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In this article the author discusses how an analysis of economist Thomas Hobbes' views on anarchy and the control of money can make sense of the precepts of economist Adam Smith that the United States has followed since its founding. Smith theorized that stability of property rights, contracts, and money will allow people to interact with one another to generate, produce, and distribute value. The article notes that America also placed control of money with the government and this is considered politicization. The article notes the market will fail with monetary anarchy and that politicization is also ineffective.

In analyzing political processes, public choice scholars invoke a two-level choice, choices within rules and constitutional choices among sets of rules. This paper considers rules that set the limits for market choice through the political-collective action. Three familiar categories of institutional constraints are examined: prohibition, regulation, and taxation-public spending, that are significant in limiting the trading process. The motivation for institutional-constitutional construction may originate from sources other than economic objectives. We note that institutional parameters include political and legal constraints, as supplemented by traditions and conventions which may affect choice behavior. We relate the analysis to Adam Smith's vision of the achievement of natural liberty and economic progress through his theorem that economic productivity depends on market size. [ABSTRACT FROM AUTHOR]

The article expounds on the economic views of the late economist Peter Bauer. Bauer was known for his courage in relying on simple verities like the poor's ability for self-sustenance and growth without the interference of the government. Relative success of some societies attributed to institutional frameworks, in Bauer's observation, was a historical incident.

Do majoritarian democracies overexploit the general tax base, akin to the tragedy of the commons? Or, apart from any consideration of efficiency norms, are there “natural” forces in majoritarian politics that keep tax rates below revenue-maximizing limits? This paper formulates the fiscal process through the metaphor of the commons and analyzes the equilibrium that emerges in settings where differing majority coalitions may operate simultaneously to place charges on the general taxable capacity of the economy. The presence of a “membership externality,” emergent from the necessary intersections of members among separate majority coalitions, acts to limit fiscal exploitation, even in the pure transfer settings. [Copyright &y& Elsevier]

Examines the constitutional efficiency of the European Central Bank. Criteria for constitutional efficiency; Criticisms against the European Monetary Union; Examination of the political and economic future of the euro.

Delves into the study of public choice. Insight of Swedish economist Knut Wicksell on the injustice and inefficiency that resulted from majority rule in parliamentary assemblies; Discussion of the constitutional economics; Objections to public choice; Impact of public choice.

The rational-choice logic of majority rule embodies discriminatory distribution of burdens and benefits as between members of majority and minority coalitions. Empirical observation, however, suggests universality or near-universality, even in programs that are potentially discriminatory. Attempts have been made to explain the anomaly, but the basic issues have not been resolved. Weingast and others have argued that working legislatures will implicitly adopt quasi-unanimity rules or conventions. We present an alternative model of distributive majoritarian politics. The distinctive feature is "common access." If democratic politics is modeled, not in terms of a monolithic decision structure, but instead as a setting where differing and separate decision authorities are granted access to the general taxable capacity, collective action can be analyzed in the logic of common resource usage. Our model allows for universality, even with pork-barrel spending, without resort to institutionalized rules or informal conventions. [ABSTRACT FROM AUTHOR]

This paper examines several elements of "the constitutional way of thinking" beginning with a discussion of the commonality problem in patterns of thinking. Later sections address the productivity of reductionist classification schemes and how this is usefully applied to politics. More specifically, the discussion focuses first on why economists, in particular, have difficulty with this approach; second on the general problem of adhering to idealist thinking in political theory; and third on speculation into the conditions necessary to acquire 'the constitutional way of thinking.' [ABSTRACT FROM AUTHOR]

