Why Market Failures Are Not a Problem

James Buchanan on Market Imperfections, Voluntary Cooperation, and Externalities

Datos Bibliográficos

ID4298804
AutoresAlain Marciano (0000-0002-7283-5520, autor de correspondencia)
Año2013
Volumen45
Número2
Páginas223-254
Fecha de publicación2013-06-01
Peer ReviewedSí
Open AccessNo
TipoARTICLE
RevistaHistory of Political Economy (JOURNAL)
Identificadores de la revistaISSN: 0018-2702 • E-ISSN: 1527-1919
EditorialDuke University Press (PUBLISHER • US)
DOI10.1215/00182702-2082694
OpenAlexW2170429324
IdiomaEN
Citas recibidas16
Referencias citadas41

This article describes the intellectual trajectory James Buchanan followed from the early 1950s, when he started to work on ``spillover effects,'' to the mid-1960s, when he had completed a consistent explanation of the efficiency of market mechanisms and private arrangements in the presence of externalities. We show that, in contrast with what most economists admit, Buchanan argued that, even if externalities are a cause of ``market failures,'' this cannot be used to legitimate the intervention of the state, because individuals tend to pay for the external effects their actions generate. By adopting a historical perspective, we are able to show the remarkable consistency of Buchanan's claims about externalities, even though he developed them in a period when the views of economists on the question were changing dramatically

Consistency (knowledge bases · Economics · Externality · Intervention (counseling · Market failure · Microeconomics · Neoclassical economics · Perspective (graphical · Positive economics · Spillover effect · State (computer science · Work (physics · Economic theories and models · Economic Theory and Institutions · Economic Theory and Policy · Psychology