Economics and PA: Public choice theory, transaction costs theory, theory of expectations, and the enduring influence of economics modeling on PA-comparing the debate in the US and Europe

Abstract

This chapter looks at the utilization of economic theories-public choice, transaction cost, and expectancy theories-in Public Administration literature in Europe and the US. The research shows that mathematical models in the field are predominantly associated with public choice and rational choice theories that have strong microeconomic assumptions connected to them. Although the discussion surrounding economic modelling in Europe has been more critical in tone compared to the US, it has paradoxically led to a wider use of economic modelling driven by model upgrading. The chapter argues that the lack of general theory building in the Public Administration discipline, both in Europe and the US, drives the perpetuation of economic modelling in the field.