Two Frameworks
• One normative
• One theoretical/analytical
• The Democracy Question
– Elite theory
– Pluralism
• Political economy approach (a.k.a rational
choice, public choice)
What is a political economy
approach?
a. This approach asks how individual
values and preferences get translated
into collective processes and outcomes.
This approach is directly related to
debates about the meaning and operation
of democratic systems; it is centrally
concerned with how collective
enterprises, from neighborhoods to
nations, operate.
b. Traditionally, economics studied behavior in
the marketplace and assumed that individuals
pursued their private interests; political
science studied behavior in the public arena
and assumed that individuals pursued their
own notion of the public interest.
Thus, separate versions of human motivation
developed in economics and political science;
the idea of homo economicus assumed a
self-interested actor seeking to maximize
personal benefits; that of homo politicus
assumed a public-spirited actor seeking to
maximize societal welfare.
c. The political economy approach adopts
the homo economicus model of human
behavior and applies it to the public
arena.
Political Economy Approach assumptions:
1.
2.
3.
Human behavior is purposive (Utility Maximizing)
People’s behavior is shaped by incentives and
constraints (rational)
People are intelligent and creative (strategic)
Purposive
1)
Purposive: people do things to advance their own
goals and objectives. People have preferences
over policy outcomes.
What might this mean for politics and Policy?
Different preferences = conflict
Conflicting preferences = multiple policy alternatives
Which policy and which policy outcome is chosen?
Persuasion, Bargaining, Coercion
Incentives Matter
2) Shaped by Incentives: People respond to
their environment. They respond to
incentives and disincentives.
Examples?
People are Intelligent & Creative
3) They are strategic in that they are
aware of rules and constraints and will
respond in the appropriate manner, in
a creative manner.
The Irrationality of Rationality
Individual Preferences Versus Collective
Outcomes:
Bickers and Williams attempt to show how there is
often a tension between individual preferences
and collective outcomes and how these
tensions are inherent in a democracy.
The starting point of the political economy
approach to policy analysis is the distinction
between individual preferences and collective
outcomes.
The Cleveland Browns and
Rational Choice
What do the Cleveland Browns have to do
with the Political Economy approach to
policy studies?
So how do we solve this
problem?
How do we solve this dilemma, this tension
between individual preferences and
aggregate outcomes?
Institutions
We can develop institutions to help
translate preferences into collective
outcomes that are beneficial to large
groups of people. But not all
institutions are alike, different
institutions function differently.
The political economy approach is interested
in how institutions translate our individual
preferences into policy outcomes.
•
Institutions may be inefficient (cost to much to
respond to our demands)
•
They may cause hidden effects and costs (negative
externatilities)
•
Can misrepresent preferences (elections 2002,
1980, small shift led to large change in Senate).
[Limits of geographic representation]
The PE approach is interested in how
institutions may be created to produce
incentives for public officials not to
respond to our preferences:
– Campaign contributions
– Bureaucracies
– Separation of powers
So institutions can help or hinder us getting
what we want and they can sometimes
create negative consequences when
producing the things we want. We would
like to structure institutions so that they
will give us what we want more times
than not and produce fewer negative side
effects.
How do Political Economists Think
1. Take trade-offs seriously – most people
feel that if something is good overall,
admitting any downside is strategically a
bad idea.
2. Think of statistical people – move away
from anecdotal stories about individual
3. Selfishness is a major principle of social
organization and it often an effective
principle
4. Interested in interactions between individuals
and group – not interested in conspiracy
theories (doesn’t mean that some people have
much more power and influence)
5. incentives matter
6. non-decisions are also important and yield costs
(forgone benefits) (opportunity costs)
7. Markets are powerful forces of nature, but they
are not perfect. Market failures.
DEMOCRATIC GOVERNANCE &PUBLIC
POLICY
The Role of Government
GOOD
Instruments of Collective Action
What does this mean: mobilize individuals and
resources (labor, energy, money)
To do what?
BAD
Infringe on individual liberties and freedom; attach other
nations
TRADE OFFS: GOOD&BAD
Crime Policy: infringe on individual liberties in order to
protect the public good. i.e. drug policy (leads to
property crime/violence)
Question: How do we determine whether our
government is doing what we want it to
do? What is the standard to measure
government performance? How do we
evaluate our government?
Do we focus on the process or the
outcome?
DEMOCRATIC THEORY: HOBBES,
LOCKE, ROUSSEAU, AND RAWLS
The relationship between man and State - Social
Contract Tradition (17th century): countered the
common notion of a “highly constrained,
hierarchical systems of social relations into
which all humans were born and stayed
throughout their entire lives.” Where the
authority to rule, it was claimed, came from
God.
