Public choice and law and economics were distinct revolutions in economic
thought, expanding the economic method of homo economicus into areas
traditionally reserved for other disciplines. Both developments took place at
approximately the same time (the 1950s and 1960s), and many of the same
scholars participated in laying the theoretical foundations in both public
choice and law and economics. A partial listing in no particular order would
include Ronald Coase, James Buchanan, Gordon Tullock, Gary Becker,
Richard Posner, George Stigler, Henry Manne, Armen Alchian, Harold
Demsetz, and still others. Over time, as these new subdisciplines found
acceptance as “normal science,” the two areas of research evolved into courses
and research programs that were and largely remain independent of one
another. Recognizing that I am painting with a broad brush, the law and
economics subdiscipline grew into a largely normative enterprise of evaluating
legal rules and institutions relative to some normative standard such as
economic efficiency. One branch of public choice produced what sometimes
seemed like never-ending and highly complicated analyses of voting rules
and other political institutions. But a second tradition of positive public
choice also emerged, in which economic methods were applied to politics
and political decision-making in order to understand how government
worked as opposed to how it “ought” to work. In the positive economic
approach, government is not decried as being “inefficient” in some sense,
but rather is seen as a purposeful enterprise organized, staffed, and run by
the children of Adam Smith and Bernard Mandeville.