The Revolution in Welfare Administration: Rules, Discretion & Entrepreneurial Government

Abstract:     
This paper examines the tremendous changes in the administrative structure of the welfare system that have occurred since 1996. The new administrative model emerging from welfare reform eschews reliance on rules and instead invests ground level agency personnel with substantial discretion. This shift redistributes power between welfare recipients and administrators. Central authorities continue to maintain control by channeling the discretion that ground level officials exercise in order to achieve particular outcomes. This channeling takes place through a variety of means, including performance based evaluation systems and efforts to redefine the institutional culture of welfare offices. These techniques are part of a broad trend in public administration that seeks to make government agencies function like entrepreneurial organizations. This new model raises serious questions of public accountability. In the new system of welfare administration, critical policy choices are reflected in incentive and evaluation systems rather than formal rules. As policy decisions are made in ways that are less visible, there are fewer points of public input.

Moreover, in the new regime the efficacy of administrative hearings as a means of holding agencies accountable to recipients is diminished. The paper suggests several possible means of facilitating public participation and fair treatment. It concludes by urging that scholars, policy makers and advocates focus their attention on developing new mechanisms to provide effective public participation in administrative policy making and implementation in this area.

JEL Classifications: H53, H54, I30, I38, K23

Accepted Paper Series