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Citizens' Information and the Size of Bureaucracy

Author

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  • Maria Alessandra Antonelli

    (Institute of Economics and Finance, “La Sapienza” University of Rome, Italy)

Abstract

This paper analyzes, in a traditional public choice perspective, the political-bureaucratic relationship starting from the idea that citizens' information is a random variable whose distribution can change because of institutional elements. As in Niskanen's model, we assume that political preferences represent citizens’ preferences, but unlike the traditional theory we consider a stochastic political demand function whose variables are the quantity of the public good and a random variable representing the available citizens' information on the public good. Additionally, political competition as well as mass media competition can affect the distribution of the information. Using the Rothschild and Stiglitz (1970) theory, we show that the size of bureaucratic activity decreases as the dispersion of information among citizens increases, thus improving the efficiency of the system.

Suggested Citation

  • Maria Alessandra Antonelli, 2009. "Citizens' Information and the Size of Bureaucracy," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 9(1), pages 17-26.
  • Handle: RePEc:pet:annals:v:9:i:1:y:2009:p:17-26
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    File URL: http://upet.ro/annals/economics/pdf/2009/20090102.pdf
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    References listed on IDEAS

    as
    1. Aghion, Philippe & Tirole, Jean, 1997. "Formal and Real Authority in Organizations," Journal of Political Economy, University of Chicago Press, vol. 105(1), pages 1-29, February.
    2. Bordignon, Massimo & Minelli, Enrico, 2001. "Rules transparency and political accountability," Journal of Public Economics, Elsevier, vol. 80(1), pages 73-98, April.
    3. Varian, Hal R, 1985. " Divergence of Opinion in Complete Markets: A Note," Journal of Finance, American Finance Association, vol. 40(1), pages 309-317, March.
    4. Tirole, Jean, 1986. "Hierarchies and Bureaucracies: On the Role of Collusion in Organizations," Journal of Law, Economics, and Organization, Oxford University Press, vol. 2(2), pages 181-214, Fall.
    5. Bendor, Jonathan, 1988. "Formal Models of Bureaucracy," British Journal of Political Science, Cambridge University Press, vol. 18(03), pages 353-395, July.
    6. Martimort, David, 1996. "The multiprincipal nature of government," European Economic Review, Elsevier, vol. 40(3-5), pages 673-685, April.
    7. repec:cup:apsrev:v:79:y:1985:i:04:p:1041-1060_23 is not listed on IDEAS
    8. Rothschild, Michael & Stiglitz, Joseph E., 1970. "Increasing risk: I. A definition," Journal of Economic Theory, Elsevier, vol. 2(3), pages 225-243, September.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    bureaucracy; information; public organizations;

    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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