Hostname: page-component-586b7cd67f-rdxmf Total loading time: 0 Render date: 2024-11-26T08:56:14.193Z Has data issue: false hasContentIssue false
  • English
  • Français

When Reporting Undermines Performance: The Costs of Politically Constrained Organizational Autonomy in Foreign Aid Implementation

Published online by Cambridge University Press:  27 September 2018

Dan Honig
Get access

Abstract

Bureaucracies with field operations that cannot be easily supervised and monitored by managers are caught between two sources of dysfunction that may harm performance. The first source of dysfunction is straightforward: field workers can use operating slack and asymmetric information to their own advantage, thwarting an organization's objectives. The second source of dysfunction is often overlooked: attempts to limit workers’ autonomy may have deleterious effects, curbing agents’ ability to respond efficaciously to the environment. I find that the parliaments and executive boards to whom International Development Organizations (IDOs) are accountable differentially constrain IDO organizational autonomy, which in turn affects management's control of field agents. Tight management control of field agents has negative effects, particularly in more unpredictable environments. Attempts by politicians to constrain organizations in an effort to improve performance can sometimes be self-undermining, having net effects opposite those intended.

Type
Research Article
Information
International Organization , Volume 73 , Issue 1 , Winter 2019 , pp. 171 - 201
Copyright
Copyright © The IO Foundation 2018 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

I thank the National Science Foundation Graduate Research Fellowship for its support under grant #DGE-1144152. Matt Andrews, Sam Asher, Nancy Birdsall, Mark Buntaine, Andreas Fuchs, Peter Hall, Conor Hartman, Bob Keohane, Chris Kilby, Steve Knack, Aart Kraay, Jane Mansbridge, Sheila Page, Woody Powell, Lant Pritchett, Simon Quinn, Steve Radelet, Tristan Reed, Alasdair Roberts, Bill Savedoff, Evan Schofer, Ryan Sheely, Beth Simmons, Vivek Srivastava, Martin Steinwand, Mike Tierney, Dustin Tingley, Eric Werker, Michael Woolcock, anonymous reviewers at IO, and many others have all provided helpful comments on earlier versions of these ideas and/or this work. Many thanks to Yi Yan, Smriti Sakhamuri, Grace Chao, Kyle Kessler, and the World Bank Archives staff (particularly Sherrine Thompson) for their research assistance. I thank the European Commission, the UK's Department for International Development, the Asian Development Bank, the Global Fund for AIDS, Tuberculosis, and Malaria, and the German Development Bank for providing data. Because World Bank data used in this analysis are publicly available the World Bank deserves perhaps the greatest thanks. Data for the Japanese International Cooperation Agency (JICA), the German Society for International Cooperation (GiZ), and the International Fund for Agricultural Development were assembled from individual project-completion reports by Odesk-contracted research assistants under my supervision, with the compiled data then sent back to the originating agency for comment and/or correction. GiZ was kind enough to respond with corrections, which were incorporated; these data were generated by me rather than by JICA and JICA is not responsible for them. The case studies would not have been possible without the hundreds of hours spent by a diverse group of interviewees listed in the online appendix who talked to me and answered odd questions, for which I am very grateful.

