COMPARATIVE PUBLIC POLICY:

A POLITICAL ECONOMY APPROACH

 

IP/GEN 262

 

Fall Quarter, 1996

 

Stephan Haggard and Matthew Shugart

 

 

Tuesday, 1-3:50

Office Hours

Matthew Shugart (1311; 4-5016):

Stephan Haggard (1224; 4-5781): Tues. 9:00-12:00 and by appointment

 

 

                The purpose of this course is to introduce students to a variety of theoretical literatures that seek to explain public policy, with a particular but not exclusive emphasis on economic policy. This enterprise should be distinguished from the normative theory of public policy or the question of what policies are optimal; we will consider such questions only insofar as they play into an understanding of the decision-making process.

                We begin with the problem of preference formation; why do actors have the policy preferences they do? We will then examine the problem of collective action, which effects not only the organization of social groups but is important for understanding a series of institutional questions as well.

                We then concentrate our attention on the analysis of democratic institutions, beginning with the "big" institutions--executives, legislatures, and party systems--before turning to the relationship between bureaucrats and politicians and the bureaucracy.  We then spend two weeks on the analysis of authoritarian regimes.

                The final three weeks of the course are devoted to applications and will center on some important debates in the literature on Latin America and East Asia.

                This is primarily a reading course; written assignments will therefore be limited. You are required to write three (3) papers during the course of the quarter. The papers will be no longer than five pages in length, and will provide a critical review of the literature assigned that week, or of some particular aspect of it that you find intriguing. The grade on any particular paper may be tossed out by simply writing an additional essay. The three papers will account for 60 percent of the grade. The remaining 40 percent will be based on class participation. Students are expected to do all the reading for each class session, and may be called upon at any time to provide summary statements of it.

 

 

1. Orientation (October 1)

 

2. Theories of Preferences and "Demand-Driven" Models of Politics  (October 8)

 

                Douglas Nelson, "Endogenous Tariff Theory: A Critical Survey," American Journal of Political Science 32, 3 (September 1988); sections on "demand side" models (796-817), skim the rest.

                Theodore Lowi, "American Business, Public Policy:  Case Studies and Political Theory," World Politics 16, 4 (July 1964).

                Robert Bates, "The Nature and Origins of Agricultural Policies in Africa," in Robert Bates, ed., Essays on the Political Economy of Rural Africa (Berkeley: University of California Press, 1983).

                Jeffry A. Frieden, "Invested interests: the politics of national economic policies in a world of global finance," International Organization 45, 4 (Autumn 1991), p. 437.

                Michael Levine and Jennifer Forrence, "Regulatory Capture, Public Interest and the Public Agenda: Toward a Synthesis," and comments by Katzmann and McNollgast, Journal of  Law, Economics and Organization 6 (Special Issue, 1990): pp. 167-98; 199-212.

                Dennis Mueller, Public Choice II (Cambridge UP, 1989), ch. 13 ("Rent-Seeking")

 

Recommended.

                Sam Peltzman, "Toward a More General Theory of Regulation," The Journal of Law and Economics 19, 2 (August 1976): 211-240.

                Gary S. Becker, "A Theory of Competition Among Pressure Groups for Political Influence," The Quarterly Journal of Economics 98, 3 (August 1983): 371-400.

 

3. The Theory of Collective Action (October 15)         

 

                Mancur Olson, The Logic of Collective Action (Cambridge: Harvard University Press, 1965), chapters 1, 2, 5, and 6.

                Donald P. Green and Ian Shapiro, Pathologies of Rational Choice Theory: A Critique of Applications in Political Science (Yale University Press, 1994), chapter 5.

                Joanne Gowa, "Public Goods and Political Institutions:  Trade and Monetary Policy Processes in the United States," International Organization 42, 1 (1988).

                Barbara Geddes, Politician's Dilemma (Berkeley: University of California Press, 1994, chapter 2.

                Gary Cox and Mathew McCubbins, Legislative Leviathan (UC Press, 1993), ch. 4.

