Strange Bedfellows: How the Need for Good Governance Shapes Budgetary Control of Bureaucracy

Abstract

Legislators can benefit from delegation to executive agencies, but they have limited tools to hold these agencies accountable. One key tool is power of the purse: control of the agency's appropriations. We present a theory that incorporates heterogeneous legislator preferences over bureaucratic activity, legislative budgetary control, and endogenous bureaucratic policy discretion to understand legislative incentives when appropriating funds to bureaucratic agencies. Our theory provides several insights: first, legislators' induced preferences over budgets are only partially determined by their policy preferences. Second, in some cases legislators who are opposed to the direction that the agency will take policy nevertheless support increased funding for that agency. Finally, "strange bedfellows" coalitions emerge in which legislators with competing policy preferences may nonetheless agree on their most-desired budget level for the agency.

Keywords: Appropriations, Bureaucracy, Congress, Governance, Formal Theory