Public Choice

Public Choice, broadly defined, is the economic analysis of nonmarket decision-making. My primary focus in this chapter will be on the central importance of the “Virginia School” of Public Choice, specifically in two aspects. First, Public Choice was central to countering the presumption of market failure among economists, beginning in the 1950s and 1960s. Second, yet less emphasized, is the role in which Public Choice played in analyzing the economics of anarchy, beginning in the 1970s. Although seemingly disconnected, both aspects of the Virginia School are linked by the fundamental question of political economy: Under what institutional conditions can social order emerge unintendedly from the self-interest of individuals? Therefore, in both respects, the Virginia School has been central to the rearticulation of 19th political economy during the twentieth and twenty-first centuries.