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Über dieses Buch

“Dowding and Taylor offer student and scholar alike a clear and compelling perspective on the foundations of political economy. Their narrative coherently frames the scholarship of the last half century, and persuasively applies it to the recurring problems facing groups, markets, and whole societies.”—Kenneth A. Shepsle, Harvard University, USA
This book introduces and applies the economic way of thinking to public policy and public administration. It provides a non-technical introduction and assumes no prior economic or mathematical training but looks closely at the methodological and normative assumptions underlying economic analysis. It provides a deep understanding of the method than a simple technical presentation would allow. After introducing the basic assumptions of the economic method, the book considers the analysis of market failure, the role of government in a market economy, behavioural economics, bargaining in government, bureaucracy, interest groups, and levels of government. By providing a balanced introduction to and overview of economic approaches to government, the book will be useful to undergraduate and postgraduate students in public administration and public policy, as well as academics and practitioners in these fields interested in the application of the economic way of thinking.

Inhaltsverzeichnis

Frontmatter

Chapter 1. Introduction

Abstract
This chapter introduces the economic or public choice approach to studying politics and public administration. It explains the rationality assumptions as predictive devices and how they are applied to types of agent rather than biological ones. It introduces the idea of formal models to provide predictions and how they can be applied to actual social and political processes. It introduces four concepts central to this way of thinking: opportunity costs, incentives, thinking at the margin and voluntary trade. It then introduces the main themes of several schools of public choice and then introduces the themes of the rest of the book.
Keith Dowding, Brad R. Taylor

Chapter 2. Markets, Market Failure and the Role of Government

Abstract
This chapter introduces Pareto efficiency as the key normative concept of welfare economics and describes the conditions under which we expect efficiency or market failure. We pay particular attention to the existence of externalities and show how these can, but do not always, cause markets to fail. Whenever there is market failure it is conceptually possible for government to intervene in order to improve outcomes. Government failure also occurs, however, and so such intervention is not always practical. When considering imperfect alternatives, we must engage in comparative institutional analysis.
Keith Dowding, Brad R. Taylor

Chapter 3. Irrationality and Public Policy

Abstract
This chapter explains the critique of mainstream economics from behavioural economics. Research by economists and psychologists shows that people are irrational in ways which violate the basic assumptions of economic theory. Humans use heuristics which lead to biases, and decisions can be influenced by framing effects. Such irrationality widens the scope for government intervention, particularly through libertarian paternalist policies which nudge people in the right direction without explicit coercion.
Keith Dowding, Brad R. Taylor

Chapter 4. Collective Choice and Bargaining

Abstract
This chapter examines collective choice and bargaining within the government. It explains the problems of collective choice described by Arrow’s theorem which suggest that no voting rule is able to simultaneously meet a number of conditions meant to describe a minimal normative standard for democracy. It outlines some simple spatial models of bargaining within governments. It then shows how many of the relationships that exist within government can be represented by principal–agent models, the problems caused by such relationships and how these can be mitigated. This approach is applied to the prime minister controlling her ministers and how much discretion a government will give to its civil servants.
Keith Dowding, Brad R. Taylor

Chapter 5. Bureaucracy and Levels of Government

Abstract
This chapter considers the principal–agent problem with regard to public bureaus. It examines budget-maximizing, the related setter model, bureau-shaping and the effects of lobbies on government through rent-seeking activity. It finally examines the argument that different levels of government can help the public sector operate more efficiently through Tiebout competition, quasi-markets, polycentricity and fiscal federalism.
Keith Dowding, Brad R. Taylor

Chapter 6. Conclusion

Abstract
This concluding chapter brings together the major lessons of the book to consider some major criticisms of economics as a discipline and its application to government. Although such criticisms are not without merit, the economic method remains a useful tool for the positive and normative analysis of government.
Keith Dowding, Brad R. Taylor

Backmatter

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