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Administrative agencies: Administrative agencies are government bodies authorized to implement legislative directives by developing and enforcing regulations, adjudicating disputes, and providing services. See also Administration.
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Annotation: The above characterizations of concepts are neither definitions nor exhausting presentations of problems related to them. Instead, they are intended to give a short introduction to the contributions below. – Lexicon of Arguments.

 
Author Concept Summary/Quotes Sources

Public Choice Theory on Administrative Agencies - Dictionary of Arguments

Parisi I 193
Administrative Agencies/Public choice theory/Farber: (…) in the modern era, at least, legislators often delegate part of the policymaking process to agencies. (…) [it is the question] why legislators might chose to do so rather than making policy themselves, how they decide on the structure of agencies, and what motivations drive administrative action.
Parisi I 194
Delegating: Why do legislators delegate policy decisions to agencies? This question requires little discussion in terms of parliamentary systems, where the executive and legislature usually have identical preferences. It is more complex in presidential systems where the executive and the legislature may have different preferences.
1) One reason for delegation may be to take advantage of the greater expertise of agencies. Delegating power also allows legislators to reduce the transaction costs involved in adding detail to legislation (Stephenson, 2010(1), pp. 286-288).
2) Legislators may prefer not to resolve an issue explicitly even though they do want to address it in some way—which is to say that they prefer a policy lottery to a known outcome (including the status quo). This might occur for several reasons.
a) (…) there could be a cycle among several proposals although each of them is preferred to the status quo. Legislators might prefer a lottery among those proposals if the alternative is to leave the status quo intact.
b) (…) legislators have an incentive to take credit for solving a problem while allowing interest groups the opportunity to shape the ultimate agency action with less public oversight. Of course, rational voters should recognize this incentive and accordingly discount legislator efforts to gain credit through this strategy, so this argument does assume some degree of myopia on the part of voters (Stephenson, 2010(1), pp. 289-292). Cf. >Bureaucracy.
Literature: Levinson, 2005)(2)
Relation between parliament and agencies: Whatever the agency's goals, Congress will take steps to oversee the agency but encounters a principal-agent problem. Because the agency has more expertise, it is hard for Congress to be sure whether the agency is pursuing its own preferences or those congenial to Congress (Gersen, 2010(3), pp. 3337-3388). Hence, the agency will inevitably have some slack to pursue its own objectives. Principal-agent models provide the primary source of guidance in considering this issue (Cooter, 2002(4), ch. 4).


1. Stephenson, M. C. (2010). "Statutory Interpretation by Agencies," in D. A. Farber and A. J. O'Connell, eds., Research Handbook on Public Choice and Public Law, 19—48. Northampton, MA: Edward Elgar.
2. Levinson, D. J. (2005). "Empire-Building Government in Constitutional Law." Harvard Law
Review 118:916-972.
3. Gersen, J. E. (2010). "Designing Agencies," in D. A. Farber and A. J. O'Connell, eds., Research
Handbook on Public Choice and Public Law, 3 33—361. Northampton, MA: Edward Elgar.
4. Cooter, R. D. (2002). The Strategic constitution. Princeton, NJ: Princeton University Press.


Farber, Daniel A. “Public Choice Theory and Legal Institutions”. In: Parisi, Francesco (ed) (2017). The Oxford Handbook of Law and Economics. Vol 1: Methodology and Concepts. NY: Oxford University Press


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Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments
The note [Concept/Author], [Author1]Vs[Author2] or [Author]Vs[term] resp. "problem:"/"solution:", "old:"/"new:" and "thesis:" is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition.
Public Choice Theory
Parisi I
Francesco Parisi (Ed)
The Oxford Handbook of Law and Economics: Volume 1: Methodology and Concepts New York 2017


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