Governing Through Intermediaries

Abstract:     
Governing Through Intermediaries explores political representation through the lens of agency costs. In particular, it looks at the role intermediaries play in our political system and describes many of them as "superagents," that is, agents who monitor and supervise primary agents on behalf of political principals. While these superagents can help reduce the primary agency costs inherent in representation, they threaten to add a whole new layer of superagency costs to the relationship. We must consider these other costs in designing our political structures. We consider two problems in particular: superagent shirking and fractionated supervision of interests. We also consider the dangers of superagent rent-seeking. While focusing on corporations, unions, and political parties as superagents, the analysis applies to many other entities as well. The piece ends by applying superagency analysis to several thorny issues in campaign finance regulation.

Number of Pages in PDF File: 33

working papers series