Bureaucracy Norms and Market Size
AbstractThis paper proposes a new model of market structure determination. It demonstrates that market structure need not be the result of ideology, political power, collusion among producers or the nature of the technology. In our setting, it is determined by bureaucrats who maximize their share of the industry profits. The approach is illustrated by studying the relationship between industry size and the existing institutional norm and by identifying the bureaucrats' most preferred norm. In the latter context, we establish the fundamental inverse relationship between the costs of interaction with government officials and industry size.
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Bibliographic InfoPaper provided by Institute for Advanced Studies in its series Economics Series with number 259.
Length: 25 pages
Date of creation: Nov 2010
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Find related papers by JEL classification:
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-11-13 (All new papers)
- NEP-CDM-2010-11-13 (Collective Decision-Making)
- NEP-CIS-2010-11-13 (Confederation of Independent States)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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