Public Choice Theory and Law
- Author(s):
- Jeremy Kidd, Todd J. Zywicki
- Posted:
- 07-2025
- Law & Economics #:
- 25-09
- Availability:
- Full text (most recent) on SSRN
ABSTRACT:
Public choice theory applies economic principles—especially rational self-interest, incentive structures, and methodological individualism—to the study of political and legal institutions. While traditionally used to explain legislative and regulatory behavior, this entry explores how public choice insights apply more broadly across the legal landscape. Concepts such as concentrated benefits and dispersed costs, rational ignorance, and rent-seeking help explain how legal actors—judges, litigants, bureaucrats, and interest groups—interact within institutional constraints. The entry examines how these dynamics shape the evolution of litigation, the behavior of administrative agencies, and even constitutional change. By grounding legal processes in the same incentive-driven analysis used in economics, public choice theory offers a powerful explanatory framework for why legal outcomes often diverge from publicly stated goals.