Buchanan and Clubs, How Dubious Was the Concept? A Comment on Darity, Camara, and MacLean

Abstract

In a recent article, William Darity, M’Balou Camara and Nancy MacLean (2023) argue that economist W. H. Hutt was a white supremacist. In their analysis, Darity et al. refer to a claim Hutt made about ‘exclusive clubs’ in a paragraph in which they also mention James Buchanan’s article on clubs (1965) and segregation in Virginia in the 1950s and 1960s. Although Darity et al. do not claim that Hutt’s racism, segregation and Buchanan’s clubs are connected, a careless reading of the paragraph could lead to misinterpretations. This comment was written to remind readers why Buchanan invented the concept of clubs and is to show that no evidence can be given to defend the idea that Buchanan’s theory of clubs would have been envisaged as a segregationist tool. Buchanan was trying to deal with a problem of public finance – the pricing of public goods.

Keywords:

• Buchanan
• Hutt
• clubs
• public finance
• public economics

Acknowledgements

Many thanks to Peter Boettke, Art Carden, Andrew Farrant and John Meadowcroft for their comments on a previous version.

Disclosure Statement

No potential conflict of interest was reported by the author.

Notes

1 I am borrowing the words from one referee of this paper, whom I am quoting.

2 Buchanan to Samuelson, 4 March 1955, Buchanan Papers: James M. Buchanan papers, C0246, Box: 176, Folder: 9, Special Collections Research Center, George Mason University Libraries.

3 On 2 May 1956, Samuelson wrote to Buchanan what seems to be a last letter, in which he clearly expressed his disagreement: ‘Alas, I have been so busy that I have simply not been able to find the time to give this [Buchanan’s note] the attention it assuredly deserves. I did give the manuscript a quick reading the day it arrived, and it gave me the impression that your interpretation of my writings differs considerably from my own’ (Samuelson to Buchanan, 2 May 1956, Buchanan Papers: James M. Buchanan papers, C0246, Box: 176, Folder: 9, Special Collections Research Center, George Mason University Libraries).

4 Buchanan mentioned ‘An Economic Theory of Clubs’ in a letter he sent to George S. Tolley, when discussing the possibility of presenting papers in February 1965 at North Carolina State University – the branch of the University of North Carolina in Raleigh: ‘I could talk on “An Economic Theory of Clubs”, which will be published soon in Economica. Or alternatively, I could talk on the topic “Some Fallacies in the Interpretation of Highway Costs”, a paper that I have not written, but which I hope to get started on during this term’ (Buchanan to Tolley, 7 October 1964).

5 He had ‘come to the view that all the stuff on trying to “price” highways by measuring marginal costs of congestion, a position that [he] firmly supported in the past, is conceptually wrong because it is impossible’ (Buchanan to Tolley, 7 October 1964).

6 Musgrave was even the first economist to characterise public goods with the two criteria that are now used in textbooks in public economics, non-rivalry and non-exclusion (see Desmarais-Tremblay 2017).

7 Buchanan reviewed Musgrave’s treatise just after it was published, noting that ‘This book … should become obligatory reading for all serious students of public finance, and it should remain the standard reference work for graduate study and advanced scholarship for many years’ (Buchanan and Musgrave 1960, 234).

8 On the history of free-riding, see Tuck 2008; Fontaine 2014.