods and services sold on the market. People and firms enter into agreements, implement contracts on mutual benefit without regulation by the state. The choice of political rules, the scientist warns, should not go beyond the limits of reality.

Being a supporter of constitutional amendments to form a balanced federal budget, J.-M.-J. Buchanan, based on the model of post-constitutional behavior, justifies the possibility for politicians to gain political support by increasing spending for special and social purposes, while simultaneously restraining the increase in taxes that could cover these costs. In total, the scientist’s works consistently substantiate the thesis that the scale of economic intervention of a state operating on democratic principles will require constitutional restrictions or constitutionally enshrined rules prohibiting the formation of budget deficits or limiting their size. This approach was approved by many parliaments of different countries.

On this moment scientists Western countries A series of studies have been carried out on the problems of bureaucracy, lobbying activities, wars and revolutions, charity, etc.

Ukrainian realities require a long period of time to optimize the relationship between the population and government bodies and improve the political mechanism. Manipulation must be limited public consciousness using proven technologies; teach citizens to weed out pseudo-information that is constantly supplied and introduced into the consciousness and subconscious by the political market. Ukrainian language should develop a kind of immunity to the manipulations of politicians and means mass media. Responsibility must become two-way: on the part of politicians and on the part of voters, who are responsible for the fact that their assessments and opinions are manipulated by “analysts” and “image makers.”

J.-M.-J. Buchanan showed that during the last 150 years of American history, the balance of government revenues and expenditures has been reduced to a negative balance, mainly during periods of war and economic crisis. In the first case, this leads to an increase in military appropriations, and in the second, a short-term decrease in tax revenues to the state treasury. IN Peaceful time When economic conditions were favorable, the budget balance was, as a rule, positive, and excess financial resources were used to pay off public debt.

The economist also analyzed the question of how a country with a huge public debt can exist, directing excess financial resources from tax revenues not to pay off the debt, but to the development of various social programs. At the same time, government spending on social budget items is being increased to serve the political interests of certain political groups in order to win the next elections.

According to the scientist, the theory of public choice helps to determine the principles for creating a fiscal system with which all citizens could agree. One of the most important advantages of the theory is that it complements the theories of both government spending and taxation. Taxes and budgetary allocations are interpreted as two sides of the same act of exchange of tax payments for public services, carried out between the state, on the one hand, and the recipients of benefits - voters (taxpayers) - on the other.

The creation of the theory of public choice, a relatively new branch in economics, provided J.-M.-J. Buchanan's popularity as an economist.

So, in the theory of public choice developed by Buchanan, the behavior of individuals in political sphere, that is, them political roles(voters, lobbyists, political party members, government officials, etc.) related to the outcomes that manifest themselves in their economic roles (buyers and sellers, entrepreneurs and workers, etc.). The scientist's goal was to study the ability of these individuals to make rational decisions that lead to their overall benefit and at the same time influence the political face of the entire society.

Long-term developments of J.-M.-J. Buchanan and his supporters led to the fact that the theory of public choice has become a separate section of economic science, studying the application of methods of economic theory to the analysis of making “non-market decisions”. This section is viewed as an economic analysis of political activity.

Public choice in the broadest sense of the word, it is considered as a field or space where there is competition not only of personal interests, but also of various concepts and programs in relation to public goods as the conscious creativity of the masses. In the course of such a competitive process, a holistic vision of the goals and prospects of social development is formed.

Public choice in the narrow sense is a kind of political market, which is characterized by the fact that in a representative democracy, people running the state (elected representatives and officials), maximizing their own well-being and pursuing their own goals, ensure the realization of public interests. Public choice is understood as a spontaneous process of action of the “invisible hand”, as a type of struggle for existence.

Thus, public choice is a mechanism for the non-market allocation of resources for the production of public goods, which is the process of identifying individual preferences regarding the quantity and specific types of public goods, as well as the process of making decisions regarding the supply and demand for goods through political institutions and political processes.

