Anarchy, State and Public Choice

Anarchy, State and Public Choice

New Thinking in Political Economy series

Edited by Edward Stringham

The book reprints the main articles from the 1972 volume Explorations in the Theory of Anarchy, and contains a response to each chapter, as well as new comments by Gordon Tullock, James Buchanan, Jeffrey Rogers Hummel and Peter Boettke. The younger economists are notably less pessimistic about markets and more pessimistic about government than their predecessors. Much of the new analysis suggests that private property rights and contracts can exist without government, and that even though problems exist, government does not seem to offer a solution. Might anarchy be the best choice after all? This provocative volume explores this issue in-depth and provides some interesting answers.

Chapter 9: Public Choice and Leviathan

Benjamin Powell

Subjects: economics and finance, public choice theory, politics and public policy, public choice

Extract

Benjamin Powell In ‘Before Public Choice’ (1972), Buchanan began exploring interaction between individuals in anarchy. Buchanan further developed his ideas in The Limits of Liberty (1975). This chapter is a partial response to both of these works that focuses on whether his derivation of a ‘protective state’ from Hobbesian anarchy is justified. Buchanan’s analysis concluded that a government must be formed for people to escape a ‘nasty, brutish, and short’ life in the Hobbesian jungle. This chapter presents a public choice analysis of a government comprising the same Hobbesian individuals Buchanan modeled in anarchy. The first section reviews Buchanan’s framework and conclusions. The second section uses his assumptions about individual behavior in anarchy to analyze his proposed third-party enforcer – government. Once this public choice approach is taken I examine whether people would ‘conceptually’ agree to form a state for third-party enforcement. THE BUCHANAN MODEL Buchanan’s analytical starting point is Hobbes’s Leviathan.1 Like Hobbes, Buchanan believes that conflicting claims over resources in anarchy will lead people to invest heavily in attacking others and defending against attacks. Society will plunge into a war of all against all, where the resulting lives will be nasty, brutish and short. Buchanan argues that individuals will achieve higher levels of utility if they leave anarchy and create an enforcement mechanism that forces them to respect each other’s property.2 He concludes that although anarchy, which allows for maximum personal liberty, is ideal, a government is necessary for people to achieve a higher level of utility. Unlike Hobbes,...

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