Academic journal article Harvard Journal of Law & Public Policy

Public Choice Theory and Occupational Licensing

Academic journal article Harvard Journal of Law & Public Policy

Public Choice Theory and Occupational Licensing

Article excerpt

b. The factual difficulty of analyzing bribery or extortion and political activity at the wholesale level

It could be argued that the difficulty in determining the intent of a collective body makes unworkable a rule that legislation is illegitimate for constitutional purposes if it is the product of the type of political bribery and extortion that Public Choice Theory describes and that the criminal law may prohibit. After all, an axiom of Public Choice Theory is that the apparent rationale for state actions does not necessarily align with the preferences of the decision makers, let alone their constituents. (389) It is therefore problematic to divine the motive or intent behind any particular statute because different legislators may be driven by entirely different concerns to support a particular law. (390) Indeed, because it is so difficult to divine the intent of a corporate body, the argument goes, the game is not worth the candle. In any event, what matters is a statute's effect, not the motivations of the legislators who voted for it. (391)

A court should avoid pursuing an inquiry that requires it to answer a factually unanswerably question ("What is the last digit in [pi]?"), that requires it to use an insolubly ambiguous standard ("What conduct is 'annoying'?" (392)), or that forces it to make a decision that is entirely a matter of policy ("Who would be the best Secretary of State?"). That concern is one of the reasons why courts deem some issues to be "political questions" that the judiciary should leave to the political branches for resolution. (393) That concern, however, is not present here. It certainly is difficult to divine the intent of a collegial body, but the task is not impossibly onerous. Indeed, the Supreme Court has ruled that the courts can and must undertake precisely that inquiry when a statute is challenged as having been motivated by race- or sex-based discrimination, in violation of the Fourteenth Amendment Equal Protection Clause. (394) Moreover, as explained above the Court has concluded that an intent-based inquiry is feasible and necessary in several other analogous contexts. In each of those settings the Supreme Court has concluded that a judicial inquiry into the legislature's rationale or motive is not merely permissible, but also necessary. (395) If a court can discern a collective body's intent or motive in those contexts, the court certainly can pursue the same inquiry in this one.

Public Choice Theory provides a useful means of analysis. It does not require courts to make political decisions; it enables the courts, simply but honestly, to analyze how the politics of the legislative process actually works. (396) As James Huffman has noted, "politics is seldom about principle and mostly about interests.... [T]he day-to-day business of government is almost entirely about the pursuit of competing private interests ..." (397) Moreover, the settings in which legislatures make occupational licensing decisions are readily susceptible to analysis using microeconomics and game theory, with a dollop of historical analysis for good measure. Courts have often employed these tools to analyze decisionmaking in fields such as antitrust and constitutional law. (398) They perfectly apply to an inquiry into the justification for occupational licensing because when and how often politicians resort to rent creation or rent extraction is subject to the laws of supply and demand, economic and political. (399) Microeconomics, game theory, and history supply objective indicia that courts can use to avoid falling into the trap of substituting their own policy preferences for legal analysis.

Public Choice Theory teaches that interested parties and politicians use and respond to incentives in the private and public markets. (400) They will spend resources in pursuit of a benefit (or avoidance of a loss) up to the point where their individual marginal cost and marginal income curves intersect. …

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