The Public Choice Revolution and Principles of Economics Texts

Following the publication of The Calculus of Consentin 1962, a new school of thought began to exert an impact on the economics profession. These changing winds are sometimes referred to as the “public choice revolution.” They eventually led to the awarding of the 1986 Nobel Prize to James Buchanan for his pathbreaking work in this area. Both Buchanan and the public choice literature exerted a major impact on my career and approach to economics. In essence, public choice applies the tools of economics to both the market and political processes. Without having knowledge about the operation of both, one is in a poor position to understand how alternative institutions and policies will affect outcomes. This comparative approach seemed so obvious to me, I incorporated it into my teaching of introductory economics in the early 1970s. Soon thereafter, I integrated the approach into a principles of economics text, Economics: Private and Public Choice.First published in 1976, this text is now in its 14th edition. Even though the book has been successful, I am nonetheless, disappointed that public choice has not exerted more impact on principles courses. Most introductory classes and texts continue to treat government as if it were an omniscient, benevolent dictator. Correspondingly, rather than analyzing how both markets and collective decision-making handle economic problems, most of the profession continues to focus on market failure, ideal solutions under restrictive assumptions, and the modeling of government as if it were a corrective device. This approach, which is particularly dominant at elite schools, undermines both the relevance and usefulness of economics. It is misleading and leaves students with a false, romantic view of government and the operation of the democratic political process. Thus, public choice analysis and the work of scholars like Buchanan and Tullock are just as relevant today as they were four decades ago. Hopefully, a new generation of economists will grasp this point and take the public choice revolution to new heights.