Monday, May 5, 2008

Differing methods of interest group capture

Becker and Posner have posts up this week about the whys and wherefores of agricultural subsidies. Becker, in particular, notes that agricultural subsidies are the rule in wealthy countries, and therefore we shouldn't be blaming subsidies on uniquely American institutions, such as the disproportionate power of small states in the Senate or the position of Iowa in primary politics. He also compares the agricultural subsidies in rich nations to agricultural taxes in poor nations, and concludes that what's going on can be attributed to the power of small, comparatively rich interests groups (first-world farmers and third-world urbanites, respectively) to manipulate the government into privileging them at the expense of large, comparatively poor interest groups.

This is all well and good, and certainly true to some extent, but I think the analysis fails to deal with a key point, which is that governments in poor countries tend to be less stable than governments in rich countries, and are thus much more vulnerable to violent overthrow. Since the seat of the government is in the cities, and because cities are naturally more volatile due to high population density (and perhaps due to other factors such as weaker family structures and demographic differences, i.e. more young, unmarried, riot-prone men) this gives third-world urbanites a level with which to capture the state that is not based on being a small, rich interest group.

It seems to me that, historically, the factors that Becker points out are more important, as countries were better able to control their populations and keep the poor from migrating into the cities. Now, however, as the poor continue to move from rural areas into urban ones, the threat of violence becomes a larger concern.

As an added and unrelated bonus, this is the best thing I've read today (hit tip to Marc Ambinder).

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