politicians & bureaucrats

Question 1

bureaucrats

Answer 1

government officials, public servant, top civil servants

Question 2

examples of bureaucrats

Answer 2

examples: public hospital director, supervisor of social work division, chief of police detectives, superintendent of a school system

Question 3

difference between politicians and bureaucrats

Answer 3

politicians → policy formulators
bureaucrats → policy implementers

Question 4

what is the most common assumption about bureaucrats?

Answer 4

bureaucrats are budget-maximizers

Question 5

why are bureaucrats budget-maximizers? (3)

Answer 5

1. bureaucrat’s wage and benefits may be tied to the size of the budget
2. prestige & status
3. larger budgets help in achieving their ”mission”

Question 6

how does niskanen’s model of bureaucratic behavior characterize bureaucrats?

Answer 6

as budget-maximisers who exploit information asymmetries to their advantage

Question 7

assumptions in niskanen’s model about bureaucrats (6)

Answer 7

1. budget-maximizing bureaucrat
2. politicians are interested in output
3. preference for bureau’s output increases at a decreasing rate (diminishing marginal returns)
4. public bureaucracy engages in costly production
5. as the bureau becomes bigger & spends more, it becomes more inefficient (diminishing returns to scale)
6. asymmetric information between politicians & bureaucrats

Question 8

variations in niskanen’s model about bureaucrats (3)

Answer 8

1. corrupt bureaucrat
2. lazy bureaucrat
3. proactive politicians

Question 9

variables in niskanen’s model about bureaucrats (3)

Answer 9

1. B: bureaucrat’s budget
2. C: total costs
3. E: per-capita expenditure level

Question 10

corrupt bureaucrat

Answer 10

would produce competitive production level (socially efficient) but keep the profits (society doesn’t know TC) and keep difference B - TC

Question 11

lazy bureaucrat

Answer 11

not interested in maximizing B or maximizing profits (B - C); will choose lower production level (society cannot monitor bureaucrat’s effort or costs)

Question 12

proactive politicians

Answer 12

bilateral bargaining (reducing information asymmetry); niskanen’s assumption that politicians can’t know C is probably too strong

Question 13

what relationship is information asymmetry common in?

Answer 13

the principal-agent relationship

Question 14

principal-agent relationship

Answer 14

authority is located on one side (principal) and informational advantage on the other (agent)

Question 15

moral hazard problem

Answer 15

agents can exploit their advantage to pursue their own interests, at odds with those of the principal

Question 16

two types of control mechanisms to monitor agents

Answer 16

1. before-the-fact mechanisms
2. after-the-fact contractual arrangements

Question 17

before-the-fact mechanism

Answer 17

principals avoid selecting an incompetent/corrupt agent by authenticating the promises made by the agent

example: advice, letters of recommendation, testimonials, credentials, etc.

Question 18

after-the-fact contractual arrangements

Answer 18

making payment contingent on completion of specific tasks by specific dates

Question 19

why is niskanen’s model unrealistic?

Answer 19

1. politicians establish a bureaucracy to carry on their chosen policies
2. don’t implement pre- or post- control mechanisms

Question 20

types of “before-the-fact” control mechanisms (2)

Answer 20

1. appointment process
2. procedural controls

Question 21

types of “after-the-fact” controls (3)

Answer 21

1. public hearings
2. appropriations/budgeting decisions
3. allowing service recipients to bring bad behavior to attention of courts

Question 22

enacting coalition

Answer 22

veto players

Question 23

McCubbins, Noll & Weingast’s model for the relationship between veto players and bureaucrats

Answer 23

setting up a bureau & appointing the bureaucrats potentially requires the agreement among various veto players

Question 24

bureaucratic drift

Answer 24

theory explaining the tendency for bureaucratic agencies to create policy deviating from the original mandate

Question 25

coalition drift

Answer 25

the phenomenon of present legislation being overwritten by the changing views of political coalitions

Question 26

what does size of bureaucratic drift depend on? (2)

Answer 26

1. monitoring efforts/capabilities of the veto players
2. control mechanisms implemented

Question 27

bureaucratic drift vs. coalitional drift

Answer 27

• coalitional drift leads to frequent and sudden changes in power of bureaucracies
• both are tradeoffs

Question 28

how do politicians try to protect bureaucrats from coalitional drifts?

Answer 28

1. establishing long tenures
2. giving them more admin power
3. securing revenue sources