Free Market Economics

Episode Synopsis

In lecture nine, Dr. Henderson explains the public choice school of economics, which applies economic analysis to political behavior and shows how self-interest influences politicians, bureaucrats, and voters. We discuss the median voter theorem, the problem of concentrated benefits and dispersed costs (e.g., sugar import quotas), and the ideas of rational ignorance and rational irrationality among voters. The lecture concludes by examining how public choice theory supports constitutional constraints like separation of powers and checks and balances, while noting that these limits are often imperfectly enforced in practice.