ABSTRACT
Public finance scholars have developed a field called public choice. The theory of public choice analyzes how the amount of public goods is selected, especially in local jurisdictions. Its main framework is demand-and-supply schedules for public goods based on microeconomics. The theory also accounts for political, legal, and institutional conditions that might affect the fiscal choice over public goods. Therefore, the public choice theory is often called the theory of political economy. Buchanan and Tullock contended that the logical, economic model could not explain all aspects of the complicated political process; it could explain only certain elements of modern political activities. Scholars have contended that political, legal, and institutional procedures and conditions affect the decision about the level of public expenditures. Although the median voter theorem has been frequently employed to observe fiscal choice in local jurisdictions, it has been criticized for its negligence in accounting for other variables such as political and institutional factors in deciding public expenditures.
