The new primary school was built on a hill, a short walk from the homes and shops of a village located in a southern district in Ghana. The freshly painted yellow walls shone in the sunlight. Parents were excited when the local government hired contractors to begin work on the classrooms because the old school was dark, stuffy, and overcrowded. However, despite their glossy exterior, the new buildings turned out to be little more than fools’ gold. Ill-fitting window shutters flapped in the wind; wild animals had gotten in and littered on the floors. Wires hung precariously from uncovered electricity sockets, ready to snap at curious young hands. The ceilings bowed and bulged. The classrooms had been padlocked shut, unused, since they had been painted.
The school was yet another “failed” development project on the local government’s list. The district’s internal auditor was frustrated by the abandoned school and similar projects that were poorly constructed, never finished or existed only on paper. Ghana is not a wealthy country by global standards. Most people earn less than $200 per month, or about $6 a day.Footnote 1 Local governments have significant developmental mandates; they are expected to construct and maintain local public infrastructure on limited budgets.Footnote 2 Given the high public demand for better infrastructure and scarce public resources, it is frustrating (and puzzling) when such funds are wasted.
Yet two-thirds of local government infrastructure projects are successfully completed.Footnote 3 About half of the high-ranking local bureaucrats I surveyed for this book believed that local officials engaged in corruption; yet the other half did not. Overall, Ghana’s public sector features multiple pockets of excellence.Footnote 4 Indeed, prior work establishes that there are often more within-country differences in the performance of public sector units than there are across countries.Footnote 5
This book investigates how, why, and when states deliver public services efficiently. Many existing theories of governance and development fail to explain this internal variation. For example, macrostructural factors such as a country’s colonial heritage, institutionalization of property rights, level of democracy, or electoral system cannot account for the internal variation in governance outcomes in low- and middle-income countries.Footnote 6 An adequate theory of governance must be flexible enough to explain variation in performance across public sector units (local governments, departments, and agencies).
Theories that highlight state capacity as the central driver of or impediment to public sector effectiveness are also inadequate.Footnote 7 While state capacity can vary across units,Footnote 8 and thus may explain internal variation, poor governance outcomes are often not the result of insufficient personnel, a lack of bureaucratic knowledge, or inadequate financial resources. For instance, the school project I describe was fully funded and administered by well-educated, highly trained, and extremely competent local bureaucrats. If insufficient capacity was not the reason for the project’s failure, what was?
While the availability of resources can no doubt influence governance outcomes,Footnote 9 in this book I argue that many governance failures are the result of the sub-optimal organization of relations between politicians and bureaucrats. A deeper awareness of politicians’ incentives, and their levers of control over bureaucrats’ careers, is therefore essential to understanding when the state is able to deliver effectively. I concentrate on bureaucratic management, rather than bureaucratic selection and resources, as the primary driver of public sector performance. My theory emphasizes the importance of considering politicians’ electoral strategies and incentives when theorizing public sector outcomes. My theory assumes that politicians gain voters’ support by distributing goods to them using either a rule-based (programmatic) or discretionary (non-programmatic) approach.Footnote 10 Prior work has established that the latter is a primary determinant of voter–politician linkages in many developing democracies.Footnote 11 Politicians who rely on non-programmatic practices face a dilemma in how to treat the public sector. On the one hand, they have an incentive to invest in bureaucratic competence to facilitate the efficient delivery of goods, especially programmatic benefits.Footnote 12 On the other hand, they may be discouraged from investing in competence, as this typically reduces bureaucratic loyalty.Footnote 13 Most importantly, decreased loyalty makes it harder for politicians to engage in non-programmatic distribution because the discretionary allocation of goods often entails politicians asking bureaucrats to bend or break formal rules; at its worst, it can involve asking bureaucrats to engage in corruption to capture public funds.
To overcome this dilemma and support their desire to promote administrative efficiency without compromising their ability to engage in non-programmatic (or clientelistic) distribution to win electoral support, I argue that politicians will often adopt a “middle-ground” approach to public sector professionalization. This strategy involves politicians professionalizing bureaucratic selection, yet because merit-based practices reduce loyalty, they will retain the ability to control individual bureaucrats’ careers. Politicians will use what I call career control to generate forced bureaucratic loyalty. Career control tools include political interference in bureaucrats’ (i) promotions, (ii) work portfolios, and (iii) geographic or departmental transfers. These tools are powerful because they affect bureaucrats’ professional advancement and can negatively affect their personal lives and well-being. Politicians can leverage these tools to co-opt the state.
Variation in politicians’ opportunities and motivation to use career control tools can explain disparities in governance across public sector units. Politicians’ opportunities to employ such tools are typically not evenly distributed. For example, those with strong ties to elites may be better able to transfer or block a bureaucrat’s promotion. I propose that politicians are more motivated to co-opt bureaucrats where they most desire to engage in non-programmatic distribution – often where local electoral competition is high. Local electoral competition encourages clientelism and drives up the cost of election campaigns.Footnote 14 It therefore encourages politicians to use career control tools to co-opt bureaucrats, which undermines good governance practices.
Applying this theory to the opening vignette, the school project failed because the local government awarded the contract to a political insider rather than engaging in a competitive process. The mayor had an incentive to control procurement outcomes to fund local party campaign activities to support the incumbent president, so he contracted with a firm that was willing to channel a share of the project’s budget into the incumbent party’s campaign chest. As I discuss in this book, electoral politics often incentivize politicians to find nefarious ways to finance election campaigns, and they frequently turn to public procurement.Footnote 15
However, electoral pressures on politicians are only half of the story. In the southern district of Ghana that I referred to at the start of this chapter, I asked the internal auditor why, as a professionally trained and meritocratically recruited bureaucrat whose salary is funded by the public purse, he did not push back against or expose such practices. More broadly, why do bureaucrats condone corrupt behavior from which they personally gain little? After all, Ghana’s Whistleblower Act (Act 720) of 2006 protects bureaucrats who expose corrupt practices. The auditor explained that attempts to block or expose bad governance practices could severely jeopardize a bureaucrat’s career. Well-connected politicians can transfer them to faraway locations or make their work lives a misery.Footnote 16 Thus, the mayor of this district engaged in informal management practices to co-opt the state.
1.1 Key Concepts and Empirical Focus of the Book
This book accepts the positive role that states have played (and continue to play) in promoting progress,Footnote 17 and focuses on the state’s role in development. I define governance as “a government’s ability to make and enforce rules, and to deliver services.”Footnote 18 Regarding service delivery, I focus on the state’s ability to provide safe and effective public infrastructure – an essential government task. Most low- and middle-income countries, particularly those in Africa, have insufficient infrastructure to support economic growth and human development.Footnote 19 In this book, I follow prior work that defines meritocratic recruitment as a system in which “individual merits – such as education, knowledge, skills and job-related experience 
constitute the main grounds for hiring to bureaucratic positions.”Footnote 20
In Ghana, as the book’s opening vignette highlights, planning and constructing (or repairing) public works is the primary task of local governments. The book’s empirical chapters focus on two aspects of infrastructure provision: (i) the siting of new projects within districts and (ii) public procurement (contracting private firms to construct these projects). Examining these processes highlights how local development is the product of a series of administrative processes. I explain why meritocratically hired bureaucrats help politicians facilitate bad governance practices and why such practices vary across districts.
A focus on public procurement is warranted as it accounts for 10–25 percent of public spending globally.Footnote 21 It is often a country’s largest source of private spendingFootnote 22: it constitutes about 14% of GDP (and 50% of government spending) in African countries.Footnote 23
Malfeasance in procurement, particularly in infrastructure projects, is a common problem in many countries. Corruption consumes an estimated 10–30 percent of the cost of capital investment projects around the world.Footnote 24 For example, a 2011 study found that 58 percent of municipal governments in Brazil engaged in illegal public procurement.Footnote 25 In Nigeria, 38 percent of publicly funded projects that exist on paper are never started.Footnote 26 Yet corruption in public procurement is not exclusive to developing countries, and large international firms are also implicated in public scandals.Footnote 27 Further, Organisation for Economic Co-operation and Development (OECD) data reveal that 57 percent of foreign bribery cases resolved between 1999 and 2013 involved public procurement.Footnote 28
My focus on the state puts politicians (ministers, Members of Parliament [MPs], and local mayors) and bureaucrats – the public officials responsible for delivering development – at the center of the analysis. The politicians I focus on when discussing the book’s main case – Ghana – are mayors (known locally as District (Metropolitan or Municipal) Chief Executives), who head the local governments.Footnote 29
Over 80 percent of countries have decentralized at least some aspects of governance.Footnote 30 Local governments are important units because they provide local public goods and services and have close ties to citizens. In Ghana, political power is decentralized to local governments, which are formally responsible for districts’ “overall development.”Footnote 31 Fiscally, local governments largely rely on transfers from the central government. Local governments provide public infrastructure (such as local roads, schools, and health clinics) and some public services (e.g. sanitation and monitoring educational quality).Footnote 32
Citizens are much more likely to interact with local than national government officials. Nearly one-quarter of Africans (22%) have contact with their local councilors in a given year,Footnote 33 compared to 11% of citizens who contact their national representative. In Ghana, the same data indicate that close to one-third of citizens (28%) had been in contact with their local councilor in the last year, compared to 16% who had contacted their MP. Similarly, in India, while both local and national politicians spend a significant share of their time in one-to-one meetings with constituents, national politicians report spending about a fifth of their time meeting citizens compared to block councilors, who dedicate about a third of their time to such interactions.Footnote 34
I focus on bureaucrats who hold high-level administrative positions within local governments. They work in various capacities, such as budget officers, planning officers, and departmental directors, and interact regularly with their political principals – local mayors. In Ghana, all local bureaucrats are recruited centrally from the capital and are then posted to work in a particular local government. They are typically highly educated. While these bureaucrats do sometimes interact with the general public, they are not “street-level” officials in the same way that, for example, police officers or nurses are.
1.2 Existing Arguments
Before outlining my theory in more detail, I overview existing arguments that seek to account for poor governance and variation in public sector performance. I discuss arguments related to bureaucratic selection, bureaucrats’ and politicians’ incentives, and the demands of voters. My theory draws on all of this literature, and casts doubt that arguments focused on only one of these areas can sufficiently explain variation in governance.
1.2.1 Bureaucrat Selection
Two related arguments emphasize bureaucratic selection as a primary driver of low state capacity and poor governance. The first focuses on the supply of high-quality bureaucrats, while the second concentrates on the demand for these individuals.
