Markets, State, and People: Economics for Public Policy

Q: You have a book coming out soon, Markets, State, and People: Economics for Public Policy. Who is it aimed at: is it a textbook for students doing a public policy course or is it a book all politicians should read?

A: Both of the above. It’s billed as a textbook and it’s built on a course that I developed myself and have been teaching for some years. But it’s not technical and I hope is well enough written that anybody could enjoy reading it. So students for sure—undergraduates or MPP students—but also anybody working in public policy or in politics. What I try to do is demonstrate that there are some problems and some circumstances in which there isn’t a single right answer about how you do things, and there are choices and trade-offs to be made.

Sometimes state ownership is the right way to go. Sometimes you want a market structure. Sometimes you want neither of those and you want to leave it to some kind of community structure or other sort of organization. We have loads of those: firms themselves, but also unions and mutual societies and playgroups and so on. There are a lot of self-organized entities.

The book is trying to think through how you analyze the kinds of policy challenges that you face, to try to understand what to do about them. That might change at different periods of history or it might be different in different countries—or different sets of voters will just have different priorities. So it tries to be a very rounded book about how to select and implement public policies, while being really rooted in economic analysis.

Q: Was there a gap in the market then, in terms of an economics textbook about that kind of decision-making?

A: There was nothing that I could use to teach from. There’s the traditional approach to public economics, which does some macroeconomic stabilization policy, so tax and spend and monetary policy, and then does a lot about tax design and tax structures. What I wanted to think about was how you organize production and distribution and there wasn’t a book that answered that.