The origins of public choice can be found in the studies of D. Black (b. 1908), the works of mathematicians of the 18th-19th centuries who were interested in voting problems: J. A. N. Condorcet, T. S. Laplace, C. Dodgson (Lewis Carroll). However, it was formed as an independent branch of economic science only in the 50-60s. XX century

Consistently using the principles of classical liberalism and methods of microeconomic analysis, representatives of this theory actively invaded the area traditionally considered the field of activity of political scientists, lawyers, and sociologists. This intervention was called “economic imperialism.”

The object of analysis of the theory is public choice in conditions of both direct and representative democracy. Therefore, the main areas of her analysis are the electoral process, the activities of deputies, the theory of bureaucracy, regulatory policy and constitutional economics. J. Buchanan, D. Muller, U. Niskanen, M. Olson, G. Tulloch, R. Tollison, F.A. played an important role in their development. Hayek and other scientists.

Public choice theory is sometimes called "new political economy" since it studies the political mechanism for the formation of macroeconomic decisions.

The basic premise of public choice theory is that people act in the political sphere in pursuit of their self-interest and that there is no insurmountable line between business and politics.

Public choice theorychoice theory) is a theory that studies various ways and the ways in which people use government agencies for their own benefit.

“Rational politicians” support, first of all, those programs that contribute to the growth of their prestige and increase the chances of winning the next election. Thus, the theory of public choice tries to consistently implement the principles of individualism, extending them to all types of activities, including public service.

The second premise of public choice theory is the concept of “economic man (homo economicus).” Everyone - from voters to the president - is guided in their activities primarily by the economic principle, that is, they compare marginal benefits and marginal costs (and above all, the benefits and costs associated with decision-making).

In the works of the American economist J. Buchanan, Nobel Prize laureate in 1986, the position is developed that by creating legislative bodies through participation in the system of political elections, the population forms not only the totality of functioning state institutions, but also the system of bureaucracy. The institution of bureaucracy (as a generalized concept of the internal interests of the state apparatus) serves, first of all, according to Buchanan, the interests of various echelons of legislative and executive power.

Political life is considered by analogy with the ordinary market. In the “political market,” voters give “statesmen” votes in elections and taxes to the state budget, receiving in return public goods produced by the government (for example, military protection). Just as sellers and buyers of ordinary goods are concerned exclusively with maximizing personal benefits, so politicians and voters are concerned not with the illusory “common good”, but with increasing their personal well-being.

The concept of public choice questions the original rationale for an active role for the state in the economy. Achievements and successes of economic policy always have a certain price. The state neutralizes market problems, but sometimes it can have significant flaws in its activities. These failures are cases where the state is unable to ensure the effective distribution and use of public resources.

Within the framework of public choice theory, the main category of analysis is the individual who is capable of making rational decisions leading to the benefit of society as a whole. Public choice theory predicts how the behavior of an individual in various roles (for example, voter or taxpayer, lobbyist or political candidate) can affect the state of the political community as a whole .

Political mechanism of public choice. The process of making public (state) decisions in a parliamentary representative democracy

In the public sector, there is a mechanism of public choice - a mechanism for non-market distribution of resources for the production of public goods, which is a process of identifying individual preferences regarding the quantity and specific types of public goods.

It is the process of deciding the supply and demand for goods through political institutions and political processes.

Direct democracy(directdemocracy)- a political system in which every citizen has the right to personally express his point of view and vote on any specific issue. Direct democracy is typical for meetings of collectives of enterprises and institutions, the work of clubs and creative unions, party meetings and congresses. On a national scale, this is manifested in the selection of members of parliament or the president, and the holding of referendums.

Median voter model(median voter model)(Hotelling's rule)- a model that characterizes the tendency existing within the framework of direct democracy, according to which decisions are made in accordance with the interests of the centrist voter (a person occupying a place in the middle of the scale of interests of a given society).

On the one hand, this keeps the community from making unilateral decisions, from going to extremes. On the other hand, it does not always guarantee the adoption of the optimal decision.

In a representative democracy, the voting process and procedure become more complicated. In this model, citizens vote periodically, electing their representatives to governing bodies, and the elected representatives already vote on specific issues of public life.

Voters should have certain information about upcoming elections. Getting it requires time and money.

