The Economics of Ethics and the Ethics of Economics

The Economics of Ethics and the Ethics of Economics

Values, Markets and the State

Edited by Geoffrey Brennan and Giuseppe Eusepi

This book makes a rational and eloquent case for the closer integration of ethics and economics. It expands upon themes concerned with esteem, self-esteem, emotional bonding between agents, expressive concerns, and moral requirements.

Chapter 6: Assessing Collective Decision-making Processes: The Relevance of Motivation

Philip Jones

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


Philip Jones Introduction Collective decision-making processes attract criticism when the policies that communities adopt differ from policies prescribed to maximize citizens’ welfare (Cullis and Jones, 1998). Differences are often attributed to biases introduced by voting rules and to distortions introduced by self-serving actors (for example politicians and bureaucrats). But what if differences arise because voters prefer policies that differ from those prescribed? Public finance textbooks are critical of in-kind provision of services (for example education, medical care) but in Western economies budgets are dominated by the requirement to finance in-kind provision (Brennan and Pincus, 1983). Textbooks prescribe policies that provide the cash equivalent of services delivered in kind (because citizens can allocate cash to maximize welfare). Textbooks demonstrate that it is possible to achieve the same increase in welfare with lower levels of government spending. But what if voters express a preference for services provided in kind? In the UK, Le Grand (2003, p. 161) cites evidence that citizens are ‘most proud of … the NHS’ and ‘persist in their pride despite their perception of the service’s ongoing difficulties’. If voters prefer these policies, have collective decision-making processes failed citizens by deferring to their preferences? The first objective in this chapter is to consider the impact of the motivation that brings voters to the ballot box. How are preferences expressed at the ballot box? How will policies be designed to win voters’ approval? The second objective is to consider how collective decision-making processes should be assessed. Can they fail even when...

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