The Social Science Encyclopedia

Authors: Kuper & Kuper
Summary: In about 500 words, the entry defines public choice as "the application of the economist's way of thinking to politics", and is thus regarded as synonym for the economic theory of politics. After a brief mention to the forerunners of this approach, the entry describes the areas of its application and closes with a concise summary of the recent empirical research employing this framework.
Even though the term was coined in the 1960s, this approach was first used by Condorcet, then by Italian and Scandinavian scholars of public finance and also by Schumpeter.
Nowadays public choice focuses on four areas:
1) preference aggregation, which applies Condorcet's impossibility theorem;
2) party competition, which looks for equilibria when two or more voting-maximizer parties compete in the elections;
3) interest groups, i.e. the identification of the motives why they emerge given that they provide public goods;
4) public bureaucracy, which studies how bureacracies use their monopoly in the provision of public services to expand government competences.
The entry closes by noticing that considering government endogenous to the political and economic system, rather than as given, has wide ranging implications for the theory of economic policy.