 

Recommended:

 

                James E. Alt and Michael Gilligan, "The Political Economy of Trading States," The Journal of Political Philosophy2,2 (1994): 165-192.

 

 

4. Democratic Institutions and Policy Variations:  Theoretical Perspectives (Oct. 22)

 

           Thomas Romer and Howard Rosenthal, "Political Resource Allocation, Controlled Agendas and the Status Quo," Public Choice 33 (1978): 27-43. 

           Gary Cox, The Efficient Secret:  The Cabinet and the Development of Political Parties in Victorian England (New York:  Cambridge University Press, 1987). Read chapters 6 and 9-10; skim chapters 7-8.

           Matthew Shugart and John Carey, Presidents and Assemblies, pp. 7-15, 167-189.

           Terry M. Moe and Michael Caldwell, "The Institutional Foundations of Democratic Government:  A Comparison of Presidential and Parliamentary Systems," Journal of Institutional and Theoretical Economics 150/1 (1994): 171-95, and comments by Gebhard  Kirchgässner and Arthur Lupia.

           Matthew S. R. Palmer, "Towards and Economics of Comparative Political Organization:  Examining Ministerial Responsibility," Journal of Law, Economics, and Organization (forthcoming).

           Mark Ramseyer and Frances M. Rosenbluth, Japan's Political Marketplace (Cambridge:  Harvard University Press, 1993), chapters 1–3, 10.

           Michael Laver and Kenneth Shepsle, Cabinet Ministers and Parliamentary Government (Cambridge University Press, 1994), ch. 17.

           Matthew Shugart and Stephan Haggard, "Institutions and Public Policy in Presidential Systems," forthcoming in Haggard and McCubbins.   

 

Highly recommended:

 

           Alberto Alesina, "Political Models of Macroeconomic Policy and Fiscal Reform" in Stephan Haggard and Steven B. Webb, eds., Voting for Reform (Oxford 1994). 

 

5. Principal-Agent Relationships: Politicians and Bureaucrats                (Oct. 29)

               

                D. Roderick Kiewiet and Mathew D. McCubbins, The Logic of Delegation: Congressional Parties and the Appropriations Process (Chicago:  University of Chicago Press), chapter 2.

                Terry Moe, "Political Institutions: the Neglected Side of the Story," Journal of Law, Economics and Organization 6 (Special Issue 1990): 213-53.

                Mathew D. McCubbins, Roger Noll and Barry Weingast, "Administrative Procedures as Instruments of Political Control," Journal of Law, Economics and Organization 3, 2 (Fall 1987)

                Mathew D. McCubbins and Thomas Schwartz, "Congressional Oversight Overlooked: Police Patrols vs. Fire Alarms," in McCubbins and Terry Sullivan, eds., Congress: Structure and Policy (New York: Cambridge University Press, 1987).

                John Ferejohn and Charles Shipan, "Congressional Influence on Bureaucracy," Journal of Law, Economics and Organization 6 (Special Issue 1990): 1-27.

                Joseph P. Kalt and Mark A. Zupan, "The Apparent Ideological Behavior of Legislators:  Testing for Principal–Agent Slack in Political Institutions," Journal of Law and Economics 33 (April 1990).

                Susanne Lohman, "Federalism and Central Bank Autonomy:  The Politics of German Monetary Policy, 1952–1992," unpublished.

 

Recommended:

           Pablo T. Spiller, "Politicians, Interest Groups, and Regulators: A Multiple-Principals Agency Theory of Regulation, or 'Let Them be Bribed'," Journal of Law, Economics and Organization 33 (April 1990): 65-101.

           Terry M. Moe, "The Politics of Structural Choice:  Toward a Theory of Public Bureaucracy," in Oliver E. Williamson, ed., Organization Theory:  From Chester Barnard to the Present and Beyond (New York:  Oxford University Press, 1990).

           Randall L. Calvert, Mathew D. McCubbins, and Barry R. Weingast, "A Theory of Political Control and Agency Discretion," American Journal of Political Science 33, 3 (August 1989).

