1. The Logical Arguments for Constitutional Democracy Peter J. Boettke Econ 828/Fall 2005 17 October

2. Main Methodological Points to Emphasize • Methodological Individualism • Catallactic Model of Politics • Normative Implications for a society of free men

3. Buchanan More philosophical and subtle Subjectivism Men are not just rats Normative individualism Tullock Relies on observation to drive questions Homo-economicus Natural economist Normative bent is there, but not overt Tension Between Buchanan and Tullock

4. The contribution to political philosophy and political economy • Social Choice Theory • Impossibility Theorem and its Import and Irrelevance • Decisions within Rules and Decisions over the rules • Veil of uncertainty construction • Costs of Decision Making • Unanimity principle • Externality principle • Bargaining within Politics • Log rolling, Pareto Improvements and Perversities • Fiscal Structure • Federalism and political competition (industrial organization of government)

5. Central Diagram of the Calculus of Consent Cost Costs Decision Making Costs Externality Costs % of Agreement Voting Rule

6. Buchanan’s Broader Contribution • 1986 Nobel Prize for the economic theory of politics • Buchanan as an ‘Austrian’ and ‘classical liberal’ • Buchanan and the rebirth of political economy

7. Contract or Coordination: The Contribution of Russell Hardin • Coercion, Exchange, Coordination • Shared values are neither a necessary nor sufficient condition for coordination in a complex society • “Liberalism, constitutionalism and democracy work for us because we are coordinated enough on various matters.” p. 17 • Conflicting nature of economic (practice in search of a theory) and political liberalism (theory in search of a practice) • Constitutions not as contracts, but as coordinative institutions which enable us to pursue mutual advantage and realize our interests (from Hobbes to Hume) http://www.nyu.edu/gsas/dept/politics/faculty/hardin/hardin_home.html

8. Conclusion • The Calculus of Consent established more than any other book the usefulness of applying economic concepts to address questions in political theory and political science • The Calculus of Consent demonstrated that pursuing the logic of individual choice and the benefits of exchange model provided a coherent argument for limited government that did not rely on rights-speak