James Buchanan has died

The economist who did more to explain how the modern world really works than anyone else.

The theory was called \”public choice\”. And the heart of it is that those who rule us are incentivised by just the same economic desires and motives as the rest of us.

This explains why PCS, the union of the taxmen, employs Richard J Murtphy. Sod all to do with the tax gap. All about calling for an increase the number of jobs for members of the taxman\’s union.

It explains why the Royal College of Nursing shouted all those years that nursing had to become a graduate profession. So that the wages for nurses would rise.

You can multiply out the examples as you wish. But I would and do argue that this aids more than almost any other modern day theory in making sense of the world.

In short, why is government so shite? Because governors are shits just like the rest of us.

It also provides a prop for my (quite possibly unreasoned, I admit that it might simply be prejudice) rejection of Keynesian fiscal stimulus. In effect, the statement is that allowing Ed Balls to spend more of our money will make everything better. Clearly, allowing Ed Balls to do so will not. But public choice theory tells us why even if we had a human being doing it instead of Ed, it still wouldn\’t work as advertised.

So Buchanan leaves us after a long life (he was 93) well lived. For he\’s aided us all in making sense of the universe around us.

Vale.

21 thoughts on “James Buchanan has died”

  1. Dennis The Peasant

    The measure of Buchanan’s greatness is the same used to measure the greatness of Smith, Friedman and Hayek… T that being by just how much he is ignored by today’s (so-called) bright boys of economics.

  2. My father explained this way of looking at the world to me when I was a boy. I suppose he could have come across Buchanan writing in a newspaper, say, but I suspect that this is just another case of an economist building a reputation on elaborating ideas that are familiar to people who are inclined to think critically about what they see around them. This is not to deny that such elaboration might be illuminating.

    An example is the fuss made about The Tragedy of the Commons, when the issues were well understood by our medieval ancestors and perhaps by our neolithic ancestors too.

  3. He was a student of arguably one of the most powerful intellectual influences in my life, the late Lord Bauer, who revolutionised the treatment of Developmental economics, and was in his own way, just as influential. That Public Choice theory is taken for granted by everyone to the extent that Murphy and his acolytes are forced to deny the concept is a measure of his influence.

    A truly sad loss, and one in the current climate dominated by the Charlatans of the Left like Murphy and his appalling sidekicks Jones, Toynbee and other abominations from the Grauniad and Independent school of thought that is even more tragic, but here and now arguably is neither the time nor the place for a diatribe.

    Sincere condolences to his family and friends and RIP.

  4. “Clearly, allowing Ed Balls to do so will not. But public choice theory tells us why even if we had a human being doing it instead of Ed, it still wouldn’t work as advertised.”

    I see what you did there. Very clever.

    Tim adds: Rilly? “clever”?

    Standard rhetorical trope old boy. Several thousand years old.

  5. Tim, I don’t think there’s anything in your examples that wasn’t stated pretty explicitly by Smith. I must read Buchanan though. May he rest in peace.

  6. I agree with dearieme. That some part of all of the behaviour of politicians and the state’s agents (like the rest of us) is self-interested is a statement of the bleedin’ obvious. Buchanan essentially took a commonsense intuition and formalised it in a model. All credit to him, but it says more about the stupidity of all other economists than about Buchanan’s genius that the former ever assumed that politicians and agents of the state were not part of the economic nexus and behaved differently to the rest of humanity.

  7. And Tim:

    “Clearly, allowing Ed Balls to do so will not. But public choice theory tells us why even if we had a human being doing it instead of Ed, it still wouldn’t work as advertised.”

    Does public choice theory say that? All it claims, as I understand, is that some part of all Ed’s behaviour will be economically self-interested: it does not say that all his behaviour will be so.

    Surely, there are other, better ways of criticising Ed’s schemes – – eg the Hayekian point that Ed’s knowledge of the economy is necessarily incomplete.

    Tim adds: You’ve slightly missed my point. I reject, through prejudice, the Keynesian idea because it means Ed gets more of our money. I’m not particularly criticising Ed: rather, Keynesianism.

