The Online Library of Liberty

A project of Liberty Fund, Inc.

• Foreword
• Preface
• The Reason of Rules
• 1.: The Constitutional Imperative
• I.: Introduction
• II.: Reasons For Rules
• III.: Rules of Games
• IV.: Rules of the Road
• V.: Rules of the Market Order
• VI.: Rules of Political Order
• VII.: The Importance of Rules
• 2.: The Contractarian Vision
• I.: Introduction
• II.: Noncontractarian Constitutionalism
• III.: Individuals As Sources of Value
• IV.: Contract and Exchange
• V.: Politics In the Exchange Perspective
• VI.: Unanimity As the Contractual Ideal
• VII.: Agreement On Rules and the Veils of Ignorance and Uncertainty
• VIII.: Conclusions
• 3.: The Myth of Benevolence *
• I.: Introduction
• II.: Private Good and Public Good
• III.: Science, Truth, and Politics
• IV.: The Authoritarian Imperative
• V.: Majoritarian Democracy In the Noncontractarian Paradigm
• VI.: The Aim of Politics
• 4.: Modeling the Individual For Constitutional Analysis
• I.: Introduction
• II.: Homo Economicus In Politics: the Argument For Symmetry
• III.: Science and the Empiricist Defense
• IV.: A Methodological Defense of the Differential Interest Model of Behavior
• V.: Social Evaluation and Quasi-risk Aversion
• VI.: Gresham’s Law In Politics
• VII.: Summary
• 5.: Time, Temptation, and the Constrained Future *
• Preface
• Part 1.: Individual Private Choice
• I.: Introduction
• II.: The Ultimate Z ’s
• III.: Preferences For Preferences
• IV.: Past, Present, and Future
• Part 2.: Individual Public Choice
• I.: Introduction
• II.: Society With a History
• III.: Temporal Interdependence
• IV.: An Illustration
• V.: Moral Rules And/or Constitutional Commitment
• 6.: Politics Without Rules, I: Time and Nonconstrained Collective Action
• I.: Introduction
• II.: The Social Discount Rate
• III.: The High-tax Trap
• IV.: The Inflation Trap
• V.: The Public-debt Trap
• VI.: Other Examples
• VII.: Conclusions
• 7.: Rules and Justice
• I.: Introduction
• II.: Just Conduct and the Notion of Desert
• III.: Justice and Promise Keeping
• IV.: Justice Among Rules
• V.: Just Rules, Agreed-on Rules, and Just Conduct
• VI.: Conclusions
• 8.: Politics Without Rules, II: Distributive Justice and Distributive Politics
• I.: Introduction
• II.: Distributive Justice: the Conventional View
• III.: The Constitutional Perspective and Institutional Incidence
• IV.: The Incidence of Unrestricted Majoritarianism
• V.: Tax Rules and Distribution Under Majority Rule
• VI.: Direct Constitutionalism and Distributive Justice
• VII.: Summary
• 9.: Is Constitutional Revolution Possible In Democracy?
• I.: Introduction
• II.: Pareto-superior Change and Wicksellian Unanimity
• III.: Distributional Limits and Prospective Rules
• IV.: Status Quo Entitlements and Distributional Envy
• V.: Constitutional Change and Free Riders
• VI.: The Role of Norms
• VII.: Toward a Civic Religion

I.

Introduction

We have discussed the private-choice calculus of the individual in some detail because the analysis is helpful in introducing the more complex calculus of the individual confronting the public- or social-choice setting. In order to reduce the discussion to manageable proportions, we shall ignore several of the complexities that arise. We shall continue to neglect strategic behavior. The individual in a public-choice setting is one among many and can rationally treat the behavior of all others as if it were part of the environment and hence not subject to manipulation. We also continue to concentrate on the choice calculus of a single reference individual. We neglect problems involved in securing agreement among persons, although, as the argument will suggest, the operation of the rules for making arrangements may modify the individual’s choice behavior. We presume that the individual will behave in the many-person collective-choice setting as if he pursues his own interests as they are reflected in the underlying utility function.

One reason for the detailed elaboration of private-choice behavior in Part 1 was to suggest that in several respects, the private- and public-choice settings are similar. We can summarize the earlier analysis as follows: A person faces a choice at t₀, a choice that will be constrained by choices made in prior periods; this choice will be informed by the influence that behavior in t₀ is anticipated to exert on choices made in t₁ and beyond. The person in t₁ and beyond is, in part, constructed by choices made in t₀ and earlier, but at the same time the person in t₁ and beyond must be different from the one who must act in t₀. In this setting, the individual chooses among the Z’s in t₀; the individual may adopt moral rules; the individual may precommit future choices—all of these actions are designed to further the achievement of a preferred life plan.