Private Governance and the Pricing of Political Enterprises

Journal of Business Valuation and Economic Loss Analysis, Forthcoming

25 Pages Posted: 10 Aug 2016 Last revised: 26 Nov 2016

See all articles by Glenn Furton

Glenn Furton

Department of Agricultural and Applied Economics; Texas Tech University

Alexander William Salter

Texas Tech University - Rawls College of Business; American Institute for Economic Research

Date Written: November 25, 2016

Abstract

Austrian economists are perhaps most well-known for developing the theory of the market process — how producers and consumers, guided by market prices, are able to coordinate their actions over time. In this paper we extend Austrian insights to the provision of fundamental governance goods. It is typically thought that such goods, because of their publicness, cannot be provided by market mechanisms. We argue orthodox public finance and political economy is mistaken in this regard. The market process applied to governance goods, which we call political pricing, is capable of creating governance environments conducive to a high degree of social cooperation under the division of labor. We highlight some problems with orthodox public finance and political economy approaches, theoretically develop a market process approach to governance, and discuss two examples of such mechanisms in creating wealth.

Keywords: Austrian economics, Dubai, market process, political pricing, private governance, Singapore

JEL Classification: B53, D23, H11, P16

Suggested Citation

Furton, Glenn and Salter, Alexander William, Private Governance and the Pricing of Political Enterprises (November 25, 2016). Journal of Business Valuation and Economic Loss Analysis, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2820045 or http://dx.doi.org/10.2139/ssrn.2820045

Glenn Furton

Department of Agricultural and Applied Economics ( email )

Box 42132
Lubbock, TX 79409-2132
United States

Texas Tech University ( email )

2500 Broadway
Lubbock, TX 79409
United States

Alexander William Salter (Contact Author)

Texas Tech University - Rawls College of Business ( email )

Lubbock, TX 79409
United States

HOME PAGE: http://awsalter.com

American Institute for Economic Research

PO Box 1000
Great Barrington, MA 01230
United States

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