James McGill Buchanan, Jr. (born October 3, 1919) is an American economist renowned for his work on public choice theory, for which he won the 1986 Nobel Prize in Economics. Buchanan's work opened the door for the examination of how politicians' self-interest and non-economic forces affect government economic policy.
Buchanan has long been a professor at George Mason University, and is a central figure in the Virginia school of political economy. Buchanan also held teaching positions at the University of Virginia (founding the Thomas Jefferson center), UCLA, Florida State University, the University of Tennessee, and the Virginia Polytechnic Institute (with the Center for the Study of Public Choice]). Buchanan moved with the center to its new home at GMU. Buchanan's work in economics included a rigorous analysis of the theory of logrolling.
Buchanan's book, The Calculus of Consent (1962), co-authored with Gordon Tullock, is considered one of the classic works that founded the discipline of public choice, a melding of economics and political science. In particular (1962, p. v), the book is about the political organization of a free society. Buchanan writes that its method, conceptual apparatus, and analytics:
[A]re derived, essentially, from the discipline that has as its subject the economic organization of such a society.
The Calculus of Consent argues that government decisions are part of the economy, not exogenous factors. Therefore, methods of collective decisions must be studied as part of the study of the public sector. Calculus further describes the constitution as the line that is drawn between private and collective action. Public choice is then divided between pre- and post-constitutional phases.
Buchanan has also written extensively on the theory of the fiscal constitution. His work The Power to Tax: Analytical Foundations of a Fiscal Constitution (with Geoffrey Brennan) was ground breaking on how fiscal decisions are made. Buchanan's writings have also challenged traditional assumptions about the role of self interest in political decision making.
Public Choice theory has evolved into two branches a normative branch which attempts to derive principles of an appropriately organized set of public decisions, and a positivist branch which attempts to develop predictive theories of behavior.