Political Economy and Public Finance: The Role of Political Economy in the Theory and Practice of Public Economics

There is a long-standing difference amongst public economists between those who think that collective choice must be formally acknowledged, and those who derive their policy recommendations from a social planning framework in which politics plays no role. The purpose of this book is to contribute to a meaningful dialogue between these two groups, in the belief that the future of both political economy and of normative public finance lies somewhere between the two approaches. Some of the specific questions addressed in the book include: does public finance need political economy? Should collective choice play a role in the standard of reference used in normative public finance? What is a "failure" in a non-market or policy process? And what have we learned about the theory and practice of public finance from three decades of empirical research on public choice? The book also provides a practitioner's view of the political economy of redistribution. The importance of political economy to any understanding of why public policy evolves as it does is now widely accepted by public finance scholars and practitioners. This work goes a step further by considering the role of collective choice in defining what constitutes "good" or "better" policy.

Table of Contents:
Contents: Preface 1. Political Economy and Public Finance: A Brief Introduction Stanley L. Winer and Hirofumi Shibata PART I: DOES PUBLIC FINANCE NEED POLITICAL ECONOMY? 2. Public Finance, Public Choice and the Political Economy of Regulation Geoffrey Brennan 3. Public and Welfare Economics under Monopolistic and Competitive Governments Albert Breton PART II: SHOULD COLLECTIVE CHOICE PLAY A ROLE IN THE STANDARD OF REFERENCE USED IN NORMATIVE PUBLIC FINANCE? 4. The Role of Public Choice Considerations in Normative Public Economics Robin Boadway 5. Better than What? Policy Analysis, Collective Choice and the Standard of Reference Walter Hettich Comments and a Rejoinder PART III: WHAT IS A ‘FAILURE’ IN A NON-MARKET OR POLICY PROCESS? 6. Normative Public Finance Without Guilt: Why Normative Public Finance is Positive Public Finance Donald Wittman 7. On the Origin and Identification of Government Failures William A. Niskanen Comments PART IV: WHAT HAVE WE LEARNED ABOUT THE THEORY AND PRACTICE OF PUBLIC FINANCE FROM THREE DECADES OF EMPIRICAL RESEARCH ON PUBLIC CHOICE? 8. Interest Groups, Redistribution and the Size of Government Dennis C. Mueller 9. The Effects of Fiscal Institutions on Public Finance: A Survey of the Empirical Evidence Gebhard Kirchgässner 10. Experimental Investigation of Collective Action Frans van Winden PART V: A PRACTITIONER’S VIEW OF THE POLITICAL ECONOMY OF REDISTRIBUTION 11. Equity Policy and Political Feasibility in the European Union Aníbal Cavaco Silva PART VI: WHERE DO WE GO FROM HERE? 12. Directions for Future Research Eugene Smolensky 13. Where Do We Go from Here? Heinrich W. Ursprung Comments Index

About the Author :
Edited by Stanley L. Winer, Canada Research Chair Professor in Public Policy, School of Public Policy and Administration and Department of Economics, Carleton University, Ottawa, Canada and Hirofumi Shibata, former President, Kanto Gakuen University, Japan

Review :
'The overall quality of the volume is excellent, so reading the entire volume would be worthwhile, and readers interested in the specific topics covered by any of the chapters would find those chapters helpful. The individual chapters can stand alone, but taken together the volume illustrates how public choice analysis can influence the subject matter of traditional public finance.'