Special Interest Politics.

• Author: Munger, Michael
• Position: Book Review

By Gene M. Grossman and Elhanan Helpman Cambridge, Mass.: MIT Press, 2001. Pp. xv, 364. $40.00.

In a theoretical perspective, it is not clear why the study of interest groups is a separate subfield of political economy. After all, the problem of group formation is much like underprovision of public goods or overprovision of externalities. Group theory properly ought to be a branch of democratic theory and deal with the problem of distortions caused by "special" interests. The concept of distortion, however, requires a comparison of outcomes: What does the world of special interests look like, and how does it differ from a (possibly nonexistent) world in which special-interest groups play no role in politics?

This inquiry is more difficult than it might seem because, as Gene M. Grossman and Elhanan Helpman point out in their new book Special Interest Politics, "special-interest groups" (SIGs) admit of no easy definition. Nailing down the key differences between democratic politics and interest-group politics raises the difficulty. The definition used at the outset here is as follows: a SIG is an organization that takes action on behalf of an identifiable group of voters. Other analysts have used an apparently simpler definition: a group of voters with similar preferences. Grossman and Helpman sensibly adopt a definition with some empirical referents. An organization is something we can look for, and an identifiable group is a collection of individuals who resemble one another in some important respect, not just a collection of people with enough shared beliefs to have the potential to share goals and act on them.

The notion of an "interest" group dates from Thrasymachus's claim in Plato's Republic that "justice is nothing else than the interest of the stronger." Throughout much of this dialogue, Socrates and Thrasymachus debate the idea of interest. They find interest difficult to define because it would appear that each person may have both a self-interest and a collective interest, which might conflict. They argue that every "art" or profession has its own interest, which is the "perfection" of that art. In this view, problems may arise. For example, should it be true that "medicine does not consider the interest of medicine, but the interest of the body?... no physician, in so far as he is a physician, considers his own good in what he prescribes, but the good of his patient; for the true physician is also a ruler having the human body as...