Introduction

The existence and extent of competition within organizations - whether public or private (corporate) bureaucracies - is clearly of fundamental importance. In the literature on corporations, there appear to be two classes of models. In one class are those models that postulate competition; in the other are those that (implicitly or explicitly) ignore it completely. Models that ignore competition among bureaucrats (called “managers” in that literature) explain corporate behavior as based solely on the interests of these bureaucrats or managers and lead to fears of excessive growth and power in the corporate sector of the economy. One well-known writer in this tradition visualizes the entire economy as if it were a single giant corporation. On the other hand, models that postulate competition among managers lead to the easy dismissal of these fears and to an understanding of the growth of the corporate sector as prima facie evidence of its efficiency rather than just a lurid reflection of managers' interest in that growth.

Turning to the literature on governmental bureaucracy, we find a conspicuous absence of the counter-accusations characteristic of the debates over corporate power. Instead, we find models based single-mindedly on the monopoly assumption. All the theories of public bureaucracy put forward to date assume that bureaucrats are monopolists. Sometimes the monopoly assumption is explicitly made, as in Niskanen's work or in that of Migué and Bélanger.