Bureaucracy, Its Reform and Development

Abstract

Few aspects of economic policy elicit more conflicting opinions than the role of bureaucracy in policy making and implementation. These range from Max Weber’s picture of a rule-governed efficient institution to the ‘Yes, Minister’ caricature of one bound in complex red tape, operating inefficiently and serving the interests of its own officials. In this article, I attempt a better understanding guided by the economics of incentives and organisations. I emphasise the multidimensional complexity of government bureaucracies—they are answerable to multiple political principals, must handle multiple tasks, have multiple levels of hierarchy and so on—and suggest some institutional and organisational reforms that seem relevant for India and other less-developed countries that wish to sustain growth and progress to and beyond a middle-income level.