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James Buchanan: Clubs and Alternative Welfare Economics

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  • Alain Marciano

    (MRE - Montpellier Recherche en Economie - UM - Université de Montpellier, UM - Université de Montpellier)

Abstract

Buchanan did not write "An Economic Theory of Club" to complement Samuelson's analysis of public goods, but to develop a radically different, form of welfare economics – in which there is no social welfare function and individual utility functions cannot be "read" by external observers. It was the perspective Buchanan adopted to analyze the pricing of public goods and services, and from which he also envisaged clubs. The main feature Buchanan attributed to clubs was to implement a condition that made no sense in Samuelson's framework but that was crucial in Buchanan's and clubs made Samuelson's collective condition useless. Buchanan and Samuelson disagreed over the allocation of the costs of the public good on each individual. To Buchanan, it was by relying on individual's preferences. To Samuelson, by using a social welfare function. This has not much to do with the nature of the good, its "physical properties" to use Buchanan's words.

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  • Alain Marciano, 2021. "James Buchanan: Clubs and Alternative Welfare Economics," Post-Print hal-03326422, HAL.
    • Handle: RePEc:hal:journl:hal-03326422
    DOI: 10.1257/jep.35.3.243
    Note: View the original document on HAL open archive server: https://hal.umontpellier.fr/hal-03326422
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    References listed on IDEAS

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    1. Julius Margolis, 1957. "Welfare Criteria, Pricing and Decentralization of a Public Service," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 71(3), pages 448-463.
    2. Richard Abel Musgrave, 1939. "The Voluntary Exchange Theory of Public Economy," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 53(2), pages 213-237.
    3. Buchanan, James M. & Goetz, Charles J., 1972. "Efficiency limits of fiscal mobility: An assessment of the tiebout model," Journal of Public Economics, Elsevier, vol. 1(1), pages 25-43, April.
    4. Alain Marciano, 2020. "How Wicksell became important for Buchanan: a historical account of a (relatively) slow epiphany," Post-Print hal-02550191, HAL.
    5. J. Wiseman, 1957. "The Theory Of Public Utility Price—An Empty Box," Oxford Economic Papers, Oxford University Press, vol. 9(1), pages 56-74.
    6. Marianne Johnson, 2010. "Wicksell's Social Philosophy and his Unanimity Rule," Review of Social Economy, Taylor & Francis Journals, vol. 68(2), pages 187-204.
    7. James M. Buchanan, 1949. "The Pure Theory of Government Finance: A Suggested Approach," Journal of Political Economy, University of Chicago Press, vol. 57(6), pages 496-496.
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    Cited by:

    1. Alain Marciano, 2023. "The Political Economy of Buchanan's Samaritan's Dilemma," Springer Books, in: Martin A. Leroch & Florian Rupp (ed.), Power and Responsibility, pages 345-357, Springer.

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