Political appointees vs. career civil servants: A multiple principals theory of political bureaucracies

Abstract

This paper analyzes a multiperiod delegation model with two principals and an agent. The purpose of the model is to explore the determinants of civil service structure, in particular, the use of political appointees (short lived agents) vs. civil servants (long lived agents). We see this process as a bargaining problem between two principals, Congress, a long lived principal, and the President, a short lived one. Our model is consistent with three aspects of the U.S. Civil Service: its evolution during this century, the high proportion of political appointees in the higher civil service with respect to its counterparts in occidental democracies with parliamentary systems, and the different scope of civil service coverage in local governments in the United States. We argue that these differences in the organization of civil services across countries and over time can be understood as the result of a game among multiple principals for the control of the bureaucracy, with the main determinants being the extent by which the legislative and executive bodies are aligned in their interests, who is politically more powerful, whether they have different political horizons, and to what extent political parties control their representatives at both the executive and legislative bodies. We model this interaction by letting the principals have different horizons. One principal lives through the entire game and faces a series of short lived principals. The emphasis of the model is on the choice of the agent, who can be either short or long lived. We analyze the optimal agent type from the perspective of each of the principals. Since a longer horizon agent can be better controlled by the long lived principal, the latter will prefer a long lived agent. The short lived principals, on the other hand, may prefer short or long lived agents. We show that if the two types of principals have opposed preferences in relation to the outcome of the agent's action, then the short lived principals will prefer a short lived agent. Otherwise, the short lived principal alive in the first period will also prefer long lived agents.