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Influencing the public and efficiency in bureaucratic provision

journal contribution
posted on 01.05.2009, 00:00 authored by Samarth VaidyaSamarth Vaidya
In the present paper a public bureau can extract additional budgetary allocations, not only by misreporting its production cost to its oversight committee but also by 'influencing' the perceptions of the public at large. I juxtapose the bureau's ability to influence the public with its ability to misreport to the oversight committee, and find that influencing the public might support an efficient level of production by invoking a separating equilibrium. However, a pooling equilibrium involving either overproduction or underproduction of output cannot be ruled out. Accordingly, overproduction could occur even when the bureau cares only about extracting excess budget and not increasing output per se.

History

Journal

Pacific economic review

Volume

14

Issue

2

Pagination

259 - 274

Publisher

Blackwell

Location

Oxford, England

ISSN

1361-374X

eISSN

1468-0106

Language

eng

Publication classification

C1 Refereed article in a scholarly journal; C Journal article

Copyright notice

2009, Blackwell