Bureaucracy and the economic organization of political enterprise

Abstract

Traditional public choice models inject instability into equilibrium models through the instability of majority coalitions. This chapter incorporates that source of instability into a system of entanglement among political and commercial enterprises. What results is recognition that social systems exhibit features that resemble plate tectonics due to clashing between the institutional frameworks of private ordering and public ordering. The ambit of theories of bureaucracy and political enterprise is the creation and conduct of organizations that do not operate directly through the system of residual claimancy and profit-and-loss. This chapter gives particular attention to Tullock's (1967) theorizing about bureaucracy both because it is less-widely used by public choice theorists and because it meshes more directly with ideas of entanglement within political economy. Furthermore, the strength of such tectonics is likely to expand with expansions in public relative to private ordering within society.