           Jonathan Bendor, "Formal Models of Bureaucracy," British Journal of Political Science 18 (1988): 353-95.

 

6. Theories of Organization with Applications to the Bureaucracy (Nov. 5)

               

                Terry Moe, "The New Economics of Organization," American Journal of Political Science 28: 739-777.

                Graham T. Allison, Essence of Decision:  Explaining The Cuban Missile Crisis  (Boston:  Little, Brown, and Company, 1971), pp. 32-6, 78-96, 162-81.

                Peter Evans, "The State as Problem and Solution:  Predation, Embedded Autonomy, and Structural Change," in Stephan Haggard and Robert R. Kaufman, eds., The Politics of Economic Adjustment (Princeton University Press, 1992).

                Murray J. Horn, The Political Economy of Public Administration (Cambridge UP, 1995), ch. 5.

                Robert Wade, "The Market for Public Office: Why the Indian State is Not Better at Development," World Development 13, 4 (April 1985).

               

               

7. Democratic Institutions and Policy Variations: the Politics of Budgets and Taxes (Nov. 12)

 

           Ellen Immergut, "Institutions, Veto Points, and Policy Results:  A Comparative Analysis of Health Care," Journal of Public Policy 10, 4.

           Allen Schick, "The Surprising Enactment of Tax Reform in the United States," and Michio Muramatsu and Masaru Mabuchi, "Introducing Tax Reform in Japan," in Samuel Kernell, ed., Parallel Politics:  Economic Policymaking in the United States and Japan (Brookings Institution, 1991).

           Allen Schick, "Governments versus Budget Deficits,"in R. Kent Weaver and Bert A. Rockman, eds., Do Institutions Matter?  Government Capabilities in the United States and Abroad (Brookings Institution, 1993).

           Mathew McCubbins and Frances Rosenbluth, "Party Provision for personal politics; dividing the vote in Japan," and Mathew McCubbins and Greg Noble, "The appearance of power: legislators, bureaucrats and the budget process in the United States and Japan" and "Perceptions and Realities of Japanese Budgeting," in Peter Cowhey and Mathew McCubbins, eds., Structure and Policy in Japan and the United States (Cambridge UP, 1995).

          

Recommended:

           R. Kent Weaver and Bert A. Rockman, "Assessing the Effects of Institutions," and other chapters in Weaver and Rockman, Do Institutions Matter?.

           Sam Kernell, "The Primacy of Politics in Economic Policy, in Kernell, ed., Parallel Politics:  Economic Policymaking in the United States and Japan (Brookings Institution, 1991).

 

8.  Japanese Industrial Policy and Regulation (Nov. 19)         

 

           Gregory Noble, "The Japanese Industrial Policy Debate," in Stephan Haggard and Chung-in Moon, eds., Pacific Dynamics: The International Politics of Industrial Change (Westview Press, 1989), pp. 53-96.

           Chalmers Johnson, MITI and the Japanese Miracle (Stanford University Press, 1982), chapters 1 and 2, pp. 3-82.

           Cut? Roger Noll, "Structural Policies in the U.S." and Haruo Shimada, "Structural Policies in Japan," in Samuel Kernell, Parallel Politics: Economic Policymaking in Japan and the United States (Brookings Institution, 1991).

           Daniel Okimoto, Between MITI and the Market (Stanford University Press, 1989), chapters 3 and 4.

           Cut? Ellis Krauss and Jon Pierre, "Targeting Resources for Industrial Change," in R. Kent Weaver and Bert A. Rockman, eds., Do Institutions Matter?  Government Capabilities in the United States and Abroad (Brookings Institution, 1993).

           Mark Ramseyer and Frances M. Rosenbluth, Japan's Political Marketplace (Harvard University Press, 1993), chapters 6 and 7.

           Mark Tilton, Restrained Trade: Cartels in Japan's Basic Materials Industries (Cornell UP 1995), chs. 1, 2 and 7.

