A bureaucrat and bureaucrat’s role in setting the economic policy

A bureaucrat is a constituent of a bureaucracy. Bureaucracy is usually means governments but can also refer to specific organizations. As an example, a large private organization is also a bureaucracy and an individual working for such an entity is a bureaucrat.

Bureaucrat, as a word, originated from the French word bureau, which means “desk”. This name was selected because bureaucrats are seen as individuals who work behind the desk.

However, here we are concerned with a bureaucrat who is an employee of the government and an economic policy decision-making participant.

A bureaucrat is an agent of a political leader (principal) and he or she implements policy choices of politicians. One of the big differences between a politician and a bureaucrat is that the latter is appointed and the former is elected. Some bureaucrats are technocrats. Technocrats are professionals, such as economists and engineers, who advise politicians on the areas of their expertise. For example, economists may advise on economic policy choices.

Bureaucrats are often driven by motives other than being a faithful servant (agent) of politicians (principals). A bureaucrat is a human being with his or her own agendas, desires and ambitions. Along with meritorious motives, he or she may be driven to maximize income, status and power or to advance his or her career.

In the economic theory, it is assumed that a bureaucrat is driven to maximize his or her budget. This occurs because the bigger the budget that a bureaucrat controls, the bigger the perceived power and the status and, thus, satisfaction of a bureaucrat.

Therefore, bureaucrats have an incentive to arrange for a budget which is above the optimal (most effective) budget level and this leads to excessive spending by government. In the pursuit of enlarging the budget, a bureaucrat may exaggerate benefits and downplay costs and threats.

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