For expository purposes, one may label the two logics of trade as Smithean and Ricardian, with reference to the two leading figures of classical political economy, Adam Smith and David Ricardo. Neoclassical economic analysis, which dominated the discipline of economics from 1870 to 1970, was informed during that century by the Ricardian logic before returning partially and somewhat reluctantly to the Smithean logic in the 1980s and later. As the scientific arguments spill over into public and political attitudes, however, the Ricardian logic continues to hold its place, with obvious implications for the public perception of the effects of policy alternatives. The Smithean logic is straightforward. Why do persons trade with one another? They do so because specialization is productive; people can produce more economic value if each person does one thing instead of trying to do everything. The Ricardian logic that explains the origins of trade differs categorically from the Smithean argument just outlined. As noted, Smith's account of the benefits of specialization explains why exchange will be mutually beneficial even if the trading parties are initially identical in all respects. By contrast, the Ricardian logic locates the origins of exchange in the differences among persons–differences in their capacities to produce separate final goods. If such differences exist, specialization and exchange will always prove mutually beneficial. Trade emerges because different persons (or trading units, including countries) have different comparative advantages in producing different goods. [ABSTRACT FROM AUTHOR]

Focuses on the significant contributions of Nobel laureates to economics in the 20th century. Conceptualization of market coordination; Importance of theory of games; Development of macroeconomics; Commencement of voting rules for public choice; Impact of rational expectations on macroeconomics.

Presents information on a study that analyzed usage of a common property resources, the commons, under collectivization as compared with more familiar privatization institutional arrangements. Analysis of institutional arrangements in which usage of the shared facility is not open to all who might desire access; Algebraic model used to formulate usage decision; Conclusions.

Investigates the impact of direct democracy in Switzerland. Promotion of economic and political prosperity; Decrease of public sector size in classical liberal; Evolution of existing political and legal practices.

Focuses on the contribution of game theory to economics. Application of the game theory to various disciplines; Emergence of economists specializing as game theorists; Generalized failure of economists to understand what their whole discipline is about; Potentials of game theory when extended to analyze positive sum interactions; Establishment of a formal mathematics of human interaction.

Focuses on the existence of classical liberalism in the United States. Differences between the soul of classical liberalism and socialism; Elements of an individual's desire for liberty; Organizational and intellectual bankruptcy of socialism.

Individuals retain control over at least some minimal dimensions of personal behavior. If this is acknowledged, social states are not, and cannot be, objects of choice. Social states emerge from the interdependent choices made by acting individuals and groups. Individuals may ordinally rank social states, but the objects for collective choice must be assignments of rights or rules. Failure to appreciate the distinction here leads to misguided efforts to attain positions that may be imagined but that are beyond the limits of behavioral feasibility. [ABSTRACT FROM AUTHOR]

Examines the moral dimension of debt financing in political institutions in the U.S. Moral elements in the accelerating government budget deficits; Origin of moral rules in politics; Moral dimensions of debt financing in governments; Definition of moral community and moral order.

Discusses whether the scientific content of economics depend on cultural parameters. Economics as a human behavioral science; Cultural evolution and the universalities of economic science; Limits of market and politics; Economics and moral philosophy.

Individuals with legally protected endowments have incentives to allow maximal liberties of purchase or sale to persons on the opposing sides of potential trades. Unless overtly restricted, potential buyers and sellers will be allowed freedom of entry into all markets, thereby ensuring maximization of combined consumers' and producers' surplus or rent. Since liberty, as defined, is a valued but not a scarce good, it is optimally utilized when it is not valued at the margin. The relationship between liberty and rent is examined, and individuals have incentives to extend liberties to others as means of protecting their own rents. [ABSTRACT FROM AUTHOR]

Focuses on the accuracy of the information presented in autobiographies. Difference in the standards of honesty among autobiographers; Methods of defining the life of a person; Discussion on the potential usefulness of biographical and autobiographical information.

