I voted for some politicians yesterday. I won't get another opportunity to get them to sit up an pay attention for another year or more. But I also "voted" with my dollar for organic produce at the supermarket, a couple books at Barnes & Nobles, and gas at the gas station--and these opportunities to let others know of my preferences are ongoing all the time.So are these processes different or essentially the same?
One key difference between expressing preferences through political process and through markets is the comparative position of losers in each process. The voter who casts his vote for the losing choice in an election has expended his vote and must accept the choice of others. But the buyer in a market who does not find exactly what he is looking for can keep his dollar and may spend it on a second-best good of his own choosing or save it for later.
One of my favorite passages from Bruno Leoni talks about these differences and others, in describing scholarly works of Duncan Black and James Buchanan comparing politics and markets:
... the popular saying, "one dollar, one vote," is only partially appropriate. In the market choice the invididual is the choosing entity as well as the entity for which the choices are being made; whereas in voting . . . while the individual is the acting or choosing entity, the collectivity of all the other individuals is the entity for which the choices are made. Moreover, the act of choosing in the market and the consequences of choosing stand in one-to-one correspondence. On the other hand, the voter can never predict with certainty which of the alternatives present will be chosen.
Buchanan indicated other fundamental differences between the two processes. . . 'since voting implies collective choice, the responsibility for making any social or collective action is necessarily divided, and there is no tangible benefit or cost directly imputable to the chooser in the polling place in connection with his personal choice.' The result is probably a less precise and less objective consideration of alternative costs than takes place in the minds of individuals choosing in the market. A further and more important distinction... is that group choices, so far as the individuals belonging to the group are concerned, tend to be ... 'of the all or none variety.' . . . The voter who loses initially makes one choice but eventually has to accept another that he has previously rejected.
From Freedom and the Law.