caa a22 4500 606167854 CHVBK 20210128100704.0 cr unu---uuuuu 210128e20150701xx s 000 0 eng 10.1007/s11127-015-0262-y doi (NATIONALLICENCE)springer-10.1007/s11127-015-0262-y The anatomy of government failure [Elektronische Daten] [William Keech, Michael Munger] Government failure is a much bigger problem than its contemporary treatment implies. Setting aside natural disasters, most of the great catastrophes of human history have been government failures of one sort or another. We argue that many so-called market failures are government failures because government defines the institutions in which markets succeed or fail. The concept of government failure has been trapped in the cocoon of the theory of perfect markets. Narrowly defined deviations from market perfection have been designated market failures, for which government corrections may or may not really be a solution. Government failure in the contemporary context means failing to resolve a classic market failure. We propose an alternative approach for evaluating whether government fails: the Pareto standard. If an available Pareto improvement is not chosen, or is not implemented, that is a government failure. We organize government failure into two types: substantive and procedural. Substantive failures include the inability or unwillingness to maintain order, to maintain sound fiscal and monetary policies, and to reduce risks of transaction costs, which we classify as corruption, agency and rent-seeking. Procedural failures are inadequacies of available social choice mechanisms, causing collective decisions to be arbitrary, capricious, or manipuated. We conclude with some reflections on human rationality and the implications of behavioral economics. Springer Science+Business Media New York, 2015 Market failure nationallicence Government failure nationallicence Competitive equilibrium theory nationallicence Collective choice mechanisms nationallicence Keech William Department of Political Science, Duke University, Durham, USA aut Munger Michael Department of Political Science, Duke University, Durham, USA aut Public Choice Springer US; http://www.springer-ny.com 164/1-2(2015-07-01), 1-42 0048-5829 164:1-2<1 2015 164 11127 https://doi.org/10.1007/s11127-015-0262-y text/html Onlinezugriff via DOI BK010053 XK010053 XK010000 Metadata rights reserved Springer special CC-BY-NC licence nationallicence 1 editorial jats NATIONALLICENCE NATIONALLICENCE NL-springer NATIONALLICENCE 856 40 https://doi.org/10.1007/s11127-015-0262-y text/html Onlinezugriff via DOI NATIONALLICENCE 700 1- Keech William Department of Political Science, Duke University, Durham, USA aut NATIONALLICENCE 700 1- Munger Michael Department of Political Science, Duke University, Durham, USA aut NATIONALLICENCE 773 0- Public Choice Springer US; http://www.springer-ny.com 164/1-2(2015-07-01), 1-42 0048-5829 164:1-2<1 2015 164 11127