The Definition Of Key Theory Of Public Choice Theory

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Introduction: The public choice theory is commonly understood as the application of economics to the study of political processes and institutions. Methodologically, public choice theory is based on a couple of elements: methodological individualism and rational choice. It draws its ideological support from the New Right philosophy. The New Right is a group of thinkers who believe in a range of ideologies which seek to promote, among others, free market, anti-welfarist, libertarian, and sometimes socially authoritarian policies. With its explicit market bias, the public choice theory seeks to dispense with public bureaucracies as they tend to oversupply and overspend. The intellectual roots of public choice date back at least to the work of Adam Smith, whose "The Wealth of Nations" (first published in 1776) is the intellectual rock on which neoclassical economic theory is constructed. Smith’s great insight was that people acting in pursuit of their own self-interest could, through the mechanism of the “invisible hand,” produce collective benefits.

2. Definition of Concepts
2.1 Public
According to Hornby (2010:1184), "public" refers to people in a society connected with the government and the services it provides.
2.2 Choice
"Choice" is described as an act of choosing between two or more possibilities (Hornby, 2010:246).
2.3 Theory
A theory is a hypothesis or a system of ideas envisioned to explain something, especially one based on general principles independent of the thing to be explained.
2.4 Public Choice Theory
Public Choice Theory is a neoclassical economic theory applied to the public sector. It seeks to build a bridge between microeconomics and politics by viewing the actions of citizens, politicians, and public servants as similar to the actions of self-interested producers and consumers (Jary and Jary, 2000).