Remembering Economist James Buchanan

James M. Buchanan, a great economist, died today in Blacksburg, Virginia, at age 93. He and Gordon Tullock are the creators of Public Choice theory, which argues that tools of economics should be used to study politics. With Public Choice theory, the behavior of politicians, government officials, and voters as self-interested agents and their interactions in the political system are observed.

Today, economist Tim Groseclose saluted Buchanan's work and had this to say about Public Choice theory...

Before Buchanan and Tullock, the following would be a standard exercise of an economics researcher: The researcher would identify a “market failure” in a particular activity. For instance, he might show that, because a factory emits pollutants, it produces more than the socially optimal amount of output. The standard solution of the researcher would then be to argue that a bureaucrat should be given the power to regulate the output of the factory. Buchanan and Tullock pointed out that such research ignores standard economic tools when analyzing the bureaucrat. That is, economists would typically assume that the bureaucrat would ignore his own interests and work only for the public good. Buchanan and Tullock argued that if economists applied their own tools to the bureaucrat—and assumed that, like any other economic actor, he has personal motives that may differ from that which is optimal for society—then they’d realize that other problems arise from giving such power to the bureaucrat...

Click here to read the trailblazing book on Public Choice theory The Calculus of Consent: Logical Foundations of Constitutional Democracy by Buchanan and Tullock.

Also, be sure to view the YouTube video on the life and work of James Buchanan below.