Rational ignorance- a phenomenon where an individual, weighing his benefits and costs, refuses to vote or other political action if his costs are higher than his benefits.

Representative democracy has a number of undoubted advantages, for example, it successfully uses the benefits of the social division of labor. Elected deputies specialize in making decisions on certain issues. At the same time, with representative democracy, it is possible to make decisions that do not correspond to the interests of the majority of the population, which are very far from the model of the median voter . Preconditions are created for making decisions in the interests of a narrow group of people.

A major achievement in the theory of public choice was the development of the theory of political rent, begun in 1974 by Anne Kruger. Search for political rentrent seeking) – it is the desire to obtain economic rent through the political process. Bureaucrats, participating in the political process, strive to carry out such decisions as to ensure that they receive economic rent at the expense of society.

Therefore, representatives of the theory of public choice consistently advocate for every possible limitation of the economic functions of the state. Even the production of public goods is not a reason, from their point of view, for government intervention in the economy, since different taxpayers benefit unequally from government programs.

They consider privatization to be a condition for an effective fight against bureaucracy; its content is the development of “soft infrastructure,” and the ultimate goal is the creation of a constitutional economy. The concept of “soft infrastructure” introduced by U. Niskanen means an increase in human economic rights (strengthening property rights, honesty and responsibility for fulfilling contracts, tolerance of dissent, guarantees of minority rights, etc.) and limiting the scope of state activities.

The politician reminds me of a man who killed his father and mother, and then, when he is sentenced, asks for his life on the grounds that he is an orphan

(Abraham Lincoln).

Society cannot function and develop effectively without coordinating the actions of its subjects. Coordination of actions can be based on the market mechanism and the mechanism of public choice. The public choice mechanism operates when the market mechanism does not operate efficiently.

The origins of public choice theory were the Swedish economist Knut Wicksell (1851-1926). The origins of the theory can be found in the studies of D. Black (b. 1908), the works of mathematicians of the 18th-19th centuries who were interested in voting problems - J. A. N. Condorcet, T. S. Laplace, C. Dodgson (Lewis Carroll). A separate direction was formed by the American economist Buchanan James-McGill (born in 1919). He published many works on this topic, in particular: “The Formula of Consent” (1962), “The Demand and Supply of Public Goods” (1968), “The Theory of Public Choice” (1972), “Freedom, the Market and the State” (1986) and etc. In 1986 Buchanan received Nobel Prize for "a study of constitutional and contractual principles in the theory of economic decision-making." Together with G. Tulloch, he organized the “Committee for the Study of Non-Market Decision Making” at the Virginia Polytechnic Institute, which was later transformed into the “Center for Public Choice Research.” In the USA, a special magazine “Public Choice” is published. Prominent representatives also included Gordon Tulloch, Kenneth Arrow, Mansur Olson, Friedrich Hayek

Public choice theory is based on three main prerequisites:

1) Individualism: people act in the political sphere, pursuing their personal interests and there is no line between business and politics;

2) Concept " economic man». Everyone - from voters to the president - is guided in their activities by the economic principle: they compare marginal benefits and marginal costs. Condition: MB>MC, where MB is marginal benefit, MC is marginal cost.

3) Interpretation of politics as a process of exchange. In politics, taxes are paid in exchange for public goods. This exchange is not very rational. Usually there are only one taxpayer, and others receive benefits from taxes.

Public choice is a set of processes of non-market coordination of individual actions through a system of political institutions. Unlike private, public choice is carried out at certain intervals and is limited to a circle of applicants, each of whom offers their own program. Voters have more limited choices than market buyers, primarily in terms of the information they have.

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Public choice theory. Concept and methodology of analysis

Public choice theory- one of the branches of economics that studies the various ways and methods by which people use government agencies for their own interests.

Before the emergence of public choice theory in the 1960s, many economists were involved in the search for optimal public policies under certain conditions. For example, they were looking for ways to reduce unemployment, curb inflation, develop national defense at minimal cost, and optimize road construction. They did this without taking into account whether the government of the country was autocratic or democratic, they made the assumption of benevolence of the state, that is, they viewed the state as adopting the best policies possible and implementing them honestly.

