Theoretical and Applied Economics
No. 2 / 2016 (607), Summer
A common agency within bureaucracy
University of Cologne, Germany
Abstract. We explore the welfare implications of multiple principals in the top level of bureaucracy. An agent has to carry out two separate tasks, which can either be organized by two separate principals, or combined under one principal. The relationship between the top level (the principals) and the lower level (agent) of bureaucracy is a “principal-agent problem”. The presence of multiple principals generates a “common agency”. We show that the optimal bureaucratic structure depends on the existence of rents from office: the two systems produce equally welfare-efficient outcomes if there are no rents, a singleprincipal model dominates common agency otherwise.
Keywords: principal-agent, bureaucracy, incentives, public goods.
Contents
- The prerequisites of social development when planning for decentralization
Cătălin Daniel DUMITRICĂ
Teodora I. BIŢOIU
Dragoş DINCĂ
- Testing the validity of the Feldstein-Horioka Puzzle:
New evidence from structural breaks for Turkey
Ekrem ERDEM
Ahmet KOSEOGLU
Ali Gokhan YUCEL
- The role of institutional pressures in developing countries. Implications for IFRS
Cătălina Florentina PRICOPE
- Children’s health insurance coverage in the United States:
The role of parents’ ethnicity and immigration status
Swarn CHATTERJEE
- An empirical investigation of banking sector development
and economic growth in a panel of selected SAARC countries
Javed AHMED
Malik Fahim BASHIR
- A common agency within bureaucracy
Nadide Banu OLCAY
- From public services to networks of social enterprises.
Strategic trends for South-Eastern Europe
Ani MATEI
Carmen SĂVULESCU
Corina-Georgiana ANTONOVICI
- The relationship between inclusive growth,
inequality and poverty in Africa
Mohamed BEN AMAR
Nahed ZGHIDI
- Bankruptcy prediction based on the debt ratio
Daniel BRÎNDESCU-OLARIU
- The effects of saving-investment gap
on economic growth in developing countries:
A clustering and panel data analysis
Ismet GOCER
Tugba AKIN
Sedat ALATAS
- Impact of educational expenditure on economic growth
in major Asian countries: Evidence from econometric analysis
Lingaraj MALLICK
Pradeep Kumar DAS
Kalandi Charan PRADHAN
- Developing a financial inclusion index
and inclusive growth in India
Susanta Kumar SETHY
- Examining the determinants of FDI inflows in India
Shiba Shankar PATTAYAT
- A review of corruption based on the social and economic
evolution of Ancient Greece and Ancient Rome
Ciprian ROTARU
Dumitru-Alexandru BOD
Raluca GEORGESCU
- Estimating the exchange rate in the context of Romania's
integration in the Eurozone
Laura Mădălina PÎRŞCOVEANU