All law is relatively coarse after its initial implementation as the legislature cannot foresee all contingencies that can arise in the actual application of the law. Therefore, decisions need to be made by street-level administrators as novel and particular circumstances arise. Economists have largely ignored the political science literature on street-level bureaucrats, such as policemen, welfare case managers, or regulatory agents. I present a case study in the context of market entry regulation in Germany. Qualitative and quantitative evidence suggests that bureaucratic discretion exists, that is, administrative actions can be found on different ends of a decision space, and that its effects are potentially large. Administrators do not apply legislation in a uniform manner and we observe a systematically different application of rules across subnational jurisdictions.

One of the central lessons taken from the work of Michael Lipsky on street level bureaucracies is that street level bureaucrats make policy. Two resulting broad public policy concerns are the impact of street level decision making on public policy and the impact on citizens’ access to public services. This article reports on a study of the views of Ontario Works’ case managers on the nature of bureaucratic discretion in the setting of a highly rule bound provincial income assistance programme in Canada. The focus of this article is on case managers’ interaction with contradictory and complex policy directives. An argument is developed that in such a restrictive policy setting, meeting the goals of unswerving policy implementation and citizen access to public services may work at cross purposes.