Public choice theory is based on three main premises:

• Individualism: people act in the political sphere in pursuit of their personal interests and there is no line between business and politics.
• The concept of "economic man". His behavior is rational. The rationality of the individual has universal significance in this theory. This means that everyone - from voters to the president - is guided in their activities by the economic principle: they compare marginal benefits and marginal costs.
• Interpretation of politics as a process of exchange. If in the market people exchange apples for oranges, then in politics they pay taxes in exchange for public goods. This exchange is not very rational. Usually there are only one taxpayer, and others receive benefits from taxes.

Proponents of this theory view the political market by analogy with the commodity market. The state is an arena of competition between people for influence on decision-making, for access to the distribution of resources, for places on the hierarchical ladder. But the state is a special kind of market. Its participants have unusual property rights: voters can elect representatives to the highest bodies of the state, deputies can pass laws, and officials can monitor their implementation. Voters and politicians are treated as individuals exchanging votes and election promises.

Proponents of public choice theory have shown that one cannot rely on voting results, since they depend to a large extent on specific decision-making regulations. The voting paradox (Condorcet paradox) is a contradiction that arises due to the fact that voting based on the majority principle does not ensure the identification of society's actual preferences regarding economic goods.

There are several techniques to resolve this paradox: lobbying, logrolling. Methods of influencing government officials by a non-political entity in order to make a political decision beneficial for a limited group of voters are called lobbying.

The practice of mutual support of deputies through “trading votes” is called logrolling. The classic form of logrolling is the “barrel of lard” - a law that includes a set of small local projects. To gain approval, a whole package of various proposals, often loosely related to the main law, is added to the national law, the adoption of which is of interest to various groups of deputies. To ensure its passage (adoption), more and more proposals (“fat”) are added to it until confidence is achieved that the law will receive the approval of the majority of deputies. This is fraught with danger for democracy, since fundamentally important decisions can be “bought” by providing partial tax breaks and satisfying limited local interests.

Government officials are thinking about how to ensure success in elections and get votes. At the same time, they increase government spending, thereby stimulating inflation. In turn, this leads to increased strict regulation, government control, and an inflated bureaucratic apparatus. As a result, the government concentrates more and more power in its hands, and the economy loses.

There are economic prerequisites for making ineffective decisions: dishonesty of officials, lack of responsibility, concealment of information, its distortion. And this gives rise to negative attitude voters to government decisions, orders, documents, laws.

Buchanan's concept involves reforming the existing system. Within the framework of “political exchange,” two levels of public choice are distinguished. The first level is the development of rules and procedures for the political game. For example, rules regulating methods of financing the budget, approval of state laws, and taxation systems. Among them there may be various rules: the principle of unanimity, qualified majority, simple majority rule, etc. This will allow finding agreed upon solutions. Buchanan calls the set of proposed rules, norms of behavior, and procedures the “constitution of economic policy.” Second level - Practical activities state and its bodies based on accepted rules and procedures.

The criterion for the fairness and effectiveness of the political system should be the extension of the rules of the economic game to the political process. The successors of public choice theory do not deny the role of the state. In their opinion, it should perform protective functions and not take on the function of participating in production activities. The principle of protecting order without interfering in the economy is put forward. Public goods are proposed to be converted into goods and services sold on the market. People and firms enter into transactions and carry out contracts for mutual benefit without regulation by the state.

Professional economists in democratic countries today are not so naive. They understand that political decisions in their countries are made through a process of collective choice in which efficiency is often only a secondary goal of its participants. Political decisions are made by elected politicians and partially by their appointed representatives of the executive branch. The political and economic future of these politicians depends on how well they can satisfy the interests of independent voters, special interest groups and political parties. Modern economists also know that even when their recommendations are faithfully passed into law, the bureaucrats responsible for implementing those laws usually think more about their own private interests than about the careful implementation of the provisions contained in the laws.

In addition to economists, the importance of studying the procedure for making political decisions in a democracy was also realized by political scientists, who, having united with the former, created in the late 1960s in the United States a society of scientists engaged in the study of public choice (Public Choice Society).