Much prior work in this area has discussed the limited supply of well-trained potential bureaucrats as an impediment to administrative capacity, especially in African countries in the decades after independence. A well-cited anecdote is that on the eve of independence, the Belgian Congo had only six people with a university education.Footnote 35 There were too few highly trained individuals, largely because foreign officials staffed most professional positions under colonial rule. In most countries, overseas personnel held all senior roles, as well as a significant share of jobs at each level of the administrative structure except the secretarial level. Before independence, Africans held only 6% of senior posts in Kenya (and 12% of mid- and senior-level posts in Tanzania).Footnote 36 These staffing patterns led to the severe underdevelopment of local universities: most African countries did not have a single university at independence.Footnote 37
The supply challenge was exacerbated by the fact that new postcolonial leaders not only had to fill existing positions but also had to recruit new bureaucrats to expand the public sector to fulfill their developmental ambitions. The number of civil servants in African countries roughly tripled in the twenty years after independence.Footnote 38
Universities struggled to keep up with the demand for well-trained individuals. While tertiary education enrolments grew by an average of 15 percent a year between 1960 and 1980, many governments had to recruit less educated individuals.Footnote 39
Politicians also viewed public sector recruitment as an opportunity to stabilize their governments. Leaders used public sector jobs as patronage to build elite coalitions and to create patron–client networks from the center to peripheral regions.Footnote 40 In ex-anglophone colonies, public service commissions that were previously politically independent were placed under the control of the president: this was the Kenyan government’s first constitutional amendment.Footnote 41 Purposeful politicization thus undermined policymaking and policy implementation in the decades following independence.Footnote 42
Yet, supply constraints seem insufficient to account for the bad contemporary governance outcomes in many developing democracies. While only a small share of the population of African countries has a university education (see Figure 1.1), there has been a huge increase in the number (and share) of people with a bachelor’s degree on the continent.Footnote 43 Figure 1.1 displays relevant data for the four countries (Botswana, Zambia, Malawi, and Ghana) with three or more data points. The three lines in the figure represent the share of university-educated people in three categories: (i) the entire population, (ii) all bureaucrats, and (iii) high-ranking bureaucrats.
Share of high-ranking bureaucrats with a university education
Note: Bureaucrats are classified using the INDGEN variable. I code those who give their occupation as “Public administration and defense” as bureaucrats. Within this subgroup, I code high-ranking bureaucrats using the OCCISCO variable, as those who classify themselves as “Legislators, senior officials and managers” or “Professionals.”
Figure 1.1 illustrates that the share of bureaucrats with a university education has risen rapidly since 2000.Footnote 44 There has also been an explosion in the share of high-ranking bureaucrats with a university education. Table 1.1 displays the overall changes in the share of high-ranking bureaucrats with a university education for each country. All four countries for which over-time data is available have experienced an astonishing rise in the percentage of bureaucrats with a university education, ranging from an increase of 240% to 1,100% over a twenty-year period. For example, in 1990 only 3% of Zambia’s high-ranking bureaucrats were university educated, compared to nearly 40% in 2010. Ghana experienced a similar increase from 6% in 1984 to almost 40% in 2010. Increasingly, then, it seems that bureaucratic capacity or expertise is not the primary constraint on administrative performance.
| University education (%) (Baseline) | University education (%) (Endline) | Percent increase | |
|---|---|---|---|
| Botswana | 16.74 | 56.92 | 240 |
 | (1981) | (2001) |  |
| Zambia | 3.15 | 38.85 | 1,133 |
 | (1990) | (2010) |  |
| Malawi | 3.86 | 35.92 | 830 |
 | (1987) | (2008) |  |
| Ghana | 5.67 | 38.30 | 575 |
 | (1984) | (2010) |  |
These figures also suggest that the demand for educated workers has increased since democratic elections were reintroduced in many countries in the early 1990s. Theoretically, it makes sense that higher levels of democracy incentivize politicians to hire high-capacity bureaucrats. Indeed, recent empirical analysis establishes that in Indonesia, the introduction of competitive elections increased the government’s demand for high-performing bureaucrats.Footnote 45 Again, the lack of demand for well-trained bureaucrats does not fully explain poor governance.
1.2.2 Bureaucrats’ Incentives
Multiple factors shape bureaucrats’ incentives to work hard or engage in corruption or malfeasance, including how they are recruited into the public sector and their working conditions after they are hired. Indeed, poor governance is often said to result from bureaucrats’ politicized recruitment, inadequate remuneration or insufficient monitoring. Meritocratic selection procedures involve recruiting and hiring bureaucrats based on their skills, competence, and intrinsic motivation – a key component of a professional public sector. When bureaucrats are recruited based on their personal or political connections rather than merit, they may be motivated to prioritize the interests of their political patrons over the public good. Cross-national evidence supports the assumption that meritocratically hired bureaucrats perform better. States with higher levels of merit-based hiring have lower levels of corruption and are less likely to waste government resources.Footnote 46 Bureaucrats also believe that colleagues hired on the basis of merit are less corrupt and have high levels of public service motivation.Footnote 47
Globally, there is evidence of increased meritocracy in the recruitment of civil servants. The data suggest that meritocratic recruitment procedures are standard in a significant subset of low- and middle-income countries. Many countries have adopted formal examination systems to recruit personnel. The Quality of Government (QoG) Institute collects expert opinions on the condition of the public sector. Figure 1.2 displays aggregated responses from its second survey wave in 2014 and 2015 across several developing democracies.Footnote 48 The data show that countries across multiple continents, including Benin, Botswana, Brazil, Ghana, India, Indonesia, Nepal, Senegal and Uruguay, lie above the non-OECD mean on two important indicators of merit: the extent to which (i) “skills and merit” determine recruitment and (ii) formal examinations are used (1 = “hardly ever”; 7 = “almost always”).Footnote 49 The non-OECD means for these two questions are 3.64 and 4.07, respectively. Botswana and Brazil perform particularly well on the first indicator, with averages of 5.6 and 5.46, respectively, nearly two points above the overall mean. Indonesia, Benin, and India score highly on the exam indicator, with averages of 6.24, 6.00, and 6.00, respectively. These latter figures suggest that in these countries, exams are a regular part of the recruitment process. Ghana lies just above the non-OECD average on both indicators.
Meritocratic recruitment indicators in select developing democracies
Note: The dashed lines represent the non-OECD mean on this indicator for countries included in the aggregated dataset. Note that only countries with three or more expert responses are included in this dataset.
Overall, the QoG data suggests that while public sector recruitment in Ghana may not be perfectly meritocratic, merit plays an important role in recruiting at least some, and perhaps most, bureaucrats. I present additional evidence in Chapter 3 that indicates merit is a crucial factor in recruiting local high-ranking bureaucrats.
In this book, I propose that a lack of meritocracy in recruitment cannot adequately explain administrative underperformance in general – or in Ghana in particular. Indeed, local government bureaucrats are centrally recruited in Ghana, which rules out selection as a factor in explaining internal variation in governance.
Focusing instead on bureaucrats’ conditions of service after they have been hired, seminal models of administrative performance suggest that bureaucrats perform well and engage in less corruption when they receive high wages (relative to outside options) and when their actions are monitored.Footnote 50 The higher a bureaucrat’s salary, the more costly it is to risk-taking a bribe and potentially getting fired. Monitoring by public agencies or politicians increases the likelihood that corrupt acts will be detected. Empirical studies have established that high wages and higher levels of monitoring can improve performance.Footnote 51
Yet despite the attractive logic of simple economic models of bureaucrats’ incentives, prior work does not detect a consistent cross-national negative association between higher bureaucrat wages and corruption.Footnote 52 Counterintuitively, some evidence suggests that higher wages can have the opposite effect on corruption by increasing bureaucrats’ reservation price for bribes and motivating them to request larger kickbacks.Footnote 53
Perhaps more importantly, these models cannot explain a common phenomenon in developing countries – bureaucrats stealing not for themselves, but on behalf of politicians and political parties.Footnote 54 If bureaucrats are doing the politicians’ bidding, then standard models of corruption (which consider bureaucrats’ motivations in isolation from the broader political environment) are inadequate. If politicians know about, encourage, or more forcefully coerce bureaucrats into stealing on behalf of political parties, then regardless of how high their wages are, bureaucrats may be prone to engage in corruption.
Bureaucrats are more likely to bow to pressure from politicians to engage in corruption in less wealthy countries with limited private sector employment opportunities. In such contexts, bureaucrats have fewer attractive exit options if they were to leave the public sector. Overall, in contexts where bureaucrats are not fully isolated from politicians’ informal influence, theories of public sector performance cannot evaluate bureaucrats’ incentives in isolation; they must also consider the incentives of politicians and how they interact with those of bureaucrats.
1.2.3 Politicians’ Incentives
An alternative explanation for the coexistence of bureaucratic professionalization and bad governance is weak electoral institutions – specifically, insufficient political competition. High levels of national-level party competition have been shown to drive public sector reform.Footnote 55 The effect of competitive national elections operates through three main mechanisms: (i) incumbents adopting reforms to capture votes, (ii) a forceful opposition in parliament, and (iii) incumbents’ expectations of executive turnover and their fear of the future.
When competition is high enough that political parties have similar levels of popularity, incumbents may adopt meritocratic reforms to attract votes.Footnote 56 Public opinion has been found to motivate the adoption of public sector reforms in the United States: politicians in the U.S. House and Senate passed legislation on merit-based hiring partly because they feared not doing so would cost them their seats.Footnote 57 Across Latin American countries, a high level of national party competition is associated with the adoption of reforms.Footnote 58
When national elections are competitive, politicians also face strong opposition parties in parliament. Electoral competition in Eastern European parliaments stimulated administrative reforms and the development of administrative capacity after the countries’ democratic transitions.Footnote 59 Viable opposition parties dissuaded incumbents from attempting to exploit the bureaucracy, which led to the introduction of ombudsmen offices and other civil service reforms.
Finally, when national elections are competitive, politicians expect executive turnover, which incentivizes them to tie their hands in the present to prevent their opponents from using power against them in the future. In the United States, the jobs covered by the Pendleton Act (1883), which introduced competitive civil service examinations, were extended every time a president from an opposition party was elected.Footnote 60 Across states and cities, reforms to insulate the public sector have followed periods of increased partisan competition.Footnote 61
Recent theoretical work on civil service reforms suggests that the extent to which electoral competition incentivizes politicians to insulate the civil service varies depending on opposition party characteristics.Footnote 62 If the incumbent party expects to lose in a future election, because current investments in the public sector are only realized in the future, in equilibrium, incumbents will only invest in the bureaucracy today if they expect their opponent will do the same. The presence of ethnically aligned and clientelistic parties makes politicians less likely to invest in civil service reform, since incumbents will expect opponents to underinvest in the public sector and provide private goods if they win.Footnote 63 Therefore, high levels of inter-party competition may not translate into better governance in all contexts, especially where non-programmatic distribution is a core electoral strategy.
Furthermore, the competitiveness of national elections cannot explain internal variation in governance across agencies or districts within a country. Below, I argue that the positive role that national-level competition sometimes has on reform adoption may not be replicated at the local level. High levels of local electoral competition may instead incentivize politicians to increase non-programmatic distribution, and thereby undermine good governance practices by motivating politicians to interfere in administrative processes to redirect public resources.
