Elites, Institutions and the Quality of Government

Carl Dahlström, Lena Wängnerud, Carl Dahlström, Lena Wängnerud

• Publisher: Palgrave Macmillan
• Year: 2015
• Print ISBN: 9781349559459, 9781137556271
• eBook ISBN: 9781137556288
• Topic: Politics & International Relations
• Subtopic: Politics
• Index: Politics & International Relations

To a large extent, elite politicians, bureaucrats, and businessmen hold the fortunes of their societies in their hands. This edited volume describes how formal and informal institutions affect elite behaviour, which in turn affects corruption and the quality of government.

Section III

Power-Sharing

9

Democratic and Professional Accountability

Carl Dahlström and Victor Lapuente

Democratic accountability is often seen as an essential institutional underpinning for the prosperity of nations. Democracies with well-established mechanisms of electoral accountability provide more secure property rights (Clague et al., 1997), implement policies with a higher economic rate of return (Isham et al., 1997) and perform better in areas such as rule of law, bureaucratic quality and school enrolment, as well as provide minimal levels of corruption (Keefer, 2007). These dividends of democracy probably help us understand why it is also claimed that “democracy does cause growth” (Acemoglu et al., 2014, p. 1).

In terms of policy prescriptions, this body of research has strengthened what Paris (2004, p. 6) calls Wilsonianism, coined after the 28th US President Woodrow Wilson, which is the idea that democracy will bring prosperity because it promotes, as Wilson wrote, the “ascendancy of reason over passion.” Consequently, “the democracy-promotion perspective has become increasingly popular, championed by commentators such as Thomas Carothers, Larry Diamond, Morton Halperin, Michael McFaul, Joseph Siegle, and Michael Weinstein, among others” (Norris, 2012, p. 3).

Standing in sharp contrast to the tenets of Wilsonianism, many governance scholars instead claim that the key institutional ingredient is what is often called a Weberian bureaucracy, after sociologist Max Weber’s work on bureaucracy. Propelled by empirical studies on developmental states (Wade, 1990; Evans, 1995), as well as by theoretical discussions of the importance of bureaucracies (Olsen, 2008), studies have shown that Weberian bureaucracies lead to a higher quality of government (Rauch and Evans, 2000; Dahlström et al., 2012) and, in turn, to other socio-economic benefits such as reduction of poverty and higher growth rates (Evans and Rauch, 1999; Henderson et al., 2007). In essence, this scholarship contends that bureaucracy trumps out democracy in explaining cross-national differences. According to this line of argument, the reason why public funds are misused in some countries, while other countries provide welfare-enhancing policies, is related more to how administrative officials are selected than to how political officials are selected. Rothstein (2011) compares Singapore and Jamaica, for instance, two post-colonial countries that gained independence at almost the same time and were expected to perform alike, and notes that, while the former achieved astonishingly high levels of good governance under authoritarian rule, the latter performed much worse under a more democratic regime. From a Weberian perspective, it is not electoral accountability but a professional bureaucracy formed by meritocratically recruited and promoted public employees that is essential for the dominance of reason over passion (Olsen, 2008).

Consequently, in terms of policy prescriptions, “diverse commentators such as Simon Chesterman, James Fearon, Francis Fukuyama, Samuel Huntington, Stephen Krasner, David Laitin, and Roland Paris have all advocated state-building” (Norris, 2012, p. 4). Supporters of this strategy acknowledge democracy as a desirable goal in itself but recognize the pragmatic gains of strengthening governance institutions before the introduction of electoral democracy (ibid.; Paris, 2004). This prescription is of the utmost importance in post-conflict countries, such as Afghanistan, where what is required is “not democracy promotion . . . It’s state building” (Berman, 2010), or rebel-controlled Syria, where efforts of the international community should be devoted not so much to the political class but to “training civil servants and supporting projects that broaden institutional capacity” (Martin, 2014, p. 35).

In sum, while many authors champion democracy “as the antidote to everything from corruption to poverty,” others follow the 2002 United Nations Human Development Report’s warning that “the links between democracy and human development are not automatic” (Holmberg et al., 2012, p. 278). The theoretical predictions and the policy implications of Wilsonianism and Weberianism are thus opposite: maximizing the democratic accountability of political officials or supporting professional bureaucracies.

