000			01174pab a2200157 454500
008			180718b1994 xxu||||| |||| 00| 0 eng d
100			_aCarlsen, Fredrik
245			_aAsymetric information, reputation building, and bureaucratic inefficiency
260			_c1994
300			_ap.350-57
520			_aThe paper shows that asymmetric information about preferences is a possible source of bureaucratic inefficiency. The analysis is based on an application of the reputation model of Kreps and Wilson to a bureaucracy model in the Niskanen tradition. We consider a public bureau which is funded by a government sponsor. If the bureau has incomplete information about the sponsor's opportunity cost of funds and the sponsor does not know the bureau's aversion to effort, both agents may choose to engage in reputation manipulation in order to induce the opponent to contribute more to the production of public services. We show the existence of a perfect Bayesian equilibrium where cost and allocation inefficiency may p revail for a considerable period of time. - Reproduced
650			_aCivil service
650			_aBureaucracy
773			_aPublic Finance
909			_a31561
999			_c31561 _d31561