Ideology and Performance in Public Organizations

50 Pages Posted: 12 Apr 2021 Last revised: 7 May 2021

Date Written: April 2021

Abstract

We combine personnel records of the United States federal bureaucracy from 1997-2019 with administrative voter registration data to study how ideological alignment between politicians and bureaucrats affects the personnel policies and performance of public organizations. We present four results. (i) Consistent with the use of the spoils system to align ideology at the highest levels of government, we document significant partisan cycles and substantial turnover among political appointees. (ii) By contrast, we find virtually no political cycles in the civil service. The lower levels of the federal government resemble a "Weberian" bureaucracy that appears to be largely protected from political interference. (iii) Democrats make up the plurality of civil servants. Overrepresentation of Democrats increases with seniority, with the difference in career progression being largely explained by positive selection on observables. (iv) Political misalignment carries a sizeable performance penalty. Exploiting presidential transitions as a source of "within-bureaucrat" variation in the political alignment of procurement officers over time, we find that contracts overseen by a misaligned officer exhibit cost overruns that are, on average, 8% higher than the mean overrun. We provide evidence that is consistent with a general "morale effect," whereby misaligned bureaucrats are less motivated.

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Suggested Citation

Spenkuch, Jörg L. and Teso, Edoardo and Xu, Guo, Ideology and Performance in Public Organizations (April 2021). NBER Working Paper No. w28673, Available at SSRN: https://ssrn.com/abstract=3824556

Jörg L. Spenkuch (Contact Author)

Northwestern University - Department of Managerial Economics and Decision Sciences (MEDS) ( email )

2001 Sheridan Road
Evanston, IL 60208
United States

HOME PAGE: http://jspenkuch.github.io

Edoardo Teso

Northwestern University - Department of Managerial Economics and Decision Sciences (MEDS) ( email )

2001 Sheridan Road
Evanston, IL 60208
United States

Guo Xu

University of California, Berkeley - Haas School of Business ( email )

545 Student Services Building, #1900
2220 Piedmont Avenue
Berkeley, CA 94720
United States

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