References

Aghion, Philippe, Bloom, Nicholas, Lucking, Brian, Sadun, Raffaella, and Reenen, John Van. 2017. Turbulence, Firm Decentralization and Growth in Bad Times. NBER Working Paper 23354.Google Scholar
Aghion, Philippe, and Tirole, Jean. 1997. Formal and Real Authority in Organizations. Journal of Political Economy 105 (1):1–29.Google Scholar
Axelrod, Robert. 1984. The Evolution of Cooperation. New York: Basic Books.Google Scholar
Barnett, Michael N., and Finnemore, Martha. 2003. The Politics, Power, and Pathologies of International Organizations. International Organization 53 (4):699–732.Google Scholar
Bozeman, Barry, and Kingsley, Gordon. 1998. Risk Culture in Public and Private Organizations. Public Administration Review 58 (2):109–18.Google Scholar
Brehm, John O., and Gates, Scott. 1999. Working, Shirking, and Sabotage: Bureaucratic Response to a Democratic Public. Ann Arbor: University of Michigan Press.Google Scholar
Buntaine, Mark T. 2016. Giving Aid Effectively: The Politics of Environmental Performance and Selectivity at Multilateral Development Banks. New York: Oxford University Press.Google Scholar
Buntaine, Mark T., Parks, Bradley C., and Buch, Benjamin P.. 2017. Aiming at the Wrong Targets: The Domestic Consequences of International Efforts to Build Institutions. International Studies Quarterly 61 (2):471–88.Google Scholar
Bush, Sarah Sunn. 2015. The Taming of Democracy Assistance: Why Democracy Promotion Does Not Confront Dictators. Cambridge, UK: Cambridge University Press.Google Scholar
Calvert, Randall, McCubbins, Mathew, and Weingast, Barry. 1989. A Theory of Political Control and Agency Discretion. American Journal of Political Science 33 (3):588–611.Google Scholar
Cameron, A. Colin, Gelbach, Jonah, and Miller, Douglas L.. 2006. Robust Inference With Multi-Way Clustering. NBER Technical Working Paper 327. Cambridge, MA.Google Scholar
Carpenter, Daniel P. 2001. The Forging of Bureaucratic Autonomy: Reputations, Networks, and Policy Innovation in Executive Agencies, 1862–1928. Princeton, NJ: Princeton University Press.Google Scholar
Carpenter, Daniel P. 2010. Reputation and Power: Organizational Image and Pharmaceutical Regulation at the FDA. Princeton, NJ: Princeton University Press.Google Scholar
Center for Systemic Peace. 2014. State Fragility Index. Conflict, Governance, and State Fragility. Available at <www.systemicpeace.org/vlibrary/GlobalReport2014.pdf>..>Google Scholar
Chandler, Alfred D. 1977. The Visible Hand: the Managerial Revolution in American Business. Cambridge, MA: Belknap Press.Google Scholar
Clist, Paul. 2016. Payment by Results in Development Aid: All That Glitters Is Not Gold. The World Bank Research Observer 31 (2): 290–319.Google Scholar
De Weijer, Frauke. 2012. Rethinking Approaches to Managing Change in Fragile States. Center for International Develoment, Research Fellow and Graduate Student Working Paper No. 58. Harvard University.Google Scholar
DFID. 2010. Working Effectively in Conflict-affected and Fragile Situations (Briefing Paper H: Risk Management). DFID Briefing Paper March 2010. Available at <https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/67697/building-peaceful-states-H.pdf>..>Google Scholar
Dunleavy, Patrick, and Hood, Christopher. 1994. From Old Public Administration to New Public Management. Public Money and Management 14 (3):9–16.Google Scholar
Gailmard, Sean, and Patty, John W.. 2007. Slackers and Zealots: Civil Service, Policy Discretion, and Bureaucratic Expertise. American Journal of Political Science 51 (4):873–89.Google Scholar
Gailmard, Sean, and Patty, John W.. 2012. Learning While Governing: Expertise and Accountability in the Executive Branch. Chicago: University of Chicago Press.Google Scholar
Garicano, Luis, and Rayo, Luis. 2016. Why Organizations Fail: Models and Cases. Journal of Economic Literature 54 (1):137–92.Google Scholar
Gelb, Alan, and Hashmi, Nabil. 2014. The Anatomy of Program-for-Results: An Approach to Results-Based Aid. Working Paper.Google Scholar
Ghani, Ashraf, Lockhart, Clare, and Carnahan, Michael. 2005. Closing the Sovereignty Gap: An Approach to State-Building. Overseas Development Institute. Available at <https://www.odi.org/resources/docs/2482.pdf>..>Google Scholar
Gilardi, Fabrizio. 2002. Policy Credibility and Delegation to Independent Regulatory Agencies: A Comparative Empirical Analysis. Journal of European Public Policy 9 (6):873–93.Google Scholar
Government of the United Kingdom. 2002. International Development Act 2002.Google Scholar
Government of the United Kingdom. 2006. International Development (Reporting and Transparency) Act 2006.Google Scholar
Government of the United Kingdom. 2014. International Development (Gender Equality) Act 2014.Google Scholar
Government of the United Kingdom. 2015. International Development (Official Development Assistance Target) Act 2015.Google Scholar
