THESIS
2020
Abstract
A long tradition of intellectual thought from Max Weber views an ideal bureaucracy as a
completely rule-based system and regards discretion in allocating government positions
detrimental to performance due to favoritism and corruption. But the net effect of
discretionary appointment compared to a rule-based one is ambiguous in theory and
lacking in systematic evidence. We study how discretionary appointment affects talent
allocation and governance performance in China’s imperial bureaucracy during the “High
Qing” era. Exploiting an abrupt change in the appointment method of prefecture governors,
we show that discretionary appointments improve the quality of governors and lead to an
increase in public goods provision and a reduction in social unrest. Moreover, we find a
large he...[
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A long tradition of intellectual thought from Max Weber views an ideal bureaucracy as a
completely rule-based system and regards discretion in allocating government positions
detrimental to performance due to favoritism and corruption. But the net effect of
discretionary appointment compared to a rule-based one is ambiguous in theory and
lacking in systematic evidence. We study how discretionary appointment affects talent
allocation and governance performance in China’s imperial bureaucracy during the “High
Qing” era. Exploiting an abrupt change in the appointment method of prefecture governors,
we show that discretionary appointments improve the quality of governors and lead to an
increase in public goods provision and a reduction in social unrest. Moreover, we find a
large heterogeneity on the benefits and costs of discretion among different senior
appointers, suggesting whether discretionary appointments are favorable or harmful
depends on the extent to which the incentive of the decision maker is aligned with the
organizational performance.
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