Rules versus Authorities: Buchanan and Simons and Fiscal Policy

“Rules versus Authorities: Buchanan and Simons and Fiscal Policy” for James M. Buchanan: A Theorist of Political Economy and Social Philosophy, ed. Richard Wagner. Palgrave Macmillan, 2018: Forthcoming

23 Pages Posted: 12 Jan 2018 Last revised: 22 Jul 2018

See all articles by Marianne Johnson

Marianne Johnson

University of Wisconsin - Oshkosh - Department of Economics

Date Written: January 9, 2018

Abstract

This chapter examines the origins of James M. Buchanan’s critique of Keynesian fiscal policy. Considered are Buchanan’s graduate training in public finance and fiscal policy and his early work in fiscal federalism. Two important themes emerge. The first is the influence of Henry C. Simons. The second relates to the necessity of choice between “rules versus authorities” or democratic process versus authoritarianism in policy making. Beginning with his 1948 dissertation, Buchanan consistently emphasized the importance of incorporating democratic processes directly into economic models rather than relying on omniscient and benevolent social planners or other authorities. It is the lurking authoritativeness in fiscal policy that Buchanan particularly objected to, more than the theoretical mechanics.

Keywords: James M. Buchanan, Fiscal Policy, Fiscal Federalism, Public Debt, Henry C. Simons, Chicago School, John Maynard Keynes

JEL Classification: B22, B31, E12, H3, H6

Suggested Citation

Johnson, Marianne, Rules versus Authorities: Buchanan and Simons and Fiscal Policy (January 9, 2018). “Rules versus Authorities: Buchanan and Simons and Fiscal Policy” for James M. Buchanan: A Theorist of Political Economy and Social Philosophy, ed. Richard Wagner. Palgrave Macmillan, 2018: Forthcoming, Available at SSRN: https://ssrn.com/abstract=3098670 or http://dx.doi.org/10.2139/ssrn.3098670

Marianne Johnson (Contact Author)

University of Wisconsin - Oshkosh - Department of Economics ( email )

800 Algoma Blvd.
Oshkosh, WI 54901
United States
920-424-2230 (Phone)
920-424-1734 (Fax)

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