James M. Buchanan's Constrained Vision in Cost and Choice

Abstract

James M. Buchanan’s 1969 book Cost and Choice speaks directly to the socialist calculation debate from the perspective of the “London Tradition” in the theory of cost. More than this, however, it places Buchanan alongside Adam Smith, Friedrich Hayek, and Milton Friedman as an exemplar of what Thomas Sowell called “the constrained vision” in his 1987 [2007] book A Conflict of Visions. This essay explores Buchanan’s radical subjectivism in Cost and Choice, why it aligns him with Sowell’s “constrained vision,” and what this implies about Buchanan’s place within political theory generally. His radically subjectivist analysis of cost underlies his constitutional liberalism, and it obviates a more activist, interventionist political agenda.

Keywords: Cost, subjectivism, Buchanan, social theory, classical liberalism, choice, London School of Economics, Austrian Economics

JEL Classification: A12, B25, B31, H11