1.2.4 Voters’ Demands
A final common explanation of poor governance entails two demand-side factors related to voters and their preferences. First, individual voters – especially poorer ones – may wish to receive private rather than public goods from politicians. Second, voters may have low expectations of what public goods politicians can provide with public budgets. In general, if politicians can win elections by providing non-programmatic (private) benefits, they have fewer incentives to invest in state capacity – and may instead prefer to hire bureaucrats who are political loyalists.
Some studies have established that citizens in developing democracies prefer individual politicians who provide universalistic or public goods,Footnote 64 and that voters reward governments that provide such goods.Footnote 65 Yet, other research has demonstrated that voters do not always reward – and sometimes appear to punish – politicians who increase the supply of public goods.Footnote 66 Politicians in many developing countries allocate substantial resources to private benefits for constituents, particularly during election campaigns.Footnote 67 This behavior appears rational because voters reward the distribution of gifts.Footnote 68
These mixed findings are compatible if we conceptualize voters as facing a collective action problem regarding their preference for programmatic distribution. A voter may prefer a politician who provides (or promises to provide) programmatic or universal benefits, but individually not want to miss out on receiving non-programmatic benefits when politicians distribute goods in this way, such as during election campaigns. Politicians face the same collective action problem: they may wish to stop providing private benefits, but risk losing to an opponent who continues to provide such goods.Footnote 69
The mixed findings regarding voters’ preferences for programmatic versus non-programmatic goods may also result from heterogeneity in distributive preferences across voters, which are shaped by their social class and degree of economic security. Wealthier citizens are more likely than poorer voters to prefer and expect politicians to provide programmatic goods.Footnote 70 Therefore, in theory, politicians may only have strong incentives to invest in administrative capacity and distribute programmatic benefits to voters when the majority of the electorate is not economically vulnerable.Footnote 71 Politicians would thus not be sufficiently incentivized to move away from non-programmatic distribution until the country becomes richer.
Politicians’ limited incentives to invest in administrative capacity may also be linked to citizens’ low expectations regarding what governing politicians can provide. Voters’ past experiences shape their future expectations and what information is available to them. They are often uninformed about how much their national and local governments have to spend, which can lower their expectations regarding state-led developmentFootnote 72 – thus giving politicians room to under-provide public goods.
Voters’ preferences and expectations are likely to be important in explaining governance outcomes. My theory recognizes that an important way in which voters’ demands shape administrative performance and corruption is by escalating the cost of election campaigns because citizens expect candidates to distribute private goods. These preferences incentivize politicians to capture rents to cover these campaign costs. This book provides insights into exactly how bureaucrats help politicians capture public funds, and why bureaucrats – even those hired based on merit – go along with party-directed corruption.
1.3 The Argument in Brief
My theory combines findings from past research on voters’ demands and politicians’ electoral strategies with insights on bureaucrats’ incentives from public administration. As discussed earlier, voter–party linkages in developing democracies are often established around non-programmatic distribution. This has implications for public sector development because the extent to which politicians rely on programmatic versus non-programmatic distribution influences the types of bureaucrats they will want to hire.
On the one hand, highly competent bureaucrats can implement programmatic policies most effectively. Such policies, by their nature, require designing and then administering policies and programs based on formal criteria. As a first step, such distribution requires capturing information from the public or from communities to ascertain their eligibility. For example, only families with an income below a certain threshold may be eligible for a cash transfer program, or a community project may only be available to disadvantaged communities. Evidence-based classification requires high levels of administrative competence. At the second step, formal eligibility must guide actual distribution. Bureaucrats selected based on merit may then be less inclined to politicize final allocation. More generally, highly competent bureaucrats will be better able to provide universalistic goods, including a stable economy, education, and healthcare services.
On the other hand, loyal bureaucrats may be most helpful to politicians who prioritize delivering non-programmatic benefits to voters because they may be better able to help politicians identify party sympathizers. It is also likely easier to convince a loyal bureaucrat than a non-loyal one to help politicians capture public funds or engage in corruption on their behalf. As discussed earlier, administrative corruption often seeks to provide politicians with funds to distribute private benefits to voters during election campaigns.
In summary, politicians focused on programmatic distribution may have incentives to adopt merit-based hiring structures and processes. Those who prioritize non-programmatic distribution will be more motivated to retain structures that reward bureaucrats’ partisan loyalty.
In practice, politicians in developing democracies typically combine programmatic and non-programmatic distribution. Democratization puts pressure on politicians to deliver universal benefits, for example, fostering economic growth and stability as well as delivering capital infrastructure, transport, education, and health services.Footnote 73 At the same time, as discussed earlier, many voters – especially less wealthy voters – may have strong expectations of private distribution. Politicians therefore mix programmatic and non-programmatic distribution in an effort to diversify their risks.Footnote 74 Domestic civil society or international donor organizations may also pressure politicians to move toward programmatic politics, and transparent bureaucratic selection and governance.
Given politicians’ goal of mixing programmatic and non-programmatic distribution, they may want to hire bureaucrats who are both competent and loyal. However, institutional structures that support merit typically make it harder for politicians to interfere to select individuals based on partisan loyalty. Further, the pool of competent partisan workers is likely to be shallower and more heterogeneous than the pool of professional appointees.Footnote 75
To solve this dilemma, I argue that politicians will recruit bureaucrats via competitive procedures that reward merit, but will retain formal or informal mechanisms through which they can control bureaucrats’ career progression. Career control tools include the ability to influence bureaucrats’ daily work tasks, determine the locations or agencies where they work, and the speed at which they can be promoted.Footnote 76 Such tools allow politicians to extract loyalty from bureaucrats when needed: bureaucrats fear being punished by politicians if they do not abide by their wishes. The control politicians exercise over bureaucrats’ careers after they have been hired is therefore a central (and often overlooked) impediment to good governance.
Career control can impose heavy costs on bureaucrats. Disrupting their career progression undermines bureaucrats’ key goals, which are often to increase their salary, their control over policy, and their professional or social status. Career control can also profoundly affect bureaucrats’ personal lives, well-being, and morale. For example, by interfering in their work portfolios, politicians may take substantively interesting work away from bureaucrats, which can make their work life unsatisfying. Similarly, discretionary and unplanned geographic transfers can separate bureaucrats from their families. Bureaucrats, particularly those in developing countries, often seek to work in specific regions of the country, either because they have personal ties to these areas or due to internal disparities in living standards. Accordingly, politicians’ threats of transfers constitute a potent tool of control.
While bureaucrats can leave the public sector if politicians interfere in their careers, their exit options are often unattractive. Well-paid jobs in the formal sector – public or private – are rare in many developing countries, especially outside of capital cities. Furthermore, while there is variation across countries, on average public servants are better paid than their private sector counterparts (what has been termed as the public sector wage premium).Footnote 77 Furthermore, where private sector salaries are higher, public workers often have perks such as free accommodation and fuel allowances. Finally, many bureaucrats value the job security of public sector positions.
I argue that the significant internal variation in governance outcomes across agencies and districts in a country can be explained by differences in politicians’ opportunities and motivation to leverage career control tools to exert influence over bureaucrats. Career control is often exercised through informal processes that require the co-operation of other politicians or bureaucrats. The position and size of an individual politician’s party or political networks determine how easily they can control bureaucrats’ careers. For example, a head politician or central-/regional-level official may need to sign off on transferring a bureaucrat to another post or agency. Politicians with close ties to such individuals will have more opportunities to employ career control tools. Since most interference will result from informal processes, politicians’ influence over bureaucrats’ careers will depend on country-specific norms and rules.
Further, I argue that politicians in certain types of districts are particularly motivated to use career control tools to engage in non-programmatic distribution. Local electoral competition increases politicians’ incentives to use career control tools. There is evidence that electoral competition encourages non-programmatic distribution as politicians compete with each other for every vote.Footnote 78 Electoral competition also boost the costs of election campaigns.Footnote 79 Where politicians seek to engage in non-programmatic distribution, they have strong incentives to interfere in administrative processes, and to use career control to extract bureaucratic loyalty.
My argument generates three important observable implications that I assess in this book. First, it implies that meritocratic recruitment is insufficient to protect against poor governance and misallocation. Second, my theory predicts a positive relationship between politicians’ opportunities to control bureaucrats’ careers and worse governance outcomes. Third, governance outcomes should be worse where politicians are motivated to control careers in order to engage in non-programmatic distribution. I argue that this will be where local elections are competitive.Footnote 80
1.4 Empirical Strategy
Studying bureaucracies in any context is challenging, largely due to the difficulties of gaining access to bureaucratic offices and the data generated within them. Scholars of American bureaucracy increasingly rely on Freedom of Information Act requests to access data, but many low- and middle-income countries either do not have such legislation or fail to answer such requests.Footnote 81 Furthermore, where corrupt governance practices are common, bureaucrats have few incentives to share data and may instead seek to hide their actions and public sector outcomes. Public sector outputs can also be hard to quantify and measure – especially across multiple sectors, agencies, or locations.
Past work has used citizen surveys that ask about the provision of public services to measure public sector outputs such as access to health and education services.Footnote 82 This approach assumes that if citizens report lacking access to a particular public good, then this good was never budgeted for. Yet public funds are quite often allocated to public infrastructure that is never built. Data from African countries indicates high levels of “ghost” and “unfinished” projects.Footnote 83 This suggests that scholars interested in bureaucratic processes and outputs should collect data on original budget allocations rather than relying on end-users’ access.
As this discussion highlights, studying the public sector (in almost any context) involves evaluating some degree of bureaucratic malpractice or corruption. Given that corrupt acts are also typically illegal, perpetrators have strong incentives to conceal their involvement in these activities. While researchers can employ end-user surveys to gather data on petty corruption, they cannot rely on public reports to obtain accurate data on mid-level or grand corruption. An alternative to surveying the mass public is to survey private firms and ask if they have paid bribes to politicians or bureaucrats in return for public contracts. However, this approach is unlikely to produce reliable estimates if firms collude with politicians or bureaucrats: firm owners may have incentives to lie.
An alternative data source to investigate mid-level and grand corruption is audit reports. Seminal work on corruption in Brazil, for example, uses audits from randomly sampled municipal governments to track irregularities in financial management and procurement.Footnote 84 However, audits are only effective at measuring corruption when politicians and bureaucrats cannot manipulate audit reports, which is not the case in many settings, including in Ghana.
To overcome these challenges, I adopt two broad approaches. First, I analyze a single-country case (Ghana) in depth, which allows me the time to gain access to public bodies and collect data on public sector outputs and the processes that produce them. A within-case analysis also has methodological advantages, such as holding background factors constant. Ghana is a particularly attractive case to study public sector outputs because classic explanations of bureaucratic inefficiencies are insufficient. As I document in detail in Chapter 3, most Ghanaian civil servants are well educated and recruited through competitive processes.Footnote 85 While personal and political connections can play a role in who is ultimately recruited, these connections cannot help applicants without the necessary professional qualifications.Footnote 86
Within Ghana, I focus on local governments to investigate subnational variation in governance and development. As in many other African countries, local governments in Ghana are mandated to deliver public services to residents. A central office in the capital, Accra, recruits and hires all bureaucrats, which allows me to hold bureaucratic capacity largely constant across offices. After they are hired, bureaucrats can be posted to any of the country’s local governments.
