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Bureaucratic Provision: Influencing vs. Lying

Author

Listed:
  • Samarth Vaidya
Abstract
In this paper a public bureau can extract surplus value from the services it provides not only by misrepresenting its production costs to its oversight committee but also by influencing the perceptions of the legislative body such as the parliament or the congress and the public at large by costly argumentation. By juxtaposing the bureau's ability to "influence" with its ability to misreport or "lie", I examine the impact influencing might have on the bureau's incentives to lie and on the efficiency of bureaucratic provision. I find that a truth-telling equilibrium could exist where the bureau's ability to influence would deter it from lying and the level of bureaucratic provision would be efficient. However, there could also be an equilibrium where the bureau would lie in which case there would be either over-production or under-production. This suggests that even when the bureau only cares about extracting the surplus value of its production, there could still be over-production simply due to the bureau's ability to distort cost information

Suggested Citation

  • Samarth Vaidya, 2004. "Bureaucratic Provision: Influencing vs. Lying," Econometric Society 2004 Australasian Meetings 251, Econometric Society.
    • Handle: RePEc:ecm:ausm04:251
    as

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    References listed on IDEAS

    as
    1. Gary Miller, 1977. "Bureaucratic compliance as a game on the unit square," Public Choice, Springer, vol. 29(1), pages 37-51, March.
    2. Miller, Gary J. & Moe, Terry M., 1983. "Bureaucrats, Legislators, and the Size of Government," American Political Science Review, Cambridge University Press, vol. 77(2), pages 297-322, June.
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    5. Carroll, Kathleen A, 1989. "Industrial Structure and Monopoly Power in the Federal Bureaucracy: An Empirical Analysis," Economic Inquiry, Western Economic Association International, vol. 27(4), pages 683-703, October.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Bureaucracy; Influence; Truth-Telling;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption

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