Why Do Governments Lack â€œPolitical Willâ€ ? An Explanation
This paper proposes â€œlack of political willâ€ as the most important reason why a ruling political party is unable to commit itself to economically efficient choices or policies. The notion of political will is explicated using concepts from the transactioncosts perspective. The paper models the interactions between an interest group and the ruling party on the one hand and between general electorate and the ruling party on the other as quid pro quo relationships or transactions. In the first type of transaction, the ruling party offers the interest group of favourable policy (say, subsidised public sector output) in exchange for political support. In the second transaction, the ruling party offers the general electorate subsidised welfare amenities (say, basic health care) in exchange for political support. The analysis in the paper shows that the transaction-costs associated with the interest group-ruling party exchange will be lower than the transaction-costs in the case of the general electorate-ruling party exchange. Consequently, the ruling party will implement policies which are inefficient for the point of view of the economy but which work to the benefit of the interest group.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Vito Tanzi, 1998. "Corruption Around the World; Causes, Consequences, Scope, and Cures," IMF Working Papers 98/63, International Monetary Fund.
- William D. Nordhaus, 1975. "The Political Business Cycle," Review of Economic Studies, Oxford University Press, vol. 42(2), pages 169-190.
- Pranab Bardhan, 1997. "Corruption and Development: A Review of Issues," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1320-1346, September.
- Moore, Mick, 1997. "Leading the left to the right: Populist coalitions and economic reform," World Development, Elsevier, vol. 25(7), pages 1009-1028, July.
- Pursell, Garry & Gulati, Ashok, 1993. "Liberalizing Indian agriculture : an agenda for reform," Policy Research Working Paper Series 1172, The World Bank.
- George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
- Moe, Terry M, 1990. "Political Institutions: The Neglected Side of the Story," Journal of Law, Economics and Organization, Oxford University Press, vol. 6(0), pages 213-53.
- Fernandez, Raquel & Rodrik, Dani, 1991. "Resistance to Reform: Status Quo Bias in the Presence of Individual-Specific Uncertainty," American Economic Review, American Economic Association, vol. 81(5), pages 1146-55, December.
- Ajit Karnik, 2005. "Economic Reforms, Electrol Politics A Welfare," Working Papers id:103, eSocialSciences.
- Gary Clyde Hufbauer & Kimberly Ann Elliott, 1994. "Measuring the Costs of Protection in the United States," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 77, January.
- Buchanan, James M, 1988. "Contractarian Political Economy and Constitutional Interpretation," American Economic Review, American Economic Association, vol. 78(2), pages 135-39, May.
- Vito Tanzi, 1998. "Corruption Around the World: Causes, Consequences, Scope, and Cures," IMF Staff Papers, Palgrave Macmillan, vol. 45(4), pages 559-594, December.
When requesting a correction, please mention this item's handle: RePEc:ess:wpaper:id:102. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Padma Prakash)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.