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Gridlock and Delegation in a Changing World

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  • Callander, Steven

    (Stanford University)

  • Kreibiel, Keith

    (Stanford University)

Abstract

Fixed statutes and regulations often have variable consequences over time. If left unattended, such drift can severely erode the performance of government as an institution of representation. To better understand the mechanics of policy-making in a changing world, we develop a positive theory that captures political drift in a dynamic, separation-of-powers system. We show analytically that a distinctive combination of legislative supermajoritarianism and agency autonomy institutional features that, in isolation, elicit widespread criticism--can effectively ameliorate policies' susceptibility to the vicissitudes of exogenous change. The critical mechanism for governmental accommodation of drift is delegation, which increases all decision-makers' well-being by reducing fluctuations in outcomes. Although the complete smoothing of outcomes is attainable in a separation of powers system, we show that this is typically not achieved in equilibrium. The presence of drift provides an opportunity for self-interested legislators to extract a distributional benefit from their fellow legislators at the expense of overall policymaking efficiency.

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Bibliographic Info

Paper provided by Stanford University, Graduate School of Business in its series Research Papers with number 2100.

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Date of creation: Mar 2012
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Handle: RePEc:ecl:stabus:2100

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  1. Alonso, Ricardo & Matouschek, Niko, 2005. "Optimal Delegation," CEPR Discussion Papers 5289, C.E.P.R. Discussion Papers.
  2. Josep M. Colomer, 2005. "Policy making in divided government. A pivotal actors model with party discipline," Economics Working Papers 817, Department of Economics and Business, Universitat Pompeu Fabra.
  3. Gilligan, Thomas W & Krehbiel, Keith, 1987. "Collective Decisionmaking and Standing Committees: An Informational Rationale for Restrictive Amendment Procedures," Journal of Law, Economics and Organization, Oxford University Press, vol. 3(2), pages 287-335, Fall.
  4. Callander, Steven, 2008. "A Theory of Policy Expertise," International Quarterly Journal of Political Science, now publishers, vol. 3(2), pages 123-140, July.
  5. Thomas Romer & Howard Rosenthal, 1978. "Political resource allocation, controlled agendas, and the status quo," Public Choice, Springer, vol. 33(4), pages 27-43, December.
  6. Martin, Elizabeth M, 1997. "An Informational Theory of the Legislative Veto," Journal of Law, Economics and Organization, Oxford University Press, vol. 13(2), pages 319-43, October.
  7. Sean Gailmard, 2002. "Expertise, Subversion, and Bureaucratic Discretion," Journal of Law, Economics and Organization, Oxford University Press, vol. 18(2), pages 536-555, October.
  8. James Rogers, 2005. "The Impact of Divided Government on Legislative Production," Public Choice, Springer, vol. 123(1), pages 217-233, April.
  9. George J. Stigler, 1971. "The Theory of Economic Regulation," Bell Journal of Economics, The RAND Corporation, vol. 2(1), pages 3-21, Spring.
  10. Moe, Terry M, 1990. "Political Institutions: The Neglected Side of the Story," Journal of Law, Economics and Organization, Oxford University Press, vol. 6(0), pages 213-53.
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