Public Choice Theory Concept
Public Choice Theory is the branch of economic and politic sciences which studies the way how governmental institutions take their decisions. One of the pioneers of the Public Choice Theory was Joseph Schumpeter which evaluated the governments’ role in the society in Capitalism, Socialism and Democracy (1942). Followed several works, among which the studies, mostly mathematically, of Kenneth Arrow and the book of Anthony Downs, “A Theory of Democracy” (1957) in which the author defends that politicians chose the economic policies as a way to be reelected.
In general terms, the Public Choice Theory analyses how can work the different mechanisms of vote, showing that doesn’t exist an ideal mechanism to obtain social choices from the individual preferences. On the other hand, Public Choice Theory also analyses the called government failures associated to the lack of the economic efficiency of the economic decisions and the unfairness in the income distribution. Some of the terms addressed by the Public Choice Theory are the short temporal horizon of the elected governors, the need of existence of a budget restriction for the different groups of expenses, or yet the effect as to economic efficiency of some funding ways of the parties and the elections.
