An Economic Analysis of Democracy

By Randall G. Holcombe | Go to book overview

6 / Distributive Government

The preceding chapters have built a framework within which governmental activity can be analyzed. The role of this chapter is to extend that framework and to develop a simple model of distributive government. The model will be developed using economic theory and will be explained in economic terms. This is not meant to imply that the model only applies to strictly economic activities of government but, rather, that governmental activities can in general be analyzed in economic terms. Representative bodies typically make their decisions by majority rule, and in representative bodies, vote trading and logrolling are commonly used methods of generating enough votes to produce a majority. These exchanges are economic activity and can be beneficially analyzed using economic methods. This chapter will use economic methods to develop a model of distributive government and to argue that governmental activity in general can be viewed as purely distributive.

Analysts of government have characterized governmental activities in many ways, ranging from wealth or power maximization to the provision of public goods and services. At one level, the analyst can examine what the government ought to do and can come up with a list that may range from the protection of individual rights to producing those public goods and services that are desirable, but that will not be produced in the private sector because of incentive problems. However, if incentive problems exist in the private sector, they surely exist in the pub-

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An Economic Analysis of Democracy
Table of contents

Table of contents

  • Title Page iii
  • Contents v
  • Figures vii
  • Tables ix
  • Preface xi
  • 1 - Introduction 1
  • 2 - The Origins of Democracy 15
  • 3 - The Median Voter 38
  • 4 - Coalitions and Stability In Multidimensional Issues 67
  • 5 - Taxes and Redistribution 95
  • 6 - Distributive Government 118
  • 7 - Interest Groups And Distributional Activity 143
  • 8 - The Government Budget Constraint 162
  • 9 - Cycles, Stability, And Economic Efficiency 186
  • 10 - The Growth of Government 208
  • Notes Bibliography Index 231
  • Notes 233
  • Bibliography 257
  • Index 267
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