The evolution of federal employment

Abstract

The first federal employees (other than Founding Fathers) were clerks. As federal employment grew in the 1820s, its ranks came to be dominated by patronage workers. After the Civil War, bureaucrats slowly displaced patronage workers at the federal level. Now, federal employments are being privatized and the bureaucracy shrunk. I explain this evolution of federal employment with one simple model of politics in a changing environment. Politicians combine into political firms to promise benefits to subsets of voters in return for election. If elected, politicians provide the benefits as efficiently as possible. Thus, politicians choose the form and size of their political firms to maximize expected political profits. Environmental changes affect the choices. The breach of the Appalachians in the 1810s, defeat of the South in the Civil War and the simultaneous rise of big and transcontinental industry, and contemporary worldwide economic inte-gration (globalization) are three environmental changes that changed the efficient organization of federal political firms.