What is Public Choice and Market Process?
Public Choice
Economics traditionally focuses on the behavior of firms and consumers and how individuals interact in market settings. Public choice builds on economic and political theories to analyze the behavior of voters, candidates, legislators, bureaucrats, and the institutions under which they operate.
Public choice uses modern economic tools to study problems that are traditionally in the sphere of political science. (A more general term is 'political economy', an earlier name for 'economics'.)
In particular, public choice models the behavior of voters, politicians, and government officials as (mostly) self-interested agents and analyzes their interactions under a variety of institutional settings. Public choice analysis has roots in positive analysis ("what is") but is often used for normative purposes ("what ought to be"), to identify a problem or suggest how a system could be improved by changes in institutions.
Market Process
Market Process theory emphasizes that the market is a process, rather than how the alignment of prices, qualities, and quantities lead to an equilibrium. This theory argues that wherever equilibrium conditions have not been met, incentives are created so that the imbalances in the market are eliminated.
Learn More:
Public Choice
The “Virginia School” and Public Choice
Center for the Study of Public Choice
European Public Choice Society
Market Process
Competition, Regulation, and the Market Process: An "Austrian" Perspective
