Suurimmat yhteiskunnan kohtaamat vaarat ovat useammin sellaisen hallitusvallan tuottamia, jossa valta on yhden sijaan monien käsissä. Hallitusvallan ollessa monien käsissä on todennäköisempää että kukaan ei välitä yhteisestä hyvästä kuin vallan ollessa yksissä käsissä.
– Tuomas Akvinolainen teoksessaan De regno ad regem Cypri, joka myös nimellä De regimine principum tunnetaan
Adam Smith, who in the eighteenth century produced the most influental economics book ever written, argued that large joint stock corporations were almost hopelessly incompetent. With ownership widely dispersed, everybody’s business is nobody’s business; the managers can do what they like with the stockholders’ money. Smith predicted that corporations would succeed only with government support, expect in a few fields that required lots of capital and very little skill, such as banking and insurance.
He was wrong. Even with no special support from government (save for the privilege of limited liability) – even with special taxes imposed on them – corporations succesfully compete with owner-run firms and partnerships in a wide range of fields. At least part of his mistake was failing to predict the benign effects of the takeover bid.
You notice that a corporation is being mismanaged. You buy as much stock as possible – enough to let you take over the corporation, fire most of its executives, and install competent replacements. Earnings shoot up. The market value of your stock shoots up. You sell out and look for another badly managed firm. Such raids are discouraged by securities regulation and corporate managements but they (and their threat, which helps keep managers honest) may be the reason for the success of the corporation in the modern world.
The arguments that show corporations cannot work apply with still greater force to democratic government – there too, everybody’s business is nobody’s business. Most voters do not even know the names of most of the politicians who “represent” them. We cannot use takeover bids, or the threat of takeover bids, to keep our government honest and efficient, since votes are not associated with transferable shares – but one can imagine a world where they were.
Each citizen owns one citizenship, which includes one vote. If the country is badly run, someone buys a vast number of citizenships, elects a competent government, and makes a fortune reselling the citizenships at a higher price. The country need not be emptied in the interim; the enterpreneur can always rent his citizenships out between the time he buys them and the time he sells them.
INTRODUCTION: The Paradox of Democracy 1
CHAPTER 1: Beyond the Miracle of Aggregation 5
CHAPTER 2: Systematically Biased Beliefs about Economics 23
CHAPTER 3: Evidence from the Survey of Americans and Economists on the Economy 50
CHAPTER 4: Classical Public Choice and the Failure of Rational Ignorance 94
CHAPTER 5: Rational Irrationality 114
CHAPTER 6: From Irrationality to Policy 142
CHAPTER 7: Irrationality and the Supply Side of Politics 166
CHAPTER 8: “Market Fundamentalism” versus the Religion of Democracy 182
CONCLUSION: In Praise of the Study of Folly 205
– Bryan Caplanin tuoreen teoksen The Myth of the Rational Voter: Why Democracies Choose Bad Policies sisällöstä