November, 2010

Polycentrism and Gargantua

  • Peter J. Boettke

    Director, F. A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics
  • Christopher Coyne

    Associate Director, F. A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics
  • Peter Leeson

    Senior Fellow, F. A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics
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Read the full article at SSRN.com.

How should governments publicly provide goods and services? One option is to do so polycentrically – through multiple, autonomous, local decision-making centers. Alternatively governments may organize public good provision monocentrically – through a singular, centralized, higher-level decision-making center. We call the former arrangement “polycentrism” and the latter one “gargantua.” This paper investigates the costs and benefits of polycentrism and gargantua. We argue that polycentrism is superior. Polycentric provision permits localities to discover and deploy the efficient scale of public good provision, small or large. Gargantua precludes small-scale provision as an option even when it’s efficient. To investigate our argument we consider governments’ consolidation of public education in the United States.