Social contract tradition: government should be
founded upon the choices and consent of the
people.
Thomas Hobbes?
Thomas Hobbes (1588- 1679): humans are
greedy-need the state to protect us. We
are willing to give up freedoms in order
for protection, order, safety. We can see
this after 9-11 and our willingness to give
up certain rights.
John Locke?
John Locke (1632-1704):
Natural laws = rights from God.
“Life, liberty, property” - T. Jefferson
plagiarizes Locke in the Declaration of
Independence. Most people respect these
natural laws - of course there are a few
bad apples. Yes we do need a govt. but
only a limited one. The only legitimate
govt. action is the action the public
consents to.
Rousseau
Jean-Jacques Rousseau (1712-1778) –public holds
preferences for government action that are
reprehensible. “the general will is always right,
but the judgment that guides it is not always
enlightened.” What does right mean?
Rousseau suggests that we set up institutions that
people ought to have and then teach them what
they ought to want. (is this elite theory?).
Democratic theory presumes that preferences should
determine public policies, assuming that public
opinion/preferences are generally socially
acceptable.
What happens in a democracy when
people act in socially unacceptable or
selfish ways?
• Suppression of minorities?
• Inefficient policies?
• Solutions?
Rawls: Veil of Ignorance
Rawls veil of ignorance: don’t know anything
about our characteristics, man woman, child
college student, etc. and then assess the
fairness of a policy.
Can we really be that objective?
Alternative: Acknowledging externalities - The
positive externalities of public education. Even
if you and your family go to private school (or
don’t have kids or are self taught) you will likely
benefit from public education via an educated
work force which leads to a higher GDP, which
leads to a higher quality of life for most, or
through lower crime rates, or because you do
not have to train (as much) your new
employees.
TOPDOWN POLICYMAKING
I. Framework of the class: Democracy?
We are going to be covering a lot of information in this
class;
We are going to talk about the constitution, voting, media,
congress, courts, you name it. And how all these
interact to form policy outcomes. In order to help us
get through this material it would help if we had a sort
of framework. The two textbooks (Bickers/Williams &
Dye) that we’ve started to read have both started their
stories of public policy by mentioning the term
democracy. Perhaps this is a good framework frame
the lectures around.
Evaluating Democracy
More Broadly - we will reflect on the ways in
which the American way of doing things
achieves desired goals and serves us well or
poorly.
We will also ask, does this policy benefit some
and not others?, does this institution favor
some groups over other, do some groups have
more access to this bureaucracy or politician?
Why is Democracy Important?
But before we define democracy - why would we as a class
be interested in democracy or use this ideal in
structuring our class.
1.
it's part of our history and our culture, De Tocqueville
was amazed as to our egalitarian and democratic way
of life in the 1830s
2.
it is believed to be the best form of government to
protect individual rights
3.
that the pooled knowledge and experience of all
citizens is more capable of ruling than a few oligarchic
leaders.
Dictionary Definition
Greek roots
demos (the people)
ocracy – kratein (to rule)
the rule of the people
What are the characteristics that
make up a democratic state?
Not an easy questions.
To make it easier - think of a list of five
countries: Iran, U.S., Sweden, Mexico,
and Russia. Which ones are
democracies, or in more objective terms which one is the most democratic and
which one is the least. Why? What
characteristics make one country more
democratic than another.
Possible measures of Democracy:
• Competitive elections
• Media free from government pressure
• Voting
• Other Types of Political Participation
• Number of interest groups/political parties
Others?
Fundamental Principles of
Representative Democracy
1. Popular sovereignty
2. Political Equality
3. Political Liberty
Popular Sovereignty
a. govt. policies reflect people's
preferences
b. Majority rules. Narrow interest should not
dominate in the political process.
Political Equality
Each person caries the same weight in
voting and other political decision making.
What about equal access to political office?
What about economic equality?
Political Liberty
Is the idea that the government will not
interfere with an individuals exercise of a
range of different rights. The question is
what rights are protected?
Political v. Private Liberty?
political liberty is the tricky one. Because it may
conflict with the other principles of democracy
such as majority rules.
If a majority of us say that the richest 5% of the
nation has to give up half of their money to us,
the poor part of the population.
Limits on Campaign contributions, may hinder a
persons liberty while enhancing political
equality, which stresses that each persons
carries the same weight in the political process.
Conflicting Values
Liberty mean that a disliked minority has a voice.
KKK has a right to hold a rally, or that we give the
right of marriage to homosexuals
The bottom 50% of society (income wise) hold less
than 15% of the the wealth – where as the
richest 1% hold about 15% of the wealth in this
country. Majority Rule means that the bottom
50% can vote to tax the hell out of the richest.