           Roger Noll and Frances M. Rosenbluth, "Telecommunications Policy: Structure, Process, Outcomes," in Cowhey and McCubbins, Structure and Policy in Japan and the United States.

 

9. The Political Logic of Authoritarian Regimes (Nov. 26)    

 

           Mancur Olson, "Dictatorship, Democracy, and Development," American Political Science Review 87, 3 (September 1993): 567-76.

           J. Mark Ramseyer and Frances Rosenbluth, The Politics of Oligarchy (Cambridge UP, 1995), chs. 2 and 3.

           Douglass North and Barry Weingast, "The Evolution of Institutions Governing Public Choice in 17th Century England," Journal of Economic History 49 (1989): 803-32.

           Susan Shirk, The Political Logic of Economic Reform in China  (University of California Press, 1993) chapters 3-7.

           Dali L. Yang, "Governing China's Transition to the Market:  Institutional Incentives, Politicians' Choices, and Unintended Outcomes," World Politics 48 (April 1996): 424–52.

           Alfred Stepan, Rethinking Military Politics:  Brazil and the Southern Cone (Princeton University Press, 1988), especially chapters 1–5.

 

Recommended:

                Philip G. Roeder, Red Sunset:  The Failure of Soviet Politics (Princeton University Press, 1993), chapters 1, 2, and 10.

 

 

10. Policy-making in Authoritarian Regimes: East Asia and Latin America Compared (Dec. 3)

 

           Arturo Valenzuela, "The Consolidation of One-Man Rule in Chile," in Paul Drake, ed., The Struggle for Democracy in Chile, 1982-1990 (University of Nebraska Press, 1991).

           Barry Ames, Political Survival:  Politicians and Public Policy in Latin America (University of California Press, 1987), chapter 5.

           Cut? but what to replace it? Robert Kaufman, "Industrial Change and Authoritarian Rule in Latin America: a Concrete Review of the B-A Model," in David Collier, ed., The New Authoritarianism in Latin America (Princeton University Press, 1979).

           Eduardo Silva, "Capitalist Coalitions, the State, and Neoliberal Economic Restructuring: Chile, 1973-1988," World Politics, Vol. 45, No. 4 (July 1993).

           Tun-jen Cheng, "Political Regimes and Development Strategies:  South Korea and Taiwan," in Gary Gereffi and Donald L. Wyman, eds., Manufacturing Miracles : Paths of Industrialization in Latin America and East Asia (Princeton University Press, 1990).

           Robert Wade, Governing the Market (Princeton: Princeton University Press, 1990), chapter 7.

           Yun-han Chu. "State Structure and Economic Adjustment of the East Asian Newly Industrializing Countries," International Organization 43 (Autumn 1989).

           Jose Edgardo Campos and Hilton Root, The Key to the Asian Miracle (Brookings, 1996), chs 4 and 5.

 

11. Economic Reform in Latin America (Dec. 10)

 

           Geddes, Politician's Dilemma, chapters 3-7.   

           Robert R. Kaufman, Carlos Bazdresch, and Blanca Heredia, "Mexico:  Radical Reform in a Dominant Party System," in Stephan Haggard and Steven B. Webb, Voting for Reform:  Democracy, Political Liberalization, and Economic Adjustment (Oxford University Press, 1994).

           Juan Molinar Horcasitas and Jeffrey Weldon, "Electoral Determinants of National Solidarity," in Wayne A. Cornelius, Ann L. Craig, and Jonathan Fox., eds., Transforming State-Society Relations In Mexico : The National Solidarity Strategy. (University of California, San Diego:  Center for U.S.-Mexican Studies, 1994).

           Bruce M. Wilson, "When Social Democrats Choose Neoliberal Policies:  The Case of Costa Rica," Comparative Politics (January, 1994).

           Stephan Haggard and Robert Kaufman, The Political Economy of Democratic Transitions (Princeton 1995), chs. 5-7.

           Diego Abente, "The Political Economy of Tax Reform in Venezuela," Comparative Politics 22, 2 (January 1990).