American Economic Review: Vol. 97 No. 1 (March 2007)
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The Motivation and Bias of Bureaucrats
Prendergast, Canice. 2007. "The Motivation and Bias of Bureaucrats." American Economic Review, 97(1): 180-196.
Many individuals are motivated to exert effort because they care about their jobs, rather than because there are monetary consequences to their actions. The intrinsic motivation of bureaucrats is the focus of this paper, and three primary results are shown. First, bureaucrats should be biased. Second, sometimes this bias takes the form of advocating for their clients more than would their principal, while in other cases, they are more hostile to their interests. For a range of bureaucracies, those who are biased against clients lead to more efficient outcomes. Third, self-selection need not produce the desired bias. Instead, selection to bureaucracies is likely to be bifurcated, in the sense that it becomes composed of those who are most preferred by the principal, and those who are least preferred. (JEL D64, D73, D82)
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