Bureaucratic Compliance as a Game on the Unit Square

Abstract

Already a fairly large body of literature has developed using Niskanen's theory as a starting point, showing how changes in Niskanen's assumptions can lead to a more realistic, yet still rigorous theory of bureaucratic behavior. This paper will review some of the more important elaborations of Niskanen’s theory to date and suggest a still more fundamental alteration of the assumption set. Basically, this paper will argue that the bureau head's supply decision cannot be regarded as an isolated decision, constrained by a fixed budget-output schedule. Rather, the bureau head's supply decision and the sponsor's budget appropriation decision must be analyzed in strategic interaction. This perspective suggests a game-theoretic model and permits the analyst to ask questions about the uniqueness and efficiency of joint solutions that are difficult or impossible to investigate with simpler models.