  8. Dennis The Peasant

    “That some part of all of the behaviour of politicians and the state’s agents (like the rest of us) is self-interested is a statement of the bleedin’ obvious. Buchanan essentially took a commonsense intuition and formalised it in a model. All credit to him, but it says more about the stupidity of all other economists than about Buchanan’s genius that the former ever assumed that politicians and agents of the state were not part of the economic nexus and behaved differently to the rest of humanity.”

    Genius is, very often, the ability to point out that which should be obvious (but isn’t).

    Tim adds: Quite so Dennis, quite so. There’s an amazing number of things that are obvious immediately after someone points them out.

  9. Think you’ve got some dodgy HTML code in your ‘rude and crude’ post: it’s screwing up your front page, and its own.

  10. “Genius is, very often, the ability to point out that which should be obvious (but isn’t).” The point is that it may not have been obvious to the Economics trade, but it had been obvious to the intelligent layman, I suspect, since time out of mind.

  11. Ross, I was trying to think of a snappy reply, but nothing came. I realised I don’t even remember what President Buchanan did. The Missouri Compromise??

  12. oh yes dearieme…so why did the commons get enclosed and the Newfoundland fisheries expire? Did your daddy tell you that, along with how he invented calculus and quantum mechanics?

  13. Pingback: James Buchanan (1919-2013) « O Insurgente

  14. I thought the nurses thing arose from the desire of the leaders to have everyone go to university and be a gent/lady.
    Then they thought that nurses would be cheaper and mjore tractible than doctors.
    More interestingly is why a great and strong leader hasn’t arisen of late – someone everyone could follow with acclaim. Ie real public choice.

  15. Sorry, Tim, de mortuis nil nisi boum and all that, but I’d like to see a bot more proof for the contention that

    “It explains why the Royal College of Nursing shouted all those years that nursing had to become a graduate profession. So that the wages for nurses would rise. ”

    That development could equally very well be explained by the expansion of theory based education which has been going on for fifty years at least. Read Robert Hughes, ‘Culture of Complaint’. Although Hughes dealt with theory based education in the liberal arts, the same process has been applied to the study of law, which is why recent law graduates seem to know everything you need to know about the death penalty in South Carolina but don’t seem to know how to buy or sell a house.

    Just to say ‘public choice explains it’ seem too pat an explanation for that particular trend.

  16. “Tim adds: You’ve slightly missed my point. I reject, through prejudice, the Keynesian idea because it means Ed gets more of our money. I’m not particularly criticising Ed: rather, Keynesianism.”

    Sorry, but you are missing my point. Forget Ed. My point @ 7 above is that you cannot refute Keynesianism with public choice theory.
    Because PCT says only that some of the behaviour of Keynesian public servants will be economically self-interested: it does not say that all their behaviour will be so, and it cannot specify which bits of their behaviour will be self-interested…

    DTP @ 8: “Genius is, very often, the ability to point out that which should be obvious (but isn’t).

    “Tim adds: Quite so Dennis, quite so. There’s an amazing number of things that are obvious immediately after someone points them out.”

    Dearie has already answered this, but it bears repeating that the only people who imagined that the state and its agents were not in part economically self-interested were…economists. The idea goes back at least as far as Machiavelli and beyond that to Aristotle, and is deeply embedded in commonsense.

    What Buchanan did apparently was flesh out a commonsense notion with games theory. A useful and interesting thing to do; but, forgive me, not a work of genius, because it fundamentally lacks originality.

  17. “why a great and strong leader hasn’t arisen of late – someone everyone could follow with acclaim…”
    We get one of those about every couple of months, don’t we? Have we had 2013’s first yet?

  18. @Diogenes: no, my father didn’t talk about Enclosure, but since the reasons are well attested, why would he? They were nothing to do with The Tragedy, since almost all commons were stinted. As for overfishing, yes we discussed that, even as I took part in it myself. Fishing wasn’t stinted. Easy, eh?

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