This chapter aims to reconcile these two views by arguing that both democracy and bureaucracy are necessary to attain a high quality of government. The argument is simply that good governance will be achieved in policies that combine democratically accountable political officials with bureaucrats who are accountable to their professional peers. The reason is that while both democratically elected leaders and autonomous bureaucrats might be tempted to enrich themselves and their constituencies or corps, this can be minimized if they are checked by each other so that politicians are the guardians of bureaucrats and vice versa. If this is correct, it could be observable in how well corruption is controlled in the country. Where rulers are democratically accountable and at the same time administrators are accountable to their professional peers, corruption levels should be lower. The chapter’s main goal is to test this proposition in a broad set of countries.

The remainder of the chapter is organized as follows. The section below deploys arguments as to why an interaction between the democratic accountability of politicians and professional accountability of bureaucrats minimizes opportunities for rent-seeking. The arguments are illustrated with examples of the dangers of both an autonomous bureaucracy without democratically accountable rulers and a democracy unconstrained by a powerful body or meritocratically recruited bureaucrats, and thus examples of why they need each other. Subsequent sections introduce the data and methods and proceed to show cross-sectional analyses with a sample of over 100 countries, where we subject the impact of the democracy–bureaucracy interaction of our hypothesis to diverse controls. Results show that countries combining a merit-based, instead of politicized, administrative workforce, together with democratically accountable political incumbents have lower levels of corruption. The final section sums up and concludes that it is probably not a question of Wilsonianism or Weberianism; both are needed.

Why we need both democracy and bureaucracy to prevent rent-seeking

This chapter explores cross-country differences in corruption and understands corruption as the misuse of public office for private gains (Shleifer and Vishny, 1993; Rose-Ackerman, 2008). Corruption is a central feature of quality of government, according to numerous scholars. The huge variation in ability to curb corruption is essential to an understanding of the widely divergent national performances in a myriad of outcomes, from economic growth (Nye, 1967; Mauro, 1995; Mo, 2001) to inequality (Li et al., 2000; Gupta et al., 2002) and human development (Kaufmann, 2004; Akcay, 2006).

A very brief look at the political history of the world allows us to see the inextricable link between public goods and opportunities for corruption and abuse of political office. Miller (2000, p. 289) observes this paradox and notes how states, on the one hand, produce public goods required to sustain and promote socio-economic development, while they, on the other hand, have a structure in which the individuals ruling those states are tempted to appropriate the unavoidable “surplus benefits generated by the creation of those goods.” This “conflict between the self-interest of ruler(s) and overall social efficiency is one of the more inclusive and compelling generalizations to be made” (Miller and Hammond, 1994, p. 6). Consequently, the story of the development of state apparatuses has a counter story: one of rulers taking advantage of their positions to enrich themselves and their clique at the expense of social welfare. Fukuyama’s (2011) The Origins of Political Order offers numerous instances of how, throughout the history of humankind, ruling elites—from the Chinese imperial state and the Ottoman system to European monarchies—have tended to pursue their interests whenever they have been left unchecked.

As noted in the introduction, while some have put their hope to democracy and others to the bureaucracy, the argument here is that both are needed. To explain why, we start by discussing how a bureaucracy accountable to professional peers instead of directly to the rulers contributes to low levels of corruption, and we also explain why this is probably not sufficient. According to Fukuyama (2011), historical experience reveals that many polities tried to mitigate rent-seeking following early Chinese state builders, who pioneered mechanisms to select officials on a meritocratic basis. In Above Politics (2000), Miller generalizes this historical regularity into a compelling theoretical argument: by delegating the management of the state apparatus to merit-based autonomous bureaucrats, a barrier is created between those tempted by opportunistic actions in the delivery of public goods (i.e. politicians) and those effectively providing them (i.e. bureaucrats). The solution would thus be to “insulate bureaucrats from efficiency-undermining political pressures” (ibid., p. 289).

Much evidence indeed points in this direction; creating administrative bodies that are not directly responsive to their political superiors but enjoy a merit-based self-management seems to yield beneficial effects in terms of reducing widespread corrupti...

Table of contents

• Cover Page
• Title Page
• Copyright
• Contents
• List of Illustrations
• Preface and Acknowledgments
• Notes on Contributors
• List of Abbreviations
• Section I: Introduction
• Section II: History and State-Building
• Section III: Power-Sharing
• Section IV: Political Parties
• Index