Municipal Corporations, Economic Calculation, and Political Pricing: Exploring a Theoretical Antimony

36 Pages Posted: 2 Feb 2011

See all articles by Richard E. Wagner

Richard E. Wagner

George Mason University - Department of Economics

Date Written: February 1, 2011

Abstract

This paper explores a possible path toward dissolving an antinomy within political economy: market order is treated as emergent and spontaneous while political order is treated as planned. This paper pursues a path that seeks to locate the entire social order as emergent and spontaneous. Where a market is a congeries of business corporations, a polity is a congeries of municipal corporations. Like business corporations, municipal corporations operate within a setting wherein those who manage those corporations are largely separate from those who supply the capital with which those corporations operate. A system of municipal corporations, however, cannot generate the market prices necessary for economic calculation because ownership is inalienable. What arises is a system of political prices that arise parasitically within a system of market prices. This paper explores some features pertinent to the articulation of a theory of political economy grounded in spontaneous ordering throughout the ecology of enterprises that constitutes a society.

Keywords: municipal corporations, agency theory, competition among governments, political pricing, emergence, scale-free models

JEL Classification: D23, D72, D78, H70

Suggested Citation

Wagner, Richard E., Municipal Corporations, Economic Calculation, and Political Pricing: Exploring a Theoretical Antimony (February 1, 2011). GMU Working Paper in Economics No. 11-04. Available at SSRN: https://ssrn.com/abstract=1753321 or http://dx.doi.org/10.2139/ssrn.1753321

Richard E. Wagner (Contact Author)

George Mason University - Department of Economics ( email )

4400 University Drive
334 Enterprise Hall
Fairfax, VA 22030
United States
(703) 993-1132 (Phone)

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