Question

One of the key underpinnings of public choice analysis is the assumption that politicians and bureaucrats

make political decisions based on self‑interest, just as individuals and firms do.

make political decisions based primarily on benefiting future generations.

seek only to maximize long term economic growth through increasing GDP.

act not out of self‑interest but desire to increase the general utility of the public.

Answer 1

Answer:

a. make political decisions based on self‑interest, just as individuals and firms do.

Explanation:

Public choice analysis is the combination of political science and economics and analyzes political decision making. One key assumption of public choice theory is that politicians are rational, self‑interested, economic agents. Like all other economic agents, they make decisions based on their own self‑interest (specifically, to satisfy constituents and retain their positions). It leads to rise of interest groups, logrolling and rent seeking behavior from the politicians and bureaucrats which leads to inefficiency.