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The Distinction between Clubs and Governments

In: The Economic Foundations of Government

Author

Listed:
  • Randall G. Holcombe

    (Florida State University)

Abstract

The economic model of government is based on exchange. Individuals find it in their mutual self-interests to create constitutions that define individual rights and the limits of government power, and to grant governments the means to monitor and enforce the structure of rights defined by the constitution. While based on exchange, the model differs from what has sometimes been referred to as the exchange model of government because threats as well as promises could be used to encourage the observation of rights, so the resulting government could be forced upon some individuals.1 The use of the word force is not unambiguous in this context, however, especially in light of the contractarian model of the state. In what sense might people be said to be in agreement with the constitution under which they are governed? Looked at in another way, clubs might be thought of as institutions that their members voluntarily agree to join, whereas people are forced to abide by the rules of their governments whether or not they agree. What distinguishes a club from a government?

Suggested Citation

  • Randall G. Holcombe, 1994. "The Distinction between Clubs and Governments," Palgrave Macmillan Books, in: The Economic Foundations of Government, chapter 5, pages 72-91, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-349-13230-0_5
    DOI: 10.1007/978-1-349-13230-0_5
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    Cited by:

    1. Nathan J. Ashby, 2007. "Economic Freedom and Migration Flows between U.S. States," Southern Economic Journal, John Wiley & Sons, vol. 73(3), pages 677-697, January.
    2. Nathan J. Ashby, 2007. "Economic Freedom and Migration Flows between U.S. States," Southern Economic Journal, Southern Economic Association, vol. 73(3), pages 677-697, January.
    3. George Crowley & Russell Sobel, 2011. "Does fiscal decentralization constrain Leviathan? New evidence from local property tax competition," Public Choice, Springer, vol. 149(1), pages 5-30, October.
    4. Alexander Fink, 2011. "Under what conditions may social contracts arise? Evidence from the Hanseatic League," Constitutional Political Economy, Springer, vol. 22(2), pages 173-190, June.
    5. Nathan J. Ashby, 2007. "Economic Freedom and Migration Flows between U.S. States," Southern Economic Journal, John Wiley & Sons, vol. 73(3), pages 677-697, January.
    6. repec:wvu:wpaper:05-13 is not listed on IDEAS

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