My second broad approach is to combine qualitative and quantitative research methods. Mixed methods are particularly useful for studying sensitive topics such as bias and corruption in the distribution and construction of local public goods. In-depth interviews in which a rapport is built between the interviewer and interviewee can increase the likelihood of making discoveries. Interviews give respondents the opportunity to frame issues in their own words, which can reveal new perspectives on problems. In-depth interviews also have a unique ability to help researchers understand agents’ goals and incentives. To increase the generalizability of data collected via interviews, I interviewed bureaucrats and firms from a random sample of local governments. Since it would have been too time consuming to conduct interviews in each of the local governments sampled (
), the collection of quantitative data further aids generalizability.
Quantitative research methods make it possible to investigate whether the insights gained from interviews are generalizable. Furthermore, large-n anonymous surveys and survey techniques that provide plausible deniability can promote honest responses. Finally, experimental methods are unrivaled in their ability to tackle questions of causality, which makes them a powerful tool for any researcher. Triangulating evidence from qualitative and quantitative methods thus permits both rich theory generation and thorough theory testing.
1.4.1 Sample and Data Sources
I collected data from a random sample of 80 of Ghana’s 216 local governments.Footnote 87 I restricted the sampling frame to districts from five contiguous regions (Central, Eastern, Brong-Ahafo, Ashanti, and Volta).Footnote 88 Before sampling, I stratified districts by level of electoral competition to assess my theoretical expectations about how local electoral competition affects governance. I measure electoral competition using the parliamentary election results from the 2012 general election. This process ensures that half of the sampled local governments preside over competitive districts. Figure 1.3 maps the locations of the local governments in the sample.
Map of the eighty local governments in the sample
Note: The map displays the boundaries of the country’s sixteen regions and four largest cities. Within the regions in the sample, I display the boundaries of each district. The dots indicate the location of the sampled local governments.
Table 1.2 overviews the qualitative and quantitative data I collected. The bulk of the qualitative data comes from in-depth interviews with local bureaucrats (
) working across several local governments. These interviews were conducted between August 2015 and March 2016. I interviewed civil servants working in all six regions in the sample, as well as in two pilot districts in Greater Accra. I also interviewed a handful of high-level regional bureaucrats from the sampled regions. Interviews lasted an average of 30–40 minutes, but some lasted over two hours. These interviews provided deep contextual knowledge of administrative processes and decision-making within districts. I also interviewed a small number of local politicians and private contractors. Interviews with private contractors were conducted in February 2018. In all cases, I reassured interviewees that their comments would be anonymous. I did not record the interviews; I typed what respondents said as they spoke.
Table 1.2 Long description
Table presents five sources of data used in the book., with columns for data type, description, sample size (N) and an explanation of uses of the data. Qualitative data from politician, bureaucrat, and contractor interviews includes 49 face-to-face interviews across local and regional governments, used to document strategies undermining competitive public procurement. Quantitative data from a bureaucrat survey includes 864 face-to-face surveys and experiments with high-level bureaucrats in 80 of 216 local governments, used to assess corruption prevalence, evaluate politicization, and analyze political control over careers. A bureaucrat dataset covers 40,824 local bureaucrats across 216 governments, used to assess merit versus politicization in recruitment. The first project dataset includes 5,204 infrastructure project records and is used to analyze politicization levels, while a second dataset includes 1,174 project records with within-district location data, also used to analyze politicization of project locations.
I also collected three types of quantitative data. First, I obtained access to the first dataset of individual bureaucrats working across all local governments in the country. This data was collected in 2016 as part of a European Union-funded project focused on local government staff and capacity building. This data allows me to provide detailed descriptive information on bureaucrats who work across local governments. I also use this data to assess the first implication of my theory. In Chapter 3, I establish that most high-ranking bureaucrats are hired based on merit. This data also allows me to conclude that the same is likely not true for bureaucrats hired into low-ranking positions.
Second, I conducted an original face-to-face survey of high-ranking bureaucrats working across the sampled districts (
). I selected the holders of the twelve most important positions in the local government system, which are constant across districts. I hired and trained a team of enumerators to conduct the surveys in private. The survey included a number of questions on the bureaucratic hiring process; I use this data to complement the analysis of recruitment in Chapter 3.
This survey also included questions that allow me to assess the theory’s second observable implication – that bureaucrats will be more likely to engage in bad governance when politicians can credibly threaten them with career control tools. Because politicians often informally influence bureaucrats’ career progression, it can be hard to collect objective data to measure politicians’ individual leverage. Arguably, what is most important is how much power individual bureaucrats perceive politicians have over their careers. In Chapter 4, I use the survey responses to measure bureaucrats’ perceptions of local politicians’ ability to interfere in their careers and assess whether this correlates with corruption.
I embedded three experiments (two audio vignette experiments and a list experiment) in the bureaucrat survey to assess potential politicization in the allocation of public goods projects across communities and in the awarding of public contracts. In both audio experiments, respondents listened to the vignettes through individual headphones. The first assesses bureaucrats’ perceptions of whether a community’s voting record influences their chances of receiving a project. The second audio experiment considers which private firm traits shape whether they receive projects. These experiments allow me to randomly manipulate community and firm characteristics, which then helps me assess the traits’ causal effects on community and firm selection. I leverage variation in electoral competition across sampled districts to assess the third implication of the theory.
The list experiment focuses on a mechanism to explain bureaucrats’ individual participation in corruption or misallocation. Responses to all experimental questions were self-administered to promote honesty, as respondents entered their answers directly into a cell phone.
The third source of quantitative data is a dataset I constructed on local public goods projects undertaken by the eighty local governments in the sample between 2008 and 2016. I digitalized reports that local governments submit each year to the National Development Planning Commission to document their progress in implementing their Medium-Term Development Plans (MTDP) that they write every five years (see Figure 1.4 for an example). My dataset includes 5,204 projects; 3,837 (73.7%) include the name of the firm that was awarded the contract.
Extract from the annual progress report
Figure 1.4 Long description
Columns include serial number, project description, location, contractor, award date, completion date, project cost source of funding, and status.
I use this project database to investigate two aspects related to the construction of public infrastructure. First, in Chapter 5, I explore which private firms are hired to build each local project. Using this data, I investigate the potential politicization of public procurement based on the number of projects firms typically win, and across how many locations.
Second, in Chapter 6, I assess evidence of political interference in the allocation of projects to communities within districts. The progress reports include the locations of each project. For local governments in one region of the sample (Central Region), I worked with bureaucrats to precisely link these projects to electoral areas (EAs) – the smallest political unit within a district. Again, in these analyses, I investigate the potential role of electoral competition to assess the third observable implication.
1.5 Broader Implications
The book’s theoretical argument and results have several important implications, many of which I discuss in the concluding chapter (Chapter 7). However, two are particularly significant. The first is the need to move beyond a focus on bureaucratic selection when considering how to improve the performance of public sector offices in developing democracies. There is little doubt that meritocratic recruitment is crucial to ensuring that bureaucrats possess the relevant knowledge and skills to deliver public services effectively. However, the power relations between politicians and bureaucrats are equally consequential to public sector performance. The second key implication is the need to build more complex models of political and bureaucratic decision-making in order to assess the competing dyadic as well as triadic relationship among voters, politicians, and bureaucrats.Footnote 89 Often, these actors’ incentives are considered in isolation, or the agency of one actor is dismissed at the expense of another. Models of politics that consider relations among these three sets of actors are likely to be the most beneficial to future theoretical and empirical advancements.
1.5.1 Career Protection after Meritocratic Recruitment
My argument implies that in addition to competitive hiring procedures, career separation between politicians and bureaucrats is a key, if not the key, ingredient of better governance. This argument builds on prior work. As others have noted, career separation is crucial as it supports opportunities for checks and balances between politicians and bureaucrats.Footnote 90 Further, impartial promotion procedures incentivize bureaucrats to focus on performance rather than on building political connections, which can increase public sector effectiveness.
However, my argument highlights the danger of using indicators of meritocratic recruitment to measure career separation between politicians and bureaucrats.Footnote 91 While recruitment based on merit may increase the likelihood of career separation, this relationship is not automatic. I argue that politicians often have very strong incentives to combine merit-based hiring with tools designed to impede career separation.
The concept of career separation is closely related to that of bureaucratic autonomy. Indeed, political control over bureaucrats’ careers limits bureaucratic autonomy. Historical accounts of the professionalization of the public sector in Britain and the United States describe the process of taking power from politicians and empowering bureaucrats.Footnote 92 More recent work on governance by Francis Fukuyama theorizes that mid to high levels of bureaucratic autonomy will produce the highest levels of performance (an “n-shaped” relationship between autonomy and the quality of government).Footnote 93 He argues that the inflection point at which more autonomy will reduce performance varies depending on the capacity of the state: “lower-capacity countries have their inflection points shifted to the left [less autonomy], while they are shifted right [more autonomy] for higher-capacity countries.”Footnote 94 In other words, for optimal outcomes, bureaucrats should be more closely bound by rules in lower- than in higher-capacity countries. However, my argument implies that even in so-called lower-capacity countries, optimal levels of bureaucratic autonomy are still likely to be quite high.
My argument fits with empirical evidence from bureaucracies in developing democracies that points to the potential benefits of high levels of bureaucratic autonomy, which have been found to promote administrative performance.Footnote 95 For example, in Nigeria, greater bureaucratic autonomy is correlated with the quantity and quality of public services delivered, while a one-standard-deviation increase in monitoring corresponds to a 14 percent decrease in project completion rates.Footnote 96 My argument highlights an important mechanism through which autonomy can increase performance – by allowing bureaucrats to administer public programs independently of political considerations.
Overall, my argument implies that scholars and practitioners both need to consider (and develop) better measures of career separation. By describing the specific tools politicians employ to control bureaucrats’ careers, scholars can develop appropriate indicators. These indicators will in turn allow scholars to develop more sophisticated arguments to understand variation in governance practices across both geographic space and public sector units.
1.5.2 Triadic Models of Politics that Consider Politicians’, Bureaucrats’, and Voters’ Incentives
An important implication of this book is that scholars and policymakers should treat public sector outcomes as the result of complex interactions among voters, politicians, and bureaucrats. Commons models of bureaucratic corruption suppose that bureaucrats’ decisions to engage in corruption result from an individual and isolated process. Bureaucrats will accept a bribe if its value outweighs the risks of being caught and losing their current wage. At the same time, common models of distributive politics view politicians and voters in dyadic relationships with each other: politicians consider voters’ preferences and distribute benefits to them to maximize their chances of winning elections. The former models ignore potential pressures that politicians place on bureaucrats to engage in corruption, while the latter overlook bureaucrats’ agency in blocking politicians’ ability to allocate public goods with discretion.
