Public Choice

, Volume 114, Issue 3–4, pp 253–273 | Cite as

On the Public Choice Critique of Welfare Economics

  • Timothy Besley
  • Stephen Coate

Abstract

The public choice literature urges the welfare economist toanticipate how political forces will shape the levels of newpolicy instruments when government intervenes in a new way.This paper argues that the welfare economist should alsorecognize that new interventions may impact the politicallydetermined levels of existing policy instruments. It shows howthe introduction of a new instrument can lead to shifts inpolitical coalitions or compromises in existing areas ofconflict that can produce significant changes in existingpolicies. Such spillover effects can provide new arguments forintroducing particular policy interventions. Even a policyinstrument without an obvious welfare economic rationale canchange voter coalitions and shift the policy equilibrium in awelfare improving direction.

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Copyright information

© Kluwer Academic Publishers 2003

Authors and Affiliations

  • Timothy Besley
    • 1
  • Stephen Coate
    • 2
  1. 1.Department of Economics, London School of EconomicsLondonU.K
  2. 2.Department of EconomicsCornell UniversityU.S.A

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