Public choice lessons from the wizarding world of Harry Potter.

Author:Podemska-Mikluch, Marta
Position:ECONOMIC EDUCATION
 
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  1. Introduction

    The Harry Potter series is an abundant resource for any instructor interested in teaching public choice to undergrads. (1) In addition to the incredible popularity of the series, (2) there are two other reasons for using it to teach public choice. First, by keeping politicians and bureaucrats at the forefront of the story, Rowling helps students think about political incentives and focuses the class discussion on individual decision makers. Second, using fictional characters centers the discussion on the political mechanism, keeping it free from partisan digressions.

    Even though the tradition of chalk and talk remains strong in economics (Watts and Becker 2008), economists have made significant contributions to the development of edutainment--a form of pedagogy that aims to educate through entertainment. For example, Dixit (2005) demonstrates how to use a mixture of multimedia resources to engage students in a game theory course. Others suggest using various collections of TV and movie clips to illustrate basic economic concepts (Leet and Houser 2003; Mateer 2004; Mateer, Ghent, and Stone 2011). Some focus on individual shows, such as The Simpsons (Hall 2005; Gillis and Hall 2010; Luccasen and Thomas 2010; Hall 2014), Seinfeld (Dixit 2012; Ghent, Grant, and Lesica 2011), or, most recently, South Park (Hoffer and Crowley 2015). Others recommend using such atypical tools as podcasts, comic strips, or even music (Lawson 2006; Lawson, Hall, and Mateer 2008; Van Horn and Van Horn 2013; Luther 2015).

    The edutainment literature has focused primarily on supplying examples, or short stories, for instructors to use while introducing new material. Storytelling has been recognized as a great tool for helping students connect the new material to what they already know, and examples from popular culture are a great source of stories (Salemi 2002; Barkley 2009; Heath and Heath 2007; Gottschall 2012; Brown and McDaniel 2014). For this reason, we devote most of the paper to cataloguing examples that illustrate the key concepts of public choice. We focus on three key lessons: incentives in markets vs. politics, rent seeking, and rules vs. discretion. We also suggest a classroom activity that helps students absorb these ideas.

  2. Self-Interest vs. Social Interest in Markets and Politics

    In most economic formulations, the state is presented as having "an existence, a value pattern, and a motivation independent of those of the individual human beings claiming membership" (Buchanan and Tullock 1962). This organic vision, where the state is charged with maximizing the social welfare function, is at the core of the public interest theory approach to government (Samuelson 1954, 1955). This approach closely overlaps with the approach most students bring into the classroom, as evidenced by students' frequent references to what the government should and should not do. However, to understand public choice, students need to discover that government is not an acting entity, but rather that governmental outcomes are generated through interactions among many individuals. Students also need to learn that political actors are not significantly different from market actors. Rather, what is different are the incentives embedded in markets versus politics.

    While Adam Smith's (1776) famous words explain how the market mechanism aligns the butcher's self-interest with the interests of other market participants, students will quickly realize that in politics, personal and social interests are not as easily aligned. The wizarding world of Harry Potter is of great help in conveying this point, because it is inhabited by a remarkable number of political characters that are not significantly different from other wizards and Muggles (nonmagical folks). In fact, ethical and ethically dubious characters are as easily found among the wizarding politicians and bureaucrats as among those in other trades and professions.

    A key public figure portrayed in the series is Cornelius Fudge--the head of the Ministry of Magic, which was established to keep the wizarding world secret from Muggles. We first meet the Minister for Magic when he arrives at Hogwarts to deal with a series of attacks on Muggle-born witches and wizards, in the early weeks of Harry's second year (Rowling 1999a, chap. 14). From the perspective of the public interest theory of government, the ministry should investigate every single crime until the culprit is found or until the marginal social benefit of investigation is greater than its marginal social cost. Yet, doing so is not conducive to the career advancement of the key decision makers. (3) So even though the suspect of the attacks is unknown, Fudge decides to send Rubeus Hagrid--a half-giant gamekeeper--to prison:

    "Look at it from my point of view," said Fudge, fidgeting with his bowler. "I'm under a lot of pressure. Got to be seen to be doing something. If it turns out it wasn't Hagrid, he'll be back and no more said. But I've got to take him. Got to. Wouldn't be doing my duty--" (Rowling 1999a, chap. 14). (4)

    This scene can be used to open a number of classroom discussions: for example, a rational choice analysis of Fudge's decision. If asked about the benefits and costs of Fudge's choice, students will quickly notice that the benefits of arresting Hagrid are greater than the costs. The minister gets credit for resolving the mysterious attacks and boosts public image by appearing as a proactive public servant. Of course, as with any other choice, arresting Hagrid also comes with a cost: a risk of public opinion backlash once it becomes clear that an innocent man was arrested. But that risk is too small to outweigh the benefits: Fudge realizes that Hagrid's half-breed status means few will pay attention to Fudge's mistake. Students are sure to notice that it is Hagrid's vulnerability in the public eye that makes him an excellent suspect. (5)

    While Fudge's behavior may seem possible only in a highly corrupt government, similar dynamics are not uncommon in modern democracies. Researchers have documented that when under pressure to resolve a case, police frequently end up focusing the investigation on a suspect with a low socioeconomic status. This is not necessarily because of a bias, but because among the suspects, this demographic is least likely to mount a strong defense or to arouse public support (Garrett 2011). Once there is a suspect, the investigation changes from investigating the crime to finding the evidence. As suggested by the growing number of wrongful...

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