My theory suggests that voters, politicians, and bureaucrats interact in competing dyadic relationships, and in a triadic relationship with each other.Footnote 97 For example, politicians’ level of control over bureaucrats’ careers shapes the latter’s decisions about whether to engage in corruption. Accordingly, bureaucrats may gain little personally from engaging in corruption, and instead direct captured rents toward politicians or political parties.Footnote 98 My insights on corruption can equally be applied to other types of bureaucratic behavior. For example, bureaucrats have been shown to use their positions to provide favors to constituents, typically to benefit their political superiors.Footnote 99
Prior work has explained bureaucrats’ provision of favors by referencing their shared fate with politicians: stability in bureaucrats’ jobs depends on continuity in the appointment of their political principal.Footnote 100 As with corruption that bureaucrats undertake primarily for the benefit of political parties, administrative favors cannot be understood without considering politicians’ incentives and ability to hire, relocate, or reassign tasks among bureaucrats. But voters are also an important part of this phenomenon: citizens’ preferences and expectations shape the types of favors that bureaucrats perform. Thus, an important takeaway is that bureaucrats’ incentives, as well as the preferences and incentives of politicians and citizens, shape the functioning of the public sector and bureaucrats’ day-to-day activities – from more nefarious actions such as corruption to more mundane functions such as assisting with personal requests.
However, as this book emphasizes, it is important not to exaggerate bureaucrats’ susceptibility to political pressure. They do not always bow to the whims of their political superiors, and politicians vary in the extent to which they expect or ask bureaucrats to engage in corruption, distribute favors, or politicize distribution. While the corruption literature potentially underplays politicians’ role in directing administrative corruption, research on distributive politics often assumes that bureaucrats are completely beholden to politicians. Many models of distribution treat bureaucrats as a silent actor, and assume they are universally willing to help fulfill politicians’ demands.
The conventional wisdom in the study of electoral politics in African democracies maintains that elected politicians favor their party supporters (or co-ethnic voters) when distributing public services.Footnote 101 Yet, a careful reading of prior studies illustrates that non-favoritism is just as common as – or more common than – favoritism. For example, one study that focuses on education and health provision finds evidence of ethnic favoritism in only six of the eighteen African countries studied.Footnote 102 Recent evidence suggests that variation in politicized distribution is likely to be partly explained by whether or not a politician’s supporters live in segregated communities within constituencies.Footnote 103 Bureaucratic autonomy is yet another overlooked aspect of politicians’ opportunity to favor their supporters with public goods. Where bureaucrats have the autonomy to implement policy, they may be unwilling to help politicians engage in favoritism. They can exert their independence to undermine or block such attempts. Bureaucrats implement government policies and should therefore be a central actor of any explanation of distributive bias. However, scholars of distributive politics typically ignore bureaucratic decision-making.
Excluding bureaucrats from discussions of distributive politics assumes that bureaucratic autonomy is universally low, and that the programmatic distribution of state resources is not possible. Yet without examining bureaucrats, we cannot explain the null results reported in prior work. Some of these null relationships may arise from high levels of bureaucratic autonomy and professionalism within certain sectors in countries.Footnote 104 Considering the role of all three actors will thus generate theoretical and empirical advancements.
1.5.3 Plan of the Book
This book is divided into five parts. Part I is composed of Chapters 1 and 2, which describe the puzzle that drives the book: why meritocratically hired bureaucrats may still engage in corruption or undermine attempts at programmatic distribution. Chapter 2 develops my theory of governance, which focuses on the incentives and preferences of politicians, bureaucrats, and voters. I argue that politicians in developing countries face a dilemma when they seek to invest in bureaucratic capacity: they must weigh increases in bureaucratic competence against the potential loss of bureaucratic loyalty. I propose that politicians have incentives to hire bureaucrats on the basis of merit to promote bureaucratic competence, but also to retain the means to control their careers. This allows them to extract loyalty as necessary. Therefore, variation in governance results from disparities in politicians’ opportunities and motivation to employ career control tools.
Part II of the book, which consists of Chapter 3, describes the study’s empirical setting – Ghana. I provide a short history of public sector development, an overview of electoral politics, and a history of local governance. Importantly, Chapter 3 presents evidence that recruitment into high-ranking bureaucratic positions has become relatively meritocratic over time in Ghana. This sets the stage for the puzzle the rest of the book investigates: why do bureaucrats hired based on merit misallocate public resources and engage in corruption?
Part III of the book is presented in Chapter 4, which focuses on how politicians extract loyalty using career control tools. It assesses the second implication of my argument – that such tools are correlated with bad governance outcomes. I demonstrate a positive correlation between politicians’ perceived ability to enact bureaucratic transfers and corruption in public procurement within local governments.
Part IV of the book discusses the consequences of career control tools beyond corruption. I provide evidence of political interference in two types of administrative processes – awarding public contracts to construct new public infrastructure and allocating local public goods within districts. Chapter 5 establishes that contracts to build local public goods are often awarded on the basis of political criteria: firms aligned with the ruling party are more likely to win contracts. Chapter 6 provides evidence that local public goods are also often allocated according to political criteria: more local public goods are awarded to communities that vote for the ruling party. Both chapters demonstrate that political interference is higher in competitive electoral districts, where mayors have more incentives to engage in non-programmatic distribution.
Chapter 7 constitutes Part V of the book. It first discusses the theory’s scope conditions. I then present the parallel cases of India and Indonesia and provide evidence that politicians’ use of career control tools is important for understanding governance outcomes in both contexts. Finally, Chapter 7 discusses reforms countries could adopt to overcome the bad governance equilibrium described in the book.
Political institutions shape economic outcomes.Footnote 1 While the Washington Consensus espoused by international donors and inflicted upon developing countries in the 1980s and 1990s fought against “oversized” states, policymakers now largely accept that states help rather than hinder long-run economic growth.Footnote 2 The critical question for governments and development practitioners alike is not how to weaken state influence, but how to build state capacity to support development.Footnote 3
State capacity is a multidimensional concept typically described as comprising three elements – coercive, extractive, and administrative capacity.Footnote 4 Coercive capacity refers to a state’s monopoly over violence within the territoryFootnote 5: a strong state has a military that can protect external borders. Extractive capacity assesses a state’s ability to raise funds through taxation. Finally, administrative capacity relates to a state’s ability to implement policies. Accordingly, administrative capacity relates to the concept of governance, defined as “a government’s ability to make and enforce rules, and to deliver services.”Footnote 6 The focus of this book is this third arm of state capacity. The book seeks to understand when politicians will invest in better governance, and to explain variation in governance within countries.
Chapter 2 develops a theory of governance that considers the triad of actors whose incentives and preferences influence investments in state capacity – politicians, bureaucrats, and voters. I theorize that politicians seek to retain (or obtain) electoral office and attract voters by distributing benefits to them. Politicians can deliver universal benefits to voters or benefits that follow rule-based criteria (programmatic distribution) or deliver benefits using ad hoc, discretionary criteria (non-programmatic distribution). When politicians seek to enhance programmatic distribution, they have incentives to professionalize the public sector. Professionalization involves adopting reforms that enhance governance – making policy design and implementation more efficient. Chapter 2 considers one relevant reform that can aid governance: the strengthening or expansion of merit-based selection institutions. Merit-based institutions have the potential to increase bureaucratic competence by selecting better trained and motivated individuals into the public sector.
However, politicians who seek to win votes using non-programmatic distribution will shy away from such reform and seek to retain the status quo because non-programmatic distribution is inherently ad hoc and politically motivated. Engaging in such distribution often involves asking bureaucrats to manipulate formal rules or procedures or take part in corrupt acts. Accordingly, politicians will find non-programmatic strategies easier to implement when bureaucrats are loyal. Loyalty is enhanced when politicians select public employees on the basis of their partisan or personal ties. In other words, politicians who seek to use non-programmatic distribution will have an incentive to maintain the status quo and to select bureaucrats who desire to fulfill the objectives of the incumbent political party or politician, whatever these objectives may be.Footnote 7 Loyalty may stem from ideological allegiances or be the result of ethnic, sectarian, or personal ties.Footnote 8
In practice, politicians in most developing democracies attempt to win votes by engaging in both programmatic and non-programmatic distribution.Footnote 9 Yet mixing programmatic and non-programmatic distributive strategies presents a dilemma for politicians. On the one hand, they have an incentive to invest in bureaucratic competence to aid programmatic distribution. On the other hand, they seek to retain bureaucratic loyalty to make it easier to continue to implement non-programmatic strategies. While bureaucrats who are both loyal and competent would make the ideal recruits, in practice, workers who prioritize partisan attachments are likely to invest less in education and public sector work experience. Indeed, a common assumption is that the pool of partisan workers who are competent is shallower and more heterogeneous than the pool of professional appointees.Footnote 10 Furthermore, bureaucrats who know they are hired partly on the basis of partisan loyalty are likely less hard-working or mission orientated than those hired based purely on merit.Footnote 11
To resolve this dilemma, I argue that politicians will recruit bureaucrats via merit-based institutions, but will seek to retain the ability to control bureaucrats’ career progression, for example, by interfering with their promotions, geographic transfers, or work portfolios. Such interferences, I term career control. Career control tools are powerful because bureaucrats in many developing countries do not have attractive exit options. In such contexts, formal employment remains scarce, and public sector jobs are typically more secure and pay better than those in the private sector.Footnote 12 Politicians benefit from recruiting competent bureaucrats and engaging in career control as this strategy is flexible, and allows them to activate – and switch between – bureaucratic loyalty and competence at different points in time, and potentially across different policy domains. Implementing such a strategy can also help explain variation in administrative performance and levels of corruption within countries as politicians may not be equally incentivized to control bureaucrats’ careers to extract loyalty across geographic districts or policy sectors. Indeed, I argue that politicians’ opportunities and motivation to use career control tools helps explain the internal variation we see in governance across countries around the world.
