Democracy and the left–right continuum

In his seminal work, An Economic Theory of Democracy (1957), Downs introduced a left–right axis to economic theory.^[6] On the "left" he placed communist parties that want entirely state-planned economies, and on the "right" he placed conservative parties that demand an entirely deregulated economy.^[7]

He claimed that most voters have incomplete information when voting for political candidates in a democracy, and therefore will resort to economic issues of "how much government intervention in the economy there should be" and how parties will control this. Downs borrowed the curve from Harold Hotelling, who developed it to explain how grocery stores targeted customers. Downs's book has since become one of the most cited books in political science. His left–right axis model has been integrated into the median voter theory first articulated by Duncan Black.^[8]

In An Economic Theory of Democracy (1957), an early work in rational choice theory, Downs posited the paradox of voting, which claimed that significant elements of political life could not be explained in terms of voter self-interest. Downs showed that in democracies the aggregate distribution of political opinion forms a bell-shaped curve, with most voters possessing moderate opinions; he argued that this fact forces political parties in democracies to adopt centrist positions.^[9]

Housing and traffic policy

Later, Downs concerned himself with housing policy,^[10] writing about rent control and affordable housing. The Revolution in Real Estate Finance (1985) predicted a long-term housing slowdown and decrease in housing prices. Downs had involved himself with transportation economics.

In 1962, Downs published his Downs's Law of Peak-Hour Traffic Congestion. This law states that on urban commuter expressways, peak-hour traffic congestion rises to meet maximum capacity. Therefore, expanding the expressway network does not help against traffic jams. A complex set of forces lie behind this law, which were analyzed by presentation of a model of commuter decision-making and its underlying set of assumptions.^[11] Sometimes this effect is referred to as Induced demand. By the same token, e.g. the 1965 Highway Capacity Manual stated that the capacity of a highway or motorway increases with decreasing traffic speed, until its maximum capacity is reached at about 50 km/h (30 mph).^[12] (Cf. Braess's paradox.)

His book, Stuck in Traffic (1992), which detailed the economic disadvantages of traffic congestion and proposed road pricing as the only effective means of alleviating it, was denounced by traffic engineers for its insistence on the futility of congestion relief measures. However, enough of his gloomy predictions about congestion were proven correct that he successfully published a second edition, Still Stuck in Traffic (2004).^[13][14]

Downs's recommendations are starting to see implementation, largely in the form of high-occupancy toll (HOT) lanes in the medians of crowded American freeways, and through congestion pricing, already implemented in several cities around the world: Singapore^[15] (see Area Licensing Scheme and Electronic Road Pricing); London (see London congestion charge); Stockholm (see Stockholm congestion tax); Valletta, Malta;^[16][17] and Milan, Italy.^[18][19][20]

He joined the Brookings Institution, an American thinktank, in 1977. He continued his work on housing policies and traffic issues management at the institute.^[2][21]

He was the author or co-author of 24 books and more than 500 articles. His most influential books are An Economic Theory of Democracy (1957) and Inside Bureaucracy (1967); widely translated, both are credited as major influences on the public choice school of political economy.^[2][22][23]

He was a visiting fellow at the Public Policy Institute of California in San Francisco, between 2004 and 2005.^[22]