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Public Choice

, Volume 127, Issue 3–4, pp 267–284 | Cite as

Political authority, expertise and government bureaucracies

  • Miltiadis Makris
Article

Abstract

By applying the Revelation Principle, we focus on how a sponsor, who possesses political authority, could minimise the efficiency losses when bureaucrats are experts - that is, when they control information about the true costs of public services production. Our results come in striking contrast to those in the literature on bureaucracies and public procurement. In a two-types setting, and in the absence of monitoring and control mechanisms, we find that the agency is productively efficient. Under certain conditions, the agency is also allocatively efficient, while, under others, the low-cost bureau oversupplies and the high-cost agency undersupplies its output.

Keywords

Public Choice Political Authority Public Output Optimal Contract Budgetary Process 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer Science + Business Media, Inc. 2006

Authors and Affiliations

  1. 1.Department of EconomicsUniversity of ExeterExeterUK
  2. 2.CMPO, University of BristolBristol
  3. 3.IEPS-EMOP, Athens University of Economics and BusinessAthens

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