Collegiality and efficiency in bureaucracy
| Published date | 01 October 2023 |
| DOI | http://doi.org/10.1177/09520767221093878 |
| Author | Mats A Bergman,Annika Fredén |
| Date | 01 October 2023 |
| Subject Matter | Articles |
Article
Public Policy and Administration
2023, Vol. 38(4) 492–511
© The Author(s) 2022
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DOI: 10.1177/09520767221093878
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Collegiality and efficiency in
bureaucracy
Mats A Bergman
1
School of Social Sciences, S