Samuel Fortrey, Public Profit, and Public Good

Found in A Select Collection of Early English Tracts on Commerce (1856)

In his 1663 England’s Interest and Improvement - Consisting in the Increase of the Store, and Trade of this Kingdom, addressed to Charles the II, the author of this early tract on commerce, the esquire Samuel Fortrey advances the ideas of concentrated and diffuse interests.

But private advantages are often impediments of publick profit; for in what any single person shall be a loser, there, endeavours will be made to hinder the publick gain, from whence proceeds the ill succes that commonly attends the endeavours for publick good; for commonly it is but coldly prosecuted, because the benefit may possibly be something remote from them that promote it; but the mischief known and certain to them that oppose it: and Interest more than reason commonly sways most mens affections. (FROM: To the Reader)

Those ideas were explicitly analyzed and described only recently by economists of the Public Choice school, starting with Mancur Olson’s The Logic of Collective Action. Often in cases of collective action, some decisions concentrate benefits for a small group of economic agents while the costs of those decisions are dispersed among a large group of economic agents. With that, the concentrated group of beneficiaries are highly motivated and easily organized to support that decision, while the large group burdened by the costs are neither motivated nor easily organized to oppose it. Once these ideas were made explicit, it allowed economists to point out more easily why some “failures” both of “markets” and of government intervention happen under some defined institutional settings. An emblematic case is the permanence of subsidies for the sugar industry in the United States.