TY - JOUR

T1 - Discovering the Dark Side of Power

T2 - The Principal’s Moral Hazard in Political-Bureaucratic Relations

AU - Döhler, Marian

N1 - © 2016 Taylor & Francis Group, LLC

PY - 2018/2/17

Y1 - 2018/2/17

N2 - Principal agent (PA) is among the most prominent concepts for analyzing the relationship between politics and bureaucracy. Nonethelesss, the inherent bias of PA scholars to attribute moral hazard almost exclusively to the agent, usually referred to as “bureaucratic drift”, requires re-examination. Building on the spare literature in which moral hazard of the principal is considered, this paper provides empirical evidence for a neglected aspect of the PA concept. Three cases of German regulatory agencies responsible for drug control, financial services and rail safety are analyzed in critical situations which were largely perceived as bureaucratic failures. The analysis reveals that a good deal of these failures, ranging from negligence to suppressing crucial information, has to be attributed to the political principal. This is called the dark side of power because the intention is to shift blame or to dodge political responsibility. Turning conventional PA reasoning upside down, the conclusion is that the principal’s moral hazard should be considered more routinely as a potential explanation for political-bureaucratic interactions.

AB - Principal agent (PA) is among the most prominent concepts for analyzing the relationship between politics and bureaucracy. Nonethelesss, the inherent bias of PA scholars to attribute moral hazard almost exclusively to the agent, usually referred to as “bureaucratic drift”, requires re-examination. Building on the spare literature in which moral hazard of the principal is considered, this paper provides empirical evidence for a neglected aspect of the PA concept. Three cases of German regulatory agencies responsible for drug control, financial services and rail safety are analyzed in critical situations which were largely perceived as bureaucratic failures. The analysis reveals that a good deal of these failures, ranging from negligence to suppressing crucial information, has to be attributed to the political principal. This is called the dark side of power because the intention is to shift blame or to dodge political responsibility. Turning conventional PA reasoning upside down, the conclusion is that the principal’s moral hazard should be considered more routinely as a potential explanation for political-bureaucratic interactions.

KW - Moral hazard

KW - Politics and bureaucracy

KW - Principal agent

KW - Regulatory agencies

UR - http://www.scopus.com/inward/record.url?scp=85006314652&partnerID=8YFLogxK

U2 - 10.1080/01900692.2016.1256893

DO - 10.1080/01900692.2016.1256893

M3 - Article

AN - SCOPUS:85006314652

VL - 41

SP - 190

EP - 202

JO - International Journal of Public Administration

JF - International Journal of Public Administration

SN - 0190-0692

IS - 3

ER -