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Quotation of the Day…
Posted By Don Boudreaux On May 9, 2013 @ 7:42 am In Myths and Fallacies,Reality Is Not Optional | Comments Disabled
… is from pages 264-265 of David Friedman’s superb 1996 book, Hidden Order ; this passage – which reflects deep Tullockian  wisdom – follows Friedman’s description of the standard economic argument that public goods  are likely to be underproduced when left in the hands of people motivated chiefly by their own self-interest:
An obvious alternative is to have the government produce the [public] good and pay for it out of taxes. This may or may not be an improvement. The mechanism we rely on to make the government act in our interest – voting – itself involves the private production of a public good. When you spend time and energy deciding which candidate best serves the general interest and voting accordingly, most of the benefit of your expenditure goes to other people. You are producing a public good: a vote for the better candidate. That is a very hard public good to produce privately, since the public is a very large one: the whole population of the country. Hence it is very badly underproduced. The underproduction of that public good means that people do not find it in their interest to spend much effort deciding who is the best candidate – which in turn means that democracy does not work very well, so we cannot rely on the government to act in our interest.
Charlie Goetz  - a leading scholar in law and economics (and former student of Jim Buchanan ) - frequently says that the economist’s question is “As compared to what?” Sadly, it’s a question that too few people – even too few economists – ask with sufficient regularity.
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URL to article: http://cafehayek.com/2013/05/quotation-of-the-day-628.html
URLs in this post:
 Hidden Order: http://www.amazon.com/Hidden-Order-Economics-Everyday-Life/dp/0887308856/ref=sr_1_1?s=books&ie=UTF8&qid=1314195951&sr=1-1
 Tullockian: http://oll.libertyfund.org/index.php?option=com_staticxt&staticfile=show.php%3Fperson=4113&Itemid=28
 public goods: http://www.econlib.org/library/Enc/PublicGoods.html
 Charlie Goetz: http://www.law.virginia.edu/lawweb/Faculty.nsf/FHPbI/3348
 Jim Buchanan: http://www.econlib.org/library/Enc/bios/Buchanan.html
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