Econocrats and the policy process : the politics and philosophy of cost-benefit analysis

Planning and Cost-Benefit A. Rational Decision-making B. The Airport Controversy C. Planning versus C.B.A. D. Postscript: 'Nonsense on stilts' and 'Roskillitis' 8 Economics, Government and Society A. Introduction B. The Budgetary Game and Resource Efticiency C. Economic Ideas and Government Operations D. Economics and Social Values NOTES and REFERENCES INDEX \* Strictly of course a technical factor is never a determinant of any decision and becomes authoritative only when linked with a purpose that is not itself questioned; for example, because we accept that bridges ought not to collapse we also accept engineering opinion on this point as fuHy authoritative. However, technology is always a constraint upon possible decisions -if the knowledge to construct aqueducts and dams had been lacking, Los Angeles could not have grown in any case. • This point has been amply documented in L. M. Fraser, Economic Thought and Language (London, 1947). • This is an exaggeration. Mishan concedes that the economist must utilise for his purposes one or two ethical principles which must be assumed to be self-evident. They are not so of course (see later). But the position is still 'econocratic' because plainly these basic ethical assumptions must also be accessible to politicians and other decision-making bodies. Yet apparently only the economist is in a position to utilise them to reach a right conclusion. ## The Dilemmas of Welfare Economics • The theory of eonsumers' sovereignty and marginal utilities is often wrongly aseribed to the elassical school of English economists (Adam Smith. David Rieardo, James Mill et al.). This is a natural error for laymen because of the identification of these writers with theories of eompetition and laissez-faire. and the association of some of them with Bentham and the Philosophie Radieals. In fact, the classie writers espoused for the most part a labour theory of value, whieh though now diseredited in • This calculation is obviously impractical for any individual -there are far too many uncertainties -and the purpose of the authors is to establish appropriate constitutional or social decision rules on these matters which will command the widest possible (preferably unanimous) consent. The argument is interesting here as using the size of bargaining costs as an index to the practicality of a market solution, and also as introducing a still more stretched usage of the word 'externality', See J. M. Buchanan and G. Tullock, The Calculus 01 Consent (Ann Arbor, Michigan, 1962) chapters 5-8, Front Matter....Pages i-xi Front Matter....Pages 1-1 ‘Econocracy’ and the Policy Process....Pages 3-13 The Dilemmas of Welfare Economics....Pages 14-34 The Puzzles of ‘Externalities’....Pages 35-66 The Quest for Quantification....Pages 67-93 Front Matter....Pages 95-95 Economics and Democracy....Pages 97-124 Techniques and Values....Pages 125-149 Planning and Cost-Benefit....Pages 150-177 Economics, Government and Society....Pages 178-203 Back Matter....Pages 204-212