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The Politics of Bureaucracy

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The Politics of Bureaucracy is an underrated and wrongly ignored classic. Most of the modern literature on bureaucracies focuses on "principal-agent problems". According to Tullock an authority faces two problems with their subordinates "communicating his desires and seeing that these are carried out". The latter of these problems is the principal-agent problem. The former is the central focus of this book.

Modern social democratic states function through large centralized bureaucracies. The communication problems of such organizations are immense, but the solution to this problem is simple and fairly obvious. Many modern functions of government should be shifted from the Federal level to the local level. Switzerland serves as a good example of how government should work (see also Eleanor Ostrom's "Governing the Commons"). We should avoid highly centralized welfare/regulatory bureaucracies, such as those that exist in Sweden, France, Germany, and to a lesser extent the United States.

I was lucky enough to read this book as part of a class taught by Tullock himself. While few others can learn about the information problems of bureaucracy this way, anyone can read this book on their own (there is a recent reprint). The Politics of Bureaucracy should be required reading for political science students. This book also goes well with "Bureaucracy" by Ludwig von Mises and "The Road to Serfdom" by FA Hayek. Together, these three books hit at the core of the problems with public organizations. Unfortunately, these three books get little attention from Economists and even less from Political Scientists. One can only hope that there will be a resurgence of interest in great book.