Grossman, Sanford J., and Hart, Oliver D.. 1986. The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration. Journal of Political Economy 94 (4):691–719.Google Scholar
Gulrajani, Nilima. 2011. Transcending the Great Foreign Aid Debate: Managerialism, Radicalism and the Search for Aid Effectiveness. Third World Quarterly 32 (2):199–216.Google Scholar
Gulrajani, Nilima. 2017. Bilateral Donors and the Age of the National Interest: What Prospects for Challenge by Development Agencies? World Development 96:375–89.Google Scholar
Hart, Oliver, and Moore, John. 1988. Incomplete Contracts and Renegotiation. Econometrica: Journal of the Econometric Society 56 (4):755–85.Google Scholar
Hart, Oliver, and Moore, John. 1990. Property Rights and the Nature of the Firm. Journal of Political Economy 98 (6):1119–58.Google Scholar
Hawkins, Darren G., and Jacoby, Wade. 2006. How Agents Matter. In Delegation and Agency in International Organizations, edited by Hawkins, Darren G., Lake, David A., Nielson, Daniel L., and Tierney, Michael J., 199–228. New York: Cambridge University Press.Google Scholar
Hawkins, Darren G., Lake, David A., Nielson, Daniel L., and Tierney, Michael J.. 2006. Delegation Under Anarchy: States, International Organizations, and Principal-Agent Theory. In Delegation and Agency in International Organizations, edited by Hawkins, Darren G., Lake, David A., Nielson, Daniel L., and Tierney, Michael J., 3–38. New York: Cambridge University Press.Google Scholar
Hölmstrom, Bengt. 1979. Moral Hazard and Observability. Bell Journal of Economics 10 (1):74–91.Google Scholar
Hölmstrom, Bengt, and Milgrom, Paul. 1991. Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design. Journal of Law, Economics, and Organization 7 (Special Issue):24–52.Google Scholar
Honig, Dan. 2018. Navigation by Judgment: Why and When Top-Down Control of Foreign Aid Doesn't Work. New York: Oxford University Press.Google Scholar
Hood, Christopher. 2004. The Middle Aging of New Public Management: Into the Age of Paradox? Journal of Public Administration Research and Theory 14 (3):267–82.Google Scholar
Huber, John D., and McCarty, Nolan. 2004. Bureaucratic Capacity, Delegation, and Political Reform. American Political Science Review 98 (3):481–94.Google Scholar
Huber, John D., and Shipan, Charles R.. 2002. Deliberate Discretion: The Institutional Foundations of Bureaucratic Autonomy. New York: Cambridge University Press.Google Scholar
Huber, John D., and Shipan, Charles R.. 2006. Politics, Delegation, and Bureaucracy. In The Oxford Handbook of Political Economy, edited by Weingast, Barry R. and Wittman, Donald A., 256–72. New York: Oxford University Press.Google Scholar
Hupe, Peter, and Hill, Michael. 2007. Street-Level Bureaucracy and Public Accountability. Public Administration 85 (2):279–99.Google Scholar
Johns, Leslie. 2007. A Servant of Two Masters: Communication and the Selection of International Bureaucrats. International Organization 61 (2):245–75.Google Scholar
Johnson, Tana, and Urpelainen, Johannes. 2014. International Bureaucrats and the Formation of Intergovernmental Organizations: Institutional Design Discretion Sweetens the Pot. International Organization 68 (1):177–209.Google Scholar
Kauppi, Katri, and Van Raaij, Erik M.. 2015. Opportunism and Honest Incompetence—Seeking Explanations for Noncompliance in Public Procurement. Journal of Public Administration Research and Theory 25 (3):953–79.Google Scholar
Keiser, Lael R. 1999. State Bureaucratic Discretion and the Administration of Social Welfare Programs: The Case of Social Security Disability. Journal of Public Administration Research and Theory 9 (1):87–106.Google Scholar
Kerr, Steven. 1975. On the Folly of Rewarding A, While Hoping for B. Academy of Management Journal 18 (4):769–83.Google Scholar
Lipsky, Michael. 1980. Street-Level Bureaucracy: Dilemmas of the Individual in Public Services. N.p.: Russell Sage Foundation.Google Scholar
Lynn, Laurence E. Jr. 1998. The New Public Management: How to Transform a Theme into a Legacy. Public Administration Review 58 (3):231–37.Google Scholar
Martin, Lisa. 2006. Distribution, Information, and Delegation to International Organizations: The Case of IMF Conditionality. In Delegation and Agency in International Organizations, edited by Hawkins, Darren G., Lake, David A., Nielson, Daniel L., and Tierney, Michael J., 140–64. New York: Cambridge University Press.Google Scholar
Meyer, John W., and Rowan, Brian. 1977. Institutionalized Organizations: Formal Structure as Myth and Ceremony. American Journal of Sociology 83 (2):340–63.Google Scholar
Modell, S. 2004. Performance Measurement Myths in the Public Sector: A Research Note. Financial Accountability and Management 20 (1):39–56.Google Scholar
Natsios, A. 2010. The Clash of the Counter-bureaucracy and Development. Center for Global Development, 1 July. Washington, DC. Available at <https://www.cgdev.org/publication/clash-counter-bureaucracy-and-development>..>Google Scholar
