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It is commonplace to view market agents as self-interested knaves, while government agents are either as knaves or public-spirited angels. What are the consequences of these different motivational assumptions in modeling governmental and market behavior? We compare David Hume, James M. Buchanan, and Richard Musgrave. We claim that Hume, the only one thinking consistently in terms of the worst-case, offers a second best solution for both the government and the economy, which may turn out to be the best possible solution given human nature. Because of the reciprocal check, two knaves are better than one. More is preferred to less even with vices…


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History of Political Economy

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