Scientists engaged in the study of public choice view the state as created by people in order to achieve their own goals through it, that is, as an instrument. However, the main difference between the state and an ordinary instrument is that no individual can manage it alone; in order to direct the state to achieve individual goals, it is necessary that a collective decision-making procedure be implemented. Each team member pursues his own goals, which can vary greatly from person to person. Representatives of public choice theory are trying to understand the nature of the interaction that results in collective decision-making, and the main objects of research are the collective, politicians and bureaucrats hired to implement the collective decision.

The problem of the effectiveness of government intervention in the economy

In market conditions, the state is unable to ensure the effective distribution and use of public resources. The reasons for this are:

1. Government intervention in pricing can lead to shortages and surpluses.
2. Imperfection of the political process (the practice of lobbying, logrolling, seeking political rent, etc.)
3. The government may make wrong decisions.
4. Government intervention that disrupts market equilibrium or dampens the effects of market relations can undermine market incentives.
5. The inability of the state to accurately predict and control the consequences of its decisions.
6. Government intervention entails the loss of freedom of choice of economic entities in decision-making.
7. The presence of time intervals in political processes.

Proponents of public choice proceed from the fact that government methods of regulation should not infringe on market mechanisms, should be justified within strictly limited limits, and aimed at correcting market failures.

Model of bureaucracy. Search for political rent. Political-economic cycle

Bureaucracy is an integral part modern state. The bureaucracy does not produce economic goods and derives part of its income from sources not related to the sale of the results of its activities. Legislative bodies participate in the formation of the executive apparatus, the purpose of which is to perform the functions of the state and protect the interests of citizens. Legislators are elected by citizens. The interests of the bureaucracy are represented in the search for political rent - activities associated with the use of political institutions to obtain or maintain any economic benefits. Proponents of the theory of public choice consistently advocate for every possible limitation of the economic functions of the state. They consider the condition for an effective fight against bureaucracy to be a political-economic cycle, where the basis is privatization, the content is the development of “soft infrastructure,” and the ultimate goal is the creation of an institutional economy. Political-economic cycles can be of two types: electoral, that is, associated with elections to government bodies; and generational, where cyclicality is expressed through the change of ruling generations.

A model of pressure group competition for political influence. Lobbying. Logrolling

In a representative democracy, the quality and efficiency of decisions depend on the necessary information and incentives that facilitate its transformation into political decisions. Interest groups concentrate their efforts on shaping the position of the authorities they need. Lobbying is an attempt to influence government officials in order to make a political decision beneficial to a limited group of voters. There are four mechanisms by which pressure groups can pursue their interests: reducing the costs of voting and obtaining information, especially for those voters who are most likely to support them, seeking to provide information to politicians because they have access to sources of information, providing financial and other support for politicians who represent their interests through so-called logrolling - concessions to politicians of their votes, that is, through mutual support of various groups and parties. When elected by a simple majority vote, a small group of voters has a significant incentive to trade their votes to further their own interests.

Models of interaction between politicians and voters. Public choice in direct and representative democracy

Democracy means power by the people. There are direct and representative democracy. In direct democracy, the decision-making institution is voting based on the majority principle (simple, qualified and relative majority). Voting according to the majority principle does not always lead to political decisions that are optimal for society (the paradox of voting). In direct democracy, a model of the median voter is formed - when decisions are made in accordance with the interests of the median voter. In a representative democracy, citizens periodically elect representatives to elected bodies of government. Public choice is carried out at certain intervals and is limited to a circle of applicants, each of whom forms proposals into a package of programs. Deputies specialize in making decisions on certain issues.

Conspiracy theory

Public choice theory partly explains the mechanisms studied by conspiracy theory (from the English conspiracy theory, conspiracy theory) - a set of hypotheses and summation of arrays of facts that explain local and global events or processes as the results of conspiracies of ruling (formally and informally) groups and elites aimed for conscious (long-term and total) management of certain socio-economic processes. Conspiracy theory is seen as one of the extreme variants of elite theory associated with public choice theory.