ABSTRACT
This chapter provides an introduction to the interest-group theory of government and aims to compare and contrast the public interest and private interest models of the public policy process. The interest-group theory of government is frequently brought to bear in the analysis of economic regulation because the theory was first articulated as a way of explaining the wide divergence observed between the actual and intended effects of this type of intervention into the private economy. The role of political representatives in the setting is to match demanders and suppliers of wealth transfers. The attitude of scholars toward economic development policies in the late 1990s parallels the conventional wisdom about economic regulation circa 1970. The most pressing problem facing the leader of an autocratic or limited autocratic government is that of maintaining a stable supporting coalition. The chapter concludes with a discussion of the implications of the interest-group model for economic development.
