108 Political analysis and public choice

Prerequisite
If taken as part of a BSc Degree, 02 Introduction to economics or 80 Introduction
to politics or 114 Democratic politics and the State.
Exclusion
This unit may not be taken with 87 Public choice and public management.

Aims and objectives
? To have a working knowledge of public choice theory - its assumptions,
‘tools’ and limitations.
? To understand some of the core arguments of public choice and their
application to political institutions and processes.
? To be able to apply these arguments and principles to new political situations,
institutions and complex political processes in liberal democracies.
Learning outcomes
At the end of the unit and relevant readings students should be able to:
? Know how to apply rational choice models to political institutions and
processes in order to better understand their mechanisms.
? See how essentially the same processes may work in entirely different
institutional settings.
? Understand how to apply the rational actor model to any situations involving
human action.
? Have an overview of the important institutions in modern liberal democracies.
Outline of topics
Part A - Toolkit and Fundamentals
1. Models and Modelling
Introduces some of the basic ideas of the toolkit of public choice and how
models are used to help understand political processes and institutions.
2. Individual Rationality
Defines rationality in rational choice models.
3. A Simple Model - Black’s Median Voter Theorem
Explains the median voter theorem which will be used several times in this unit.
4. Collective Rationality
Demonstrates the Condorcet cycle, and describes the results of Arrow's
theorem, showing that individually rational actors may not describe a
collectively rational entity.

EMFSS unit information - 108 Political analysis and public choice
5. Collective Choice
Illustrates some of the problems of collective choice from the results of topic 4.
6. Collective Action
Explains the collective action problem and some strategies for overcoming it.
7. Simple Game Theory I
Explains some simple game theoretic principles, describes some toy games, and
how they illustrate different collective action problems.
8. Simple Game Theory II
Continues explaining some simple game theory.
Part B - Parties and Legislatures
9. Two-Party Competition - Deterministic Model
Explains the Hotelling/Downs model of two-party competition and compares to
the median voter theorem. It shows why two parties may converge on the
median voter.
10. Two-Party Competition - Probabilistic Model
Explains why parties may not converge if voters and parties do not have
complete information about their preferences.
11. Multi-party Competition
Examines what might happen under multi-party competition in Downsian
models.
12. Forming Coalition Governments I
Explain the principles underlying coalition theory. Explains minimum winning
coalitions, minimum connected winning in a single ideological dimension.
Explains the cycling problems that emerge when there is more than one
dimension.
13. Strong Legislatures
Introduces structure-induced equilibrium and the role of committees in strong
legislatures. Introduces first, second and third generation models and the role of
the party.
14. Forming Coalition Governments II
Explains how strong parties can reduce the cycling problem. Explains how
structure-induced equilibrium can be used to explain coalitions in the portfolio
allocation model.
Part C - Government and the State
15. Controlling the Bureaucracy – Shirking and Shifting
Introduces the principal-agent model. Explains shirking and how government
and legislatures may try to control it. Explains policy drift. Shows how
bureaucrats with policy preferences may shift policy implementation away from
that desired by elected politicians.
16. Controlling the Bureaucracy – Shaping
Discusses organizational change within bureaucracies and the processes by
which line-bureaucracy has been replaced by agencies.
17. Pressure Politics – Rent Seeking
Examines the pressure group system and how agencies may become captured
by clients.
18. Pressure Politics – Information
Examines more recent models which suggest that pressures provide information
for bureaucrats.
19. Growth of the State?
Examines claims that the state has grown. Looks at the 'leviathan' model
20. Decentralization
Examines how decentralization may control the growth of the state, and the
welfare problems decentralization might bring.
Essential reading
Mueller, D.C. Public Choice III. (Cambridge University Press, 2003) [ISBN 978-
0521894753].

Assessment
This unit is assessed by a three hour unseen written examination.

All information in this document is subject to confirmation in the Programme Regulations for
degrees and diplomas in Economics, Management, Finance and the Social Sciences that are
reviewed annually. Notice is also given in the Regulations of any units which are being phased
out and students are advised to check unit availability.