More generally, political control over, or interference in, bureaucrats’ careers is a central and overlooked factor that explains public sector performance and corruption in low- and middle-income countries. While the literature highlights the importance of merit-based institutions in promoting administrative performance and decreasing corruption,Footnote 13 equal emphasis should be placed on the conditions that bureaucrats face after recruitment, especially those related to politicians’ formal or informal authority over their careers.Footnote 14
2.1 Politicians’ Dilemma: A Trade-off between Bureaucratic Competence and Bureaucratic Loyalty
Politicians’ primary motivation is to gain or retain political office. I assume that politicians attract voters by providing benefits to them via either programmatic or non-programmatic distribution.Footnote 15 Programmatic distribution satisfies two conditions: (i) the criteria for benefits are defined and public and (ii) these criteria shape distribution in practice.Footnote 16 The fact that beneficiaries are publicly defined ensures that benefits are not distributed as a direct reward for voting for a certain political party.Footnote 17 By contrast, non-programmatic distribution involves identifying recipients using ad hoc, and often political, criteria. This method is often contingent on recipients voting (or continuing to vote) for a particular party. Prior work in this area refers to contingent, non-programmatic distribution as clientelism – an electoral strategy that politicians throughout history have used, and continue to use in many countries.Footnote 18
Programmatic distribution includes the delivery of (i) universal public goods, which are non-exclusive and open to all citizens (e.g. economic stability, large-scale public infrastructure) or (ii) goods to which access is automatic for those who satisfy a fixed criterion (e.g. worker benefits, pensions). Non-programmatic distribution includes the delivery of exclusive goods to either individuals (e.g. a public sector job, a gift or money) or communities (e.g. targeted local infrastructure projects).Footnote 19 Programmatic benefits are typically financed by public funds, and, therefore, bureaucrats play a key role in the implementation of such policies. Politicians engage in non-programmatic distribution both during election campaigns and in the electoral off-cycle. This type of distribution often peaks in the run-up to elections, when politicians distribute private benefits to voters to attract their support – a phenomenon sometimes called “vote buying.”Footnote 20
Politicians also often use public funds to distribute benefits non-programmatically to voters.Footnote 21 This, again, usually involves working with bureaucrats. Non-programmatic distribution often involves politicians and bureaucrats converting funds meant for programmatic distribution into non-programmatic benefits. For example, the national government may task bureaucrats with implementing a cash transfer program and provide criteria on how they should select beneficiary households. Local politicians may then request that bureaucrats ensure that specific households receive the transfers. Alternatively, the national government may provide bureaucrats with criteria to select communities that should receive a local public good, but politicians could ask administrators to favor certain communities. Non-programmatic distribution can also involve bureaucrats providing favors or personal services to certain segments of the electorate.Footnote 22 Scholars have identified this type of clientelism (referred to as “relational clientelism”) as a key element of many politicians’ electoral strategies.Footnote 23
Politicians’ desire to distribute private benefits to voters and/or local goods to communities can also encourage them to capture public funds via corrupt practices. For example, embezzlement is one way in which politicians and bureaucrats can convert public funds into cash. Politicians often desire cash because it is completely fungible: they can spend it on private benefits to citizens, campaign or party-related activities, or self-enrichment. Alongside embezzlement, politicians may also interfere in public procurement processes to access funds for non-programmatic distribution.
The way in which politicians seek to distribute goods, will influence the type of bureaucrats they prefer to be hired into the public sector. Politicians who seek only to deliver goods programmatically are likely to prioritize bureaucratic competence, as these officers can efficiently design policies and support rule-based implementation. Therefore, to enhance programmatic distribution, politicians are likely to support the strengthening of meritocratic recruitment processes. In contrast, since non-programmatic distribution often involves manipulating administrative processes or embezzling funds, politicians engaged in such practices are likely to prioritize bureaucratic loyalty over competence. Loyal bureaucrats will be more willing to politicize public programs or engage in corruption that benefits politicians. Accordingly, politicians who favor non-programmatic have fewer incentives to invest in reforms that strengthen meritocratic recruitment. Figure 2.1 displays the two main distributive methods available to politicians and the strategies they use to achieve them. Politicians who seek to move toward programmatic distribution will be inclined to invest in professionalization reforms, while those who prioritize non-programmatic distribution will be motivated to retain the status quo.
Politicians’ aims and methods and the implications for public sector professionalization
Figure 2.1 suggests that politicians face a stark choice: they adopt either programmatic or non-programmatic ways to distribute resource. Yet, in practice, politicians in most developing democracies are likely to want to mix both modes of distribution.Footnote 24 This is especially likely at different levels of politics. Presidents and ministers, who must satisfy broad, national constituencies, may be inclined toward universalistic programs, large-scale public goods, and programmatic distribution to reach a large number of voters. For example, after democratization in the early 1990s presidential candidates across countries in sub-Saharan Africa abolished primary school fees as a universalistic policy to attract support.Footnote 25 However, local politicians (MPs, mayors, etc.) may be inclined toward non-programmatic distribution. For example, MPs in many low- and middle-income democracies have been granted constituency development funds, which they often use to target club goods at specific communities.Footnote 26 Local politicians often seek to claim credit for local public goods provision.
Introducing universal policies or constructing large-scale public goods is beneficial to politicians because these can benefit large groups of voters. At the same time, because coverage is non-excludable and usage is irreversible, such investments are inherently more risky than excludable transfers to individuals.Footnote 27 Thus, politicians and leaders within political parties are often cautious to wholly rely on universalistic distribution. Awarding benefits via discretion enables politicians to target specific individuals or communities. Non-programmatic distribution can offer politicians more certain electoral returns compared to programmatic distribution because they are targeted and reversible. However, an important downside of targeted strategies is the effort it takes politicians to hand-select recipients and tailor particular goods that suit their needs. Politicians often have to rely on local brokers to gather information and distribute goods to voters, which can result in additional costs for parties and candidates.Footnote 28 Politicians’ desire to build a portfolio of both programmatic and non-programmatic benefits ensures that they have incentives to favor both bureaucratic competence and bureaucratic loyalty.
Beyond politicians’ desire to deliver non-programmatic goods to citizens, they may also seek loyal bureaucrats because such bureaucrats are likely to be more willing to overlook attempts to extract public resources for election campaign activities or self-enrichment.
2.1.1 Politicians’ Need for Loyal Bureaucrats Beyond Non-programmatic Distribution: Financing Election Campaigns
Politicians often seek to redirect public funds allocated for programmatic distribution into funds they can use for non-programmatic purposes. This conversion typically involves asking bureaucrats to modify specific administrative processes. Politicians find it easier to do so when bureaucratic loyalty is high. In addition to capturing public funds for distributive purposes, incumbent politicians also often attempt to use public money or manipulate administrative processes to finance their election campaigns.Footnote 29
Two factors that incentivize politicians to look to the public sector for campaign funds are (i) the lack of alternative funding and (ii) the high costs of election campaigns. The need to self-fund election campaigns can be considered a push factor in administrative interference, while the high cost of elections is an important pull factor. Considering the former, unlike in advanced democracies, where political parties often provide candidates with significant funds, political candidates in many developing democracies are typically expected to use their own funds to finance their campaigns.Footnote 30 While political parties in such contexts sometimes receive public funds, these funds are often insufficient and irregular. Thus, parties cannot use them to cover even basic campaign costs for individual candidates. Considerably more money is available to incumbent political candidates via the illicit capture of public funds.
Regarding high election costs, while election campaigns in democracies all over the world are expensive, they are especially costly in developing countries. High costs partly result from the nature of campaigning in such contexts, with candidates expected to conduct large-scale, face-to-face campaigns. Accordingly, candidates must use rallies and door-to-door canvassing to reach voters.Footnote 31 The need to be physically present across districts imposes high travel costs on candidates, especially when road conditions are poor. At the same times, village meetings, rallies, street processions, and house-to-house canvassing are expensive to organize. The costs of such events include not only the logistics – erecting stages, microphones, speakers, etc.; politicians also often have to pay party workers to mobilize crowds to attend them.Footnote 32 Another significant cost for political candidates are the particularistic benefits that voters often expect to receive during campaigns either when they are canvassed or at public events.
In many countries, campaign costs also soar because of insufficient legal regulations. Formal spending limits during election campaigns are often absent, or where they exist are insufficiently enforced, or set so low that candidates ignore them. As a result, candidates can end up spending large amounts in competition with each other. One example is India, where there are formal campaign spending limits, but candidates routinely spend ten times this amount, and sometimes exceed it by thirty or fifty times.Footnote 33 In the context of Africa, many countries impose no limits on campaign spending. Where limits exist, the institutions that are meant to regulate them are often not independent or lack the resources to monitor donations and spending.Footnote 34 Accordingly, it has been argued that “this type of regulation [regulation on spending] plays no practical role in African political finance.”Footnote 35
In summary, the pressure to engage in, and self-finance, costly election campaigns often means politicians look to the public sector. Corrupting public procurement processes is a common way to capture funds.Footnote 36 Manipulating public procurement processes is attractive to incumbent politicians because of the scale of public contracts within the economy: procurement constitutes about 14% of GDP and averages 50% of government spending in African countries.Footnote 37 Capturing a fraction of such money can significantly aide a candidate’s campaign funds.
Malfeasance in procurement typically requires corrupt actions from three sets of actors – private firms, politicians, and bureaucrats. Private firms often either pay bribes or donate to politicians’ campaigns in exchange for contracts. To favor particular firms, politicians and bureaucrats administer uncompetitive procurement auctions. This quid pro quo between private firms and politicians has been identified in a number of countries, including Lithuania,Footnote 38 India,Footnote 39 Russia,Footnote 40 Brazil,Footnote 41 and Colombia.Footnote 42 Instead of favoring companies that offer bribes or donations, politicians may also seek to favor companies owned by local party officials.Footnote 43 However, again, such an arrangement signifies an exchange between the firm owner and the political candidate: the candidates will likely expect the party official to campaign on their behalf. Whatever the motivation of political candidates, politicians who seek to extract resources for their campaign via public procurement must secure the loyalty of the bureaucrats who administer the procurement process. Such loyalty will be more likely if bureaucrats are recruited on the basis of their personal or partisan attachments. Therefore, politicians who seek to use the public sector to finance their campaigns will be generally hesitant to professionalize the public sector.
2.1.2 Why Professionalizing the Public Sector Decreases Bureaucratic Loyalty
Professionalizing the public sector by strengthening merit institutions and giving bureaucrats more autonomy over their daily tasks can make programmatic distribution more efficient by increasing bureaucratic competence. However, it can also decrease bureaucratic loyalty through at least four mechanisms. First, meritocratic recruitment restricts the opportunities available for political patronage because jobs that were once allocated to party or politician loyalists are now distributed according to competitive criteria. Second, and related, bureaucrats selected through a competitive process are less likely to feel obliged to help politicians convert programmatic funds into non-programmatic benefits than those hired based on their personal ties.Footnote 44 Third, public sector professionalization often involves automating certain processes to limit politicians’ discretion – for example, to select program beneficiaries. This leaves fewer opportunities for politicians to manipulate or interference in distribution. Fourth, public sector professionalization may include the creation of oversight or sanctioning institutions, which can increase the risk of punishment for bureaucrats who engage in corruption. Such institutions can make even loyal bureaucrats more weary of manipulating administrative processes on behalf of politicians.
How do politicians solve this dilemma? Political parties and politicians can partly solve their desire to mix programmatic and non-programmatic distribution by differentially investing in bureaucratic competence across the public sector to create “islands of efficiency.”Footnote 45 This allows politicians to benefit from gains to governance in key sectors that may be highly consequential to, for example, economic growth. Alternatively, national or regional political leaders may use bureaucratic postings to post the most loyal bureaucrats to districts of the country where the need for loyalty is most consequential.Footnote 46
An alternative strategy that allows politicians to increase bureaucratic competence without significantly decreasing bureaucratic loyalty is for them to introduce or rely on merit to recruit bureaucrats, but retain the ability to control their careers to coerce loyalty from them when loyalty is needed. This strategy is depicted in Figure 2.2. It is more flexible than, for example, creating islands of efficiency because it allows politicians to benefit from the gains of bureaucratic competence across multiple policy domains or geographic locations. I next explain why career control is a powerful way to generate bureaucratic loyalty.
