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James Buchanan discarded romantic notions of public spirited politicians
James M. Buchanan, who died on January 9 at 93, was one of the most profound thinkers of our age. Few Indians would be familiar with his academic contributions or even recognise his name. Yet, the insights from his research would strike a chord with every Indian navigating government inefficiencies and excesses on a daily basis.
Buchanan, professor emeritus at George Mason University in Fairfax, Virginia, won the Nobel Prize in Economic Sciences in 1986 for his contributions to the economic analysis of political decision-making. By bringing politics back into economics, Buchanan made economics more humane, realistic, interesting and relevant. He challenged the economics orthodoxy, dared to be different, inspired his students and colleagues, and developed one of the most unique and creative research programmes in economics at the Centre for Study of Public Choice at George Mason University.
"Politics without Romance", the title of his 1997 article, summarises one avenue of research in a career spanning over six decades. Buchanan, with his colleague Gordon Tullock, developed the field of public choice, applying economic reasoning to political processes. Buchanan assumed that politicians and bureaucrats act in their own interest and respond to incentives. While this is recognised in our daily lives, economists and policymakers focusing on market failure overlook it and advocate government intervention, assuming that political actors will take the optimal action.
Corruption scandals like the 2G and Adarsh Society scam, election manifestos promising freebies, from rice to laptops, and the dismal state of public goods and services in India can be comprehended by applying Buchanan's insights. By eliminating romantic assumptions about the public spirit of political actors, he shed light on how governments operate and explained why the political process of allocation often intensifies problems instead of solving them.