Nielson, Daniel L., and Tierney, Michael J.. 2003. Delegation to International Organizations: Agency Theory and World Bank Environmental Reform. International Organization 57 (2):241–76.Google Scholar
Oliver, Christine. 1991. Strategic Responses to Institutional Processes. Academy of Management Review 16 (1):145–79.Google Scholar
Organisation for Economic and Cultural Develepment (OECD). 1991. The DAC Principles for the Evaluation of Development Assistance. Available at <https://www.oecd.org/development/evaluation/2755284.pdf>..>Google Scholar
Organisation for Economic and Cultural Develepment (OECD). 2000. DAC Criteria for Evaluating Development Assistance Factsheet: 2. Available at <https://datacatalog.worldbank.org/dataset/world-bank-projects-operations>..>Google Scholar
Organisation for Economic and Cultural Develepment (OECD). 2005. The Paris Declaration on Aid Effectiveness. Paris. Available at <http://www.oecd.org/dataoecd/11/41/34428351.pdf>..>Google Scholar
Organisation for Economic and Cultural Develepment (OECD). 2012. Aid Effectiveness 2011: Progress in Implementing the Paris Declaration. Paris: OECD.Google Scholar
Organisation for Economic and Cultural Develepment (OECD). 2016. OECD Development Co-operation Peer Reviews: United States 2016. Paris: OECD.Google Scholar
Pepinsky, Thomas B., Pierskalla, Jan H., and Sacks, Audrey. 2017. Bureaucracy and Service Delivery. Annual Review of Political Science 20:249–68.Google Scholar
Perakis, Rita, and Savedoff, William. 2015. Does Results-Based Aid Change Anything? Pecuniary Interests, Attention, Accountability and Discretion in Four Case Studies. CGD Policy Paper.Google Scholar
Pfeffer, Jeffrey, and Salancik, Gerald R.. 1978. The External Control of Organizations: A Resource Dependence Perspective. New York: Harper and Row.Google Scholar
Polanyi, Michael. 1966. The Tacit Dimension. Chicago: University of Chicago Press.Google Scholar
Prendergast, Canice. 2001. Selection and Oversight in the Public Sector, with the Los Angeles Police Department as an Example. National Bureau of Economic Research, Working Paper 8664. Available at <http://www.nber.org/papers/w8664>..>Google Scholar
Rasul, Imran, and Rogger, Daniel. 2016. Management of Bureaucrats and Public Service Delivery: Evidence from the Nigerian Civil Service. The Economic Journal 28 (608):413–46.Google Scholar
Scott, James C. 1998. Seeing Like a State: How Certain Schemes to Improve the Human Condition Have Failed. New Haven, CT: Yale University Press.Google Scholar
Shavell, Steven. 1979. Risk Sharing and Incentives in the Principal and Agent Relationship. Bell Journal of Economics 10 (1):55–73.Google Scholar
Singh, Jitendra V. 1986. Peformance, Slack, and Risk Taking in Organizational Decision Making. Academy of Management Journal 29 (3):562–85.Google Scholar
Stein, Jeremy C. 2002. Information Production and Capital Allocation: Decentralized Versus Hierarchical Firms. The Journal of Finance 57 (5):1891–921.Google Scholar
Swedlund, Haley J. 2017. Can Foreign Aid Donors Credibly Threaten to Suspend Aid? Evidence from a Cross-National Survey of Donor Officials. Review of International Political Economy 24 (3):454–96.Google Scholar
Tirole, Jean. 1994. The Internal Organization of Government. Oxford Economic Papers 46 (1):1–29.Google Scholar
US Congress Committee on International Relations, and US Congress Committee on Foreign Relations. 2003. Legislation on Foreign Relations Through 2002. Available at <https://pdf.usaid.gov/pdf_docs/pcaab142.pdf>..>Google Scholar
USAID. 2014. Public Financial Management Risk Assessment Framework (PFMRAF) Manual: A Mandatory Reference for ADS Chapter 220. Available at <https://www.usaid.gov/sites/default/files/documents/1868/220mae.pdf>..>Google Scholar
Williamson, Oliver E. 1983. Markets and Hierarchies: Analysis and Antitrust Implications. New York: Free Press.Google Scholar
Wilson, James Q. 1989. Bureaucracy: What Government Agencies Do and Why They Do It. New York: Basic Books.Google Scholar
Woods, Ngaire. 2006. The Globalizers: The IMF, the World Bank, and their Borrowers. Ithaca, NY: Cornell University Press.Google Scholar
World Bank. 2006. Engaging with Fragile States: An IEG Review of World Bank Support to Low-income Countries Under Stress. Washington, DC: World Bank Publications.Google Scholar
World Bank. 2017. World Bank Projects and Operations Database. Available at <https://datacatalog.worldbank.org/dataset/world-bank-projects-operations>..>Google Scholar
Wynen, Jan, and Verhoest, Koen. 2016. Why Do Autonomous Public Agencies Use Performance Management Techniques? Revisiting the Role of Basic Organizational Characteristics. International Public Management Journal doi: 10.1080/10967494.2016.1199448.Google Scholar
Supplementary material: File

Honig supplementary material

Honig supplementary material 1

Download Honig supplementary material(File)
File 1.5 MB
Supplementary material: File

Honig supplementary material

Honig supplementary material 2

Download Honig supplementary material(File)
File 3.7 MB