Politicians’ aims and methods and the implications for public sector professionalization after assuming a preference to engage in both programmatic and non-programmatic distribution
2.2 Solving the Dilemma: Controlling Bureaucrats’ Careers to Solicit Loyalty
In a recent report, the United National Development Programme stated that “to function effectively and achieve its development agenda, a country must prioritize investments in a professional, merit-based civil service” (274).Footnote 47 Indeed, meritocratic recruitment is widely considered desirable. It is associated with better governance outcomes, including less corruption, lower levels of wasteful government spending, and better management performance.Footnote 48 At the individual level, bureaucrats hired competitively are perceived to have higher levels of public service motivation and to be less corrupt.Footnote 49 However, career control allows politicians to rely on the loyalty even of bureaucrats who were recruited via merit-based, competitive processes, which can undermine some of these positive effects. Politicians can control careers by using promotions, geographic transfers, or bureaucrats’ work portfolios as either carrots to reward compliance (e.g. award promotion, transfer to a favorable post, assign creative or thought-provoking tasks) or as sticks to punish disloyalty (withhold promotion, enact an unwanted transfer, or allocate mundane or menial tasks).
To understand why politicians’ ability to control the careers of bureaucrats is such a powerful tool, I consider two possible mechanisms through which meritocratic recruitment may improve governance. The first is that it boosts bureaucrats’ sense of commitment to corporate goals and esprit de corps within the public sector.Footnote 50 The second mechanism is that meritocracy separates the careers of politicians and bureaucrats.Footnote 51 Career separation can enhance administrative effectiveness by fostering mutual checks and balances, aligning promotions with performance rather than personal connections, and improving trust in bureaucratic leadership.Footnote 52 Indeed, on this last point, bureaucrats are argued to be more likely to trust bureaucratic “managers” than political “owners.”Footnote 53
Both of these mechanisms suggest that what matters is not simply how bureaucrats are recruited, but the autonomy and protections they are granted afterwards. Developing a positive esprit de corps takes time. Similarly, the development of trust and potential gains in agency performance rely on bureaucrats being managed fairly by professional superiors, with these superiors basing promotions on individual productivity. If politicians can control how bureaucrats advance in their careers, these channels for positive effects are undermined. Thus, the benefits of meritocratic recruitment depend not only on bureaucratic selection methods but also on insulating career progression from political interference.
Prior work conflates the distinct concepts of (i) meritocratic recruitment into the public sector and (ii) the career separation of politicians and bureaucrats. For example, Dahlström and Lapuente (Reference Charron, Dahlström, Fazekas and Lapuente2017) explain “to capture the theoretical concept of greatest interest to use – the separation of interest between bureaucrats and politicians – we use an indicator of the extent to which recruitment to the public sector is made by merit” (105, emphasis added).Footnote 54 Using meritocratic recruitment to measure career separation is problematic because treating the two concepts as synonymous suggests that they always occur together. However, I argue that politicians have strong incentives to adopt meritocratic hiring while retaining control over bureaucrats’ careers.
I argue that the control politicians, exercise over bureaucrats’ careers after they have been hired is a central and overlooked impediment to administrative performance. An emerging literature observes that bureaucrats can be recruited based on merit, but can later experience high levels of interference in their careers. For example, recruitment into the top ranks of the Indian public sector – the Indian Administrative Service – is highly competitive; only candidates who achieve top scores on the civil service exam are selected. However, bureaucrats’ career progression has been found to depend on both their abilities and their loyalty to elected officials.Footnote 55 Indian politicians have the authority to transfer and promote bureaucrats who they perceive as loyal; there is evidence that they shuffle bureaucrats after changes in political power – a tactic politicians use to enhance bureaucratic loyalty.Footnote 56 Qualitative research has highlighted the deleterious effects of political control over bureaucrats’ careers. Again in India, politicians exploit their power to transfer bureaucrats to other locations to guarantee their loyalty. In this way, politicians “force” bureaucrats to be corrupt on their behalf; not doing so can result in undesirable transfers.Footnote 57 Research on Hungary also demonstrates the insufficiency of legislation to protect the public sector against politicization: politicians have the discretion to change public servants’ rank and to influence promotions, transfers, and dismissals.Footnote 58 To consider why retaining control over bureaucrats’ career progression is powerful, we must also consider bureaucrats’ incentives.
2.2.1 Bureaucrats’ Incentives: Why Career Control Is an Effective Tool
I have argued that politicians build support for their (re)election in part by distributing a mix of programmatic and non-programmatic benefits to citizens. Because bureaucrats administer public resources, politicians have incentives to influence their actions. I argue that politicians can co-opt bureaucrats and ensure bureaucratic loyalty by using tools to influence bureaucrats’ career progression (e.g. promotions, geographic transfers, and work portfolios) (see Figure 2.2). To understand why career interference is so powerful, we must consider bureaucrats’ incentives.
Bureaucrats seek to use their public sector positions to achieve three goals. First, like most employees, they seek to advance in their careers to increase their salary, status, or influence over policy outcomes. Most bureaucracies are organized hierarchically. Because bureaucrats usually have job security and there are typically high levels of internal recruitment, bureaucrats hope (and expect) to rise through the ranks.
Second, bureaucrats have an incentive to work in locations (or government departments) that they prefer. In developing countries with varying levels of economic development across regions, bureaucrats may pursue a public sector job to work in a richer part of the country that offers better public services, such as schools. For example, a recruitment experiment in Mexico, in which public agencies randomized advertised wages for the same job, shows that candidates are attracted to positions in poorer communities only when they are compensated with high wages.Footnote 59
Third, bureaucrats may also use their positions to capture illicit rents (self-enrichment).Footnote 60 While all bureaucrats may have a motive to engage in corruption for personal gain, not all of them will have an equal opportunity to do so. Variation in opportunity depends on the extent to which bureaucrats work independently, are monitored by either political higher-ups or other bureaucrats, and whether their primary activities involve exchanges with individuals. Front-line service workers such as doctors work independently, are not usually closely monitored, and provide individual services to clients. Under such conditions, bureaucrats have opportunities to extract bribes. By contrast, bureaucrats in line ministries or local governments usually work in teams, are monitored by politicians, and do not directly sell outputs (driving licenses, drugs, electricity connections, etc.) to citizens; corruption requires coordination, which limits the opportunities to capture rents. In this book, I focus on the behavior of the latter type of bureaucrats.
Given these incentives, politicians’ ability to influence the careers of bureaucrats is a powerful tool. Interfering in bureaucrats’ promotions or work portfolios can make it impossible or more difficult for them to rise up the ranks and receive the associated higher salaries and status. Geographic transfers, which dictate where bureaucrats must live, are potent because they impact both quality of life and can make promotions more difficult. For example, being sent to a low-status district or agency with little challenging work could have professional costs. Scholars have described the costs of geographic transfers in India: “Officers are exceedingly sensitive to such moves since prestige, influence, and living conditions vary widely between posts (even for officers with similar levels of seniority).”Footnote 61 In short, certain locations (often more urban areas) may be more prestigious and have better living conditions.
2.2.2 Voters’ Expectations and Electoral Preferences
I argue that politicians seek to mix programmatic and non-programmatic distributive strategies as part of a risk-minimizing electoral strategy. The assumption behind this claim is that voters reward politicians who distribute programmatic and non-programmatic benefits to them. In Section 2.2.2, I assess voters’ preferences in young democracies. Such preferences, especially in African democracies, have been asserted to be based on identity ties rather than retrospective or prospective candidate performance evaluations. However, most scholars now agree that voters’ preferences for co-ethnic candidates are typically instrumental: they expect to receive more (private or public) goods for themselves or their communities from such candidates. Accordingly, much of what was once thought of as “identity politics” can be folded into a model of distributive politics.
In many low- and middle-income democracies, voters expect candidates to distribute non-programmatic benefits (i.e. private goods or favors) either during election campaigns or in the electoral off-cycle. Much of the literature focuses on the former – a phenomenon sometimes called “campaign clientelism.”Footnote 62 While there is variation in the prevalence of campaign gifts, in many countries they are widespread. In Indonesia, Kenya, and Uganda, 25–40 percent of the electorate receive private benefits from candidates during campaigns.Footnote 63
There is evidence that voters reward candidates who provide non-programmatic goods. In Kenya, voters are more willing to support political candidates who dispense money to voters than those who do not distribute private benefits.Footnote 64 Voters often interpret campaign gifts not as a direct quid pro quo,Footnote 65 but as evidence that a candidate (i) is viable and (ii) intends to help constituents if they come to office.Footnote 66 Thus, political candidates distribute gifts partly to construct a public image of individual generosity.
While individual acts of “vote buying” may be beneficial to candidates, distributing gifts during elections may have little overall effect, especially if the impacts of multiple candidates offering private gifts cancel each other out.Footnote 67 However, candidates cannot risk not supplying private benefits to voters in case their competitor gains an electoral advantage from doing so. Indeed, voters are likely to perceive a candidate who does not supply gifts as stingy and unlikely to provide patronage or favors in the future.Footnote 68 In effect, given voters’ expectations and the fact that the benefits influence (some) voters, politicians are trapped in a pure prisoner’s dilemma.Footnote 69 While all candidates would be better off not distributing campaign benefits, this equilibrium cannot be sustained because individual candidates have an incentive to defect to capture an electoral advantage. There is also evidence that distributing private benefits is a more cost-effective strategy for candidates than, for example, advertising policy achievements to voters.Footnote 70
In addition to campaign clientelism, voters also often expect politicians to deliver goods and favors during the electoral off-cycle. Repeated interactions between voters and politicians (or “relational clientelism”) are an important way for politicians to sustain their core support bases.Footnote 71 Politicians may dispense financial favors or help citizens navigate the bureaucracy. For example, politicians may help voters obtain a health insurance card, an electricity connection, or apply for a job – often working with bureaucrats to do so.
While prior studies often focus on voters’ preferences for non-programmatic distribution, there is also evidence that they reward programmatic distribution in the form of public (or collective) goods. For example, there is evidence that voters engage in economic voting and reward parties that provide the important public good of economic growth and stability. The incumbent party’s ability to deliver on macroeconomic policies has been shown to be an important determinant of vote choice in multiple regions, including in Africa, Latin America, and Eastern Europe.Footnote 72 Performance voting has also been demonstrated in individual African countries such as Zambia, Ghana, and South Africa.Footnote 73
Another important type of public good that voters reward is the provision of large-scale public infrastructure.Footnote 74 While it is difficult to parse out the causal effects of new infrastructure on vote choice due to potential endogeneity concerns, micro-level data suggests that voters reward the provision of public infrastructure. For example, in Ghana, they are more likely to re-elect presidents who have constructed (or maintained) schools and roads: a one-standard-deviation increase in average road conditions leads to a 1.4-percentage-point increase in the incumbent party’s vote share.Footnote 75 Further evidence from Ghana uses survey evidence to show that swing voters prefer parliamentarians who prioritize “constituency development” (providing local public goods) over distributing private goods.Footnote 76 In short, there is evidence that voters reward politicians who engage in both programmatic and non-programmatic distribution.
