Constitutional Political Economy

, Volume 23, Issue 3, pp 261–277 | Cite as

Rationality, political economy, and fiscal responsibility: wrestling with tragedy on the fiscal commons

Original Paper

Abstract

The continuing budget deficits and accumulating public debt that commonly plagues western democracies reflects a clash between two rationalities regarding human governance: one of private property and its conventions and one of common property and its procedural framework. Democratic budgeting creates a form of fiscal commons whose governance is subject to the tragic outcomes depicted by Garret Hardin (in Science 162:1243–1248, 1968). To be sure, tragedy can be avoided as Elinor Ostrom (1990) explains, but only to the extent that the fiscal commons is governed in a manner consonant with Antonio De Viti de Marco’s (1936) model of the cooperative state. While the tragedy of the commons that results from this tectonic clash is an inherent feature of democratic political economy, that tragedy can nonetheless be limited through reasserting the conventions and institutions of a constitution of liberty.

Keywords

Fiscal commons Institutional public finance Antonio De Viti de Marco Cooperative vs. monopolistic states Polycentric vs. monocentric polities State as intermediary Scalefree modeling 

JEL Classification

B4 D7 E6 H6 

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Copyright information

© Springer Science + Business Media, LLC 2012

Authors and Affiliations

  1. 1.Department of Economics3G4 George Mason UniversityFairfaxUSA

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