POLI 441 Lecture Notes - Lecture 9: Truism, Economic Surplus, Collective Action
22 Oct 2018
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Document Summary
First issue pd: fear of exploitation by trading partners. Domestic politics: govs pandering to domestic interest groups with vested interests. The same concept that kindleberger uses to explain the need for a hegemon explains the power of interest groups. The pattern of distributional effect is the same for much of political reform: the many winners are diffuse, the few losers are concentrated. The few get their way in political econ. The many all gain a little (weak preferences) the few all lose a lot (intense preferences). Preferences get aggregated in an uneven fashion: those who are concentrated often have their way, even if or because they are few. They are the only ones to surmount the collective action problem. In the case of trade, consumers rarely lobby for lower prices (consumer surplus). Politicians care about re-election, which is achieved through two means: votes and resources to get votes.