The discussion thus far has assumed that voters’ preferences are homogeneous. Yet in practice, the extent to which voters prioritize non-programmatic versus programmatic distribution will vary across different segments of the population. Importantly, voters’ socio-economic status is likely to influence their preferences for particularistic goods. Poorer voters are more likely than their better-off counterparts to support politicians who distribute private benefits or favors, as such goods have a higher relative value for these voters and can be used to solve their immediate problems. Wealthier voters may be more likely to back candidates who focus on programmatic distribution. Survey evidence from several African countries demonstrates that politicians target poorer voters when they distribute gifts.Footnote 77 Regarding voters’ preferences, survey evidence shows that middle-class voters are more likely than poorer voters to prioritize universalistic over particularistic policies.Footnote 78 In Argentina, local politicians are more likely to “opt out” of clientelistic distribution when voters are wealthier.Footnote 79 However, the extent to which politicians prioritize programmatic distribution will vary based on expectations about whether wealthier citizens will turn out to vote. Some evidence in developing democracies suggests that voters’ propensity to abstain for voting increases as they become wealthier.Footnote 80
To summarize, there is evidence that voters evaluate political candidates based on the extent to which they engage in both programmatic and non-programmatic distribution. Distributive considerations are likely to be especially important where ideological attachments to parties are weak or partisan attachments, more generally, are low. In these contexts, individual candidate actions are more likely to influence vote choices. Similarly, voters may be more likely to reward national politicians (e.g. presidents) for programmatic distribution and universalistic policies, and prioritize the distribution of targeted goods when evaluating local politicians (e.g. MPs, mayors, or local councilors).
2.2.3 Electoral Competition
Thus far, I have argued that state development depends at least in part on which strategies politicians pursue to win votes. I maintain that if voters reward politicians who distribute private goods to them, politicians will favor loyal bureaucrats. Pressures on political candidates to self-fund their election campaigns also influence their incentives to favor bureaucratic loyalty over bureaucratic competence.
Above, I explored how voters’ socio-economic condition influences their preferences. In Section 2.2, I consider another variable that prior research has identified as important in determining politicians’ incentives to professionalize the public sector – electoral competition. While electoral competition is often thought to enhance state development, I make the case that the relationship between the two may be multi-directional, and vary depending on whether the source of electoral competition is at the national or local level. While national-level competition may encourage politicians or governments to invest in governance, local competition may undermine administrative capacity by encouraging clientelism and rent seeking. In the remainder of Section 2.2, I disaggregate the concept of electoral competition, discussing its role in terms of (i) the introduction of elections, (ii) national-level competition, and (iii) local-level competition.
Introduction of Elections
When countries transition from authoritarian to democratic rule, the public sector is likely to be impacted. Holding elections introduces competition between political parties and generates new accountability pressures for politicians. Voters gain the ability to sanction governing parties for poor performance or bad governance, which gives politicians an incentive to invest in state capacity to improve the delivery of public goods and welfare.Footnote 81 In African countries, the introduction of democracy is associated with a boost in education spending, which highlights politicians’ increased need to deliver on welfare policies that voters favor.Footnote 82 Cross-national panel data shows that democratization, on average, enhances state capacity.Footnote 83 A detailed study of the introduction of elections in Indonesia demonstrates that democratization increased politicians’ preferences for competent bureaucrats.Footnote 84
Once elections have been introduced, the intensity of competition between political parties varies by country. While a single party dominates elections in some countries, in others, parties achieve narrow victories to obtain a handful more seats in national parliaments or a slim majority in presidential races.
National-Level Competition
Some scholars argue that national-level competition can discourage political investments in the state, including by reducing politicians’ incentives to secure bureaucratic tenure.Footnote 85 Others note that polarization between parties helps explain politicians’ responses to competition.Footnote 86 Yet in general, the scholarly literature suggests that higher levels of national competition can improve public sector development by promoting investments in state capacity for at least three reasons. First, high levels of national competition between parties ensure that political elites expect to alternate in office. Accordingly, politicians are inclined to adopt reforms that create a more level playing field between the ruling and opposition parties as part of an insurance policy for when they are out of office.Footnote 87 Second, high levels of electoral competition create stronger opposition parties with a significant presence in parliament. This allows the opposition to monitor governing parties and pressure them to adopt reforms to establish, for example, oversight and ombudsman institutions.Footnote 88 Third, political parties that face tight electoral competition have an incentive to adopt administrative reforms to capture votes from pro-reform segments of the electorateFootnote 89 – which may help determine election results.
Local-Level Competition
While high levels of national-level electoral competition may incentivize politicians to invest in state capacity, high levels of local electoral competition do not necessarily improve the delivery of public goods or local state capacity. The mechanisms through which competition induces positive results at the national level are not always present within districts or municipalities. For example, in presidential elections the nation is a single constituency, but the same is not necessarily true in local elections. Especially in poor constituencies, only a very small number of voters may reward politicians who invest in public sector professionalization. Because this group may not be consequential in determining elections, politicians may not be persuaded to improve governance. Relatedly, at the local level it may be harder for an individual politician to get credit for investing in better governance relative to a national political party. Finally, while national-level opposition parties are likely to have sufficient resources to monitor the ruling party, this is rarely the case at the local level. Local councils and councilors are often under-resourced and find it difficult to monitor the actions of incumbent mayors or parliamentarians.
I therefore propose that high levels of local electoral competition can undermine good governance and encourage political interference in administrative processes and corruption. Based on my proposed theory, a potential mechanism through which high levels of local electoral competition may undermine state development is by encouraging candidates to prioritizing non-programmatic distribution to win votes.Footnote 90 As political risk increases, politicians seek to distribute private goods to consolidate electoral support.Footnote 91 Indeed, it has been noted that “especially among poor countries, competition enhances clientelism … politicians will move to employ every imaginable strategy of attracting constituents.”Footnote 92 In general, across a diverse set of countries, data suggests that electoral competition amplifies non-programmatic distribution.Footnote 93
In addition to gifts to voters, another important type of private benefit is public sector jobs. Prior work has identified a positive relationship between the level of local electoral competition and the distribution of patronage jobs. In Indonesia, more patronage hiring occurs in districts that feature a strong opposition compared to those in which the ruling party is electorally secure.Footnote 94 Similarly, data from local governments in Ghana shows that high levels of competition are associated with more public sector jobs, especially lower-ranked (and temporary) jobs, which are given to political party activists in exchange for their support.Footnote 95
A second mechanism through which high levels of local electoral competition undermine state development and encourage political interference in administrative processes is by increasing campaign costs within constituencies. Political competition increases politicians’ demand for campaign funds,Footnote 96 and campaign spending has been found to be higher in competitive constituencies.Footnote 97 In competitive districts, non-programmatic distribution becomes increasingly costly as parties begin to target non-poor and more committed voters.Footnote 98 If incumbent politicians rely on the public sector to fund their election campaigns, rising campaign costs are likely to result in increased corruption within local government offices.
An indirect way to assess how electoral competition influences non-programmatic distribution is to consider its effect on programmatic distribution. Assuming a somewhat fixed budget constraint, increases in non-programmatic distribution should lead to fewer local public goods. While the evidence is mixed, in several contexts where scholars have access to micro-level public goods data, a negative relationship between competition and public goods has been found. For example, rising competition in commune-level elections in Mali resulted in fewer local public goods (measured in terms of the number of schools, water boreholes, and health clinics, and the length of rural roads).Footnote 99 In Brazil, municipalities with competitive elections allocate less to social spending than those with less political competition.Footnote 100 However, another study found no relationship between the level of electoral competition and the provision of potable water and sewage in Mexico.Footnote 101
Two scope conditions likely condition the negative effects of local electoral competition on governance. First, this argument is likely to be confined to low- and middle-income countries or poorer constituencies because voters in these contexts are more likely to reward politicians for providing particularistic benefits. Second, the negative effects of local electoral competition may be confined to countries where local opposition parties are not represented in sub-national parliaments. In federalized systems where opposition parties hold seats in local parliaments, electoral competition may play a positive role similar to that identified at the national level through the mechanisms discussed earlier.Footnote 102
2.3 Observable Implications of the Theory
The theoretical discussion above leads to a set of observable implications that I investigate in the remainder of the book. In Chapters 3–6, I assess the theory using original micro-level data from Ghana. In Chapter 3, I present contextual details of the case, including the country’s political and bureaucratic structures. I also present evidence that the bureaucrats I focus on are recruited on the basis of merit – or, at minimum, are not recruited based on their political ties. In subsequent chapters, I assess three main observable implications of the theory.
First, my argument implies that reforms to enhance governance will not be sufficient to protect against political interference in bureaucratic processes. I focus on one important reform – the meritocratic recruitment of bureaucrats. As discussed earlier, scholars often identify meritocratic selection as the cornerstone of a professional bureaucracy and note its positive association with multiple desirable political and economic outcomes. I instead propose that meritocratic hiring cannot be used as a measure of general bureaucratic isolation, and that meritocracy can co-exist with high levels of both political interference in administrative processes and political corruption. In Chapter 4, I demonstrate that this is the case in Ghana.
The second implication is that if politicians subvert merit institutions via the mechanism of career control, levels of administrative interference and corruption should be highest when politicians exert more control over bureaucrats’ careers. A politician’s ability to interfere in a bureaucrat’s career may vary according to factors such as the former’s status or position. For example, politicians who hold senior positions in the party, have had longer careers in politics, or have larger political networks may find it easier to pull the necessary formal or informal levers to influence a bureaucrat’s promotion, transfer them, or determine their work portfolio. This implication relates to politicians’ opportunity to politicize the public sector. In Chapter 4, I show that bureaucrats who perceive that mayors are easily able to control their careers, are more likely to state that there is corruption in the distribution of local public goods in their districts.
Third, if administrative interference is driven by politicians’ need to either engage in non-programmatic distribution or capture public funds for election campaigns, we should observe more interference when they are under greater pressure to pursue these strategies. An implication of my argument is that two types of constituencies have more bureaucratic interference – those that (i) have a large share of poor voters or (ii) are electorally competitive. Politicians in both types of districts are under pressure to engage in non-programmatic distribution either because they are subject to greater electoral risk or because elections are relatively more expensive. Overall, this observable implication relates to politicians’ motive to politicize the public sector. In Chapters 5 and 6, I demonstrate that politicians are more likely to interfere in administrative processes in electorally competitive districts.Footnote 103 The findings in these chapters support the argument that inference is linked to politicians desire to extract resources and engage in non-programmatic distribution.
In Chapter 7, I assess these implications in the context of two other middle-income democracies: India and Indonesia. I provide evidence that politicians use career control tools to extract bureaucratic loyalty in these contexts. The analysis suggests that politicians do so because of pressures they face to engage in non-programmatic distribution and fund their election campaigns. I also provide evidence that greater levels of local electoral competition encourage non-programmatic distribution, which motivates politicians to interfere in bureaucrats’ careers.
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