Review 7 The Economics of Political Action Flashcards
Transfer payments
Payments to individuals or institutions that are not linked to the current supply of a good or service by the recipient.
Public choice analysis
The study of decision-making as it affects the formation and operation of collective organizations, like government. In general, the principles and methodology of economics are applied to political science topics.
Rational ignorance effect
Because it is highly unlikely that an individual vote will decide the outcome of an election, a rational individual has little or no incentive to search for and acquire the information needed to cast an informed vote.
User charges
Payment users (consumers) are required to make if they want to receive certain services provided by the government.
Special-interest issue
An issue that generates substantial individual benefits to a small minority while imposing a small individual cost on many other citizens. In total, the net cost to the majority might either exceed or fall short of the net benefits to the special interest group.
Logrolling
The exchange between politicians of political support on one issue for political support on another.
Pork-barrel legislation
A package of spending projects bundled into a single bill. It is often used as a device to obtain funding for a group of projects intensely desired by regional or interest groups that would be unlikely to pass if voted on separately.
Shortsightedness effect
The misallocation of resources that result because public-sector action is biased 1) in favor of proposals yielding clearly defined current benefits in exchange for difficult-to-identify future costs and 2) against proposals with currently identifiable costs that yield less concrete and less obvious future benefits.
Rent-seeking
Actions by individuals and groups designed to restructure public policy in a manner that will either directly or indirectly redistribute more income to themselves or the projects they promote.
Bundled choices
In order to choose a few options, you have to select all. For example, when voting for a legislator who has some positions you favor and some you don’t.
What is the probability that an individual vote will decide a city, state or national election?
virtually zero
Political democracy
Political rulers gain power by winning a majority, or possibly a plurality, of votes.
Market democracy
Consumers have the power to determine what is sold by purchasing items that they are willing to pay for.
