Collective Interests and Policy Outcomes
The chapters in this part share a common analytical approach, which is a venerable one in political analysis. They presuppose that social outcomes derive from contending group interests and are best explained in reference to group preferences. This does not mean that social groups are always well organized or even have well-thought-out notions of their collective interest. Sometimes the groups emerge as implicit coalitions around issues or economic transformations; and of course they can always choose policies that are counterproductive to what outsiders might deem their real long-term interests. The point is that the approaches here suggest that more can be understood about inflationary processes by focusing on group rivalry than upon aggregating idealized individual preferences.
In chapter 3 Albert Hirschman seeks to generalize lessons from an area of the world where inflation has been endemic since the early twentieth century and especially since World War II. Latin America is instructive, not because the North Atlantic societies are closely comparable, but because Latin American inflation starkly suggests some of the possible social mechanisms that may be in play. Hirschman's focus is less on specific social groups than on the general patterns of economic rivalry that create a vulnerability to inflation. Robert Keohane, in chapter 4, borrows some of Hirschman's concepts to explore how political rivalry between nation states influences economic outcomes, and vice versa. Keohane stresses not groups within nations, but states as the collective actors within international systems. Obviously, as the history of the