The Review of Austrian Economics

, Volume 22, Issue 2, pp 145–150 | Cite as

Elections as takeover bids: Some agonistics concerning good government

  • Richard E. Wagner


Agency theory has been widely applied to the governance of business corporations and to good advantage. The formal framework of agency theory pertains as well to polities, wherein citizens are the principals and politicians the agents. Where takeover efforts occur irregularly for corporations, they occur at regular intervals through elections for polities. Timothy Besley’s Principled Agents uses the agency theory to argue that electoral competition will generally select competent and public-spirited politicians. This claim follows from his formal framework, but that framework ignores some questionable and unsettled matters that challenge Besley’s relatively roseate view of the qualitative character of electoral selection.


Agency theory Corporate control Takeover bids Elections Good government Economic calculation 

JEL Codes

D6 D7 H1 


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Copyright information

© Springer Science+Business Media, LLC 2009

Authors and Affiliations

  1. 1.Department of Economics, 3G4George Mason UniversityFairfaxUSA

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