Convexity constraints create problems in the theory of public goods that need not arise in the theory of private goods. This paper discusses these problems, which have not been fully recognized in the standard literature. The dimensionality of public goods becomes critical. A distinction must be made between consumption units, that enter as arguments in utility functions, and production units, which enter production functions, and which are directly purchased by the demanders. Standard convexity properties defined on consumption units need not imply convexity properties on production units, given standard properties of utility and production functions. The ambiguities are clarified by reference to the orthodox literature in public goods theory. [ABSTRACT FROM AUTHOR]

Much of the criticism of JOHN RAWLS', A Theory of Justice (1971), and especially that by economists, has concentrated on his difference or maximin principle of distribution, one of the two central principles of justice specifically suggested. This criticism is directed at the extreme risk-averseness that seems to be embodied in the maximin criterion. The maximization of expected utility is posed as a more plausible alternative. This paper offers an interpretation of RAWLs' argument that need not incorporate risk-averseness. The discussion involves a careful definition of the 'original position', which is not fully described by RAWLS. If the 'original position' is specifically defined to be the equilibrium that is attained in genuine Hobbesian anarchy (the war of each against all), the difference principle of distribution may emerge from the contractual negotiations of the parties as the only viable distributional rule. If, in this original, and highly undesirable, position, persons predict that any person, or small group, can reduce the whole society to anarchy by disruption, this difference principle may dominate the alternative that maximizes expected utility for the simple reason that the latter will be unsustainable. This interpretation indirectly explains RAWLS' relative neglect of enforcement of contractual provisions. [ABSTRACT FROM AUTHOR]

The article focuses on the potential for taxpayer revolt in U.S. democracy. The success of Proposition 13 can indeed be explained by institutional elements in the particular choice presented to California voters. Comparable results may not emerge for more general tax-limit and spending-limit propositions. An elementary proposition in public choice theory states that the same basic principle applies to the behavior of individuals as they participate in democratically organized governmental processes. The allegedly excessive influence of producer interests in modern regulatory bureaucracy is often explained by the relative concentration of regulatory benefits compared to the diffusion of regulatory costs among consumers. The directional bias introduced into the decision process is determined by the institutional setting for fiscal choice. Taxes in principle are supposed to be general in their application and historically, constitutional law has reflected the norm. Once the issue was posed as one of identified and measurable tax reductions versus cuts in generalized public spending, the outcome may well have been predictable. No reductions may be promised and the feature may seem to be politically attractive, since it allows the dislocations and distortions incident upon budget cuts to be avoided.

Summarizes the theory of competitive federalism and examines the relation between the engagement-participation of the individual in politics and the size of the political unit. Opposition to efforts to move toward federalist structures; Relationship between federalist political structure and the sovereignty of the individual; Theory of competitive federalism; What the efficacy of competitive federalism depends on.

Discusses the whole set of constitutional issues that involves organizational and procedural alternatives of governance. Constitutional order of classical liberalism; Constitutional order of socialism; Post-socialist constitutional contradiction.

Points out that an economy organized on market principles minimizes the importance of the political bureaucracy. Relationship between politicization and market organization; Distinction between political pricing and market pricing; Notion of a politically influenced market price.

Discusses the lessons of the American experience for Europe's chance to constitute a genuine federal union. Important aspects of James Madison's grand design for American federalism in 1787; Public philosophy for effective federal union; Rules for a competitive constitutional game; European federalism; German unity; Opening of eastern Europe; Prospects for an effective European federal union.

Discusses the US Federal Judicial Center's efforts to develop and deliver training programs for probation and pretrial services staff using on-line conferencing. Benefits and limitation of on-line conferencing; Tips on how best to employ the medium either for training, discussion or group work; Comparison between asynchronous and synchronous applications.

Presents a roundtable discussion on the influence of Armen Alchian as economics teacher, researcher, coauthor and colleague. Speakers as Alchian's students at the University of California, Los Angeles; Alchian's 80th birthday in 1996.

Recent discussions of antitrust based on the private interest theory of government conclude that the real, as opposed to the stated, purpose of antitrust legislation is to protect politically influential industries against competition. Yet several prominent antitrust scholars who accept the private interest theory of government in general see antitrust legislation serving the public interest by increasing competition. We argue that the private interest theory of government is consistent with the view that antitrust legislation promotes competition. Indeed antitrust legislation may be supported by organized interest groups because such legislation increases the competition they face. [ABSTRACT FROM AUTHOR]