Everett Ehrlich invokes Nobel Laureate Ronald Coase as Ehrlich interprets the success of Howard Dean in terms of reduced transactions costs in setting up a political organization.
the Internet has changed all that in one crucial respect that wouldn’t surprise Coase one bit. To an economist, the “trick” of the Internet is that it drives the cost of information down to virtually zero. So according to Coase’s theory, smaller information-gathering costs mean smaller organizations. And that’s why the Internet has made it easier for small folks, whether small firms or dark-horse candidates such as Howard Dean, to take on the big ones.
On the other hand, in Montgomery County, Maryland, the Gazette writes,
Against a backdrop of a fiscal crisis for the county and strong sentiment against raising taxes, the County Council and the Duncan administration are looking for ways to trim expenses. The teachers believe their health benefits might be a prime target.
The Nov. 3 newsletter of the Montgomery County Education Association, which represents the school system’s 11,000 teachers in contract negotiations, took on the issue.
I’ll believe that the structure of politics has changed the day that someone can get elected to the local School Board or County Council without the endorsement of the teacher’s union.
UPDATE: Professor Bainbridge correctly points out that Ehrlich failed to demonstrate a connection between the Coase theory of the firm and politics.
For Discussion. Is a reduction in communication costs the critical factor in Dean’s success?
READER COMMENTS
Steve
Dec 14 2003 at 10:27am
–>Is a reduction in communication costs the critical factor in Dean’s success?
Eric Krieg
Dec 15 2003 at 10:04am
The critical factor in the Dean candidacy is RAGE. There are a lot of pissed off Democrats out there. They’re pissed about Florida 2000. They’re pissed about the tax cuts. They’re pissed about “No Child Left Behind” (ask a teacher about it sometime to hear the rage). They’re pissed about Iraq (probably more so now that Sadaam is in our custody).
Basically, they’re pissed that Dubya is OBVIOUSLY on a mission from GOD. And how can you compete with that?
Steve
Dec 15 2003 at 10:48am
Eric–I’ll see your “RAGE” and raise you a “FEAR and LOATHING”.
Eric Krieg
Dec 15 2003 at 10:57am
Fear and loathing it is.
You remember who invented that phrase, right? Seems like the perfect poster boy for the Democrats. Johhny Depp even made a movie, perfect for the illiterate Democrat masses!
In any case, the internet has nothing to do with it. In fact, Dean has come on strong only after “the mainstream media” discovered him.
Steve
Dec 15 2003 at 11:02am
Ghephardt will still give him a run. Gep’s got my vote in the primary, unless Ross decides to jump back into the GOP and run.
mcwop
Dec 15 2003 at 11:08am
His success is due to rage, and blogs.
Lawrance George Lux
Dec 15 2003 at 1:12pm
The cheaper Costs of communication have relatively little to do with it. Dean enjoyed many advantages before the Internet. He is an ex-Governor of a State, proving to the American people that he can administrate; remember, The American Electorate favors ex-Governors–Carter, Reagan, Clinton, George W. Bush. This prior Governorship introduced him to national Democratic leadership, and built his political campaign organization with its political contribution network. Dean would have been a Contender anyway. lgl
Monte
Dec 15 2003 at 3:04pm
The GOP is more responsible for Dean’s success than low-cost communications. They’re behind the Dean media juggernaut because they believe he’s the ideal candidate for Bush to beat. He’s too far left for most voters, he approves of Bush’s foreign policy (regarding Israeli/Palestinian relations and our intervention in Liberia), and he’s polarized his party more than any other democratic candidate. Finally, in spite of all the hype about internet contributions, he’s not likely to raise enough money to contend with Bush’s $500 million campaign kitty. Talk about the perfect foil!
I suspect there’s going to be a lot of cross-over voting done toy soldier republicans in the Democratic primary to ensure Dean gets set up for failure. In the spirit of the season, perhaps the RNC’s clandestine operations squad should rubber stamp this one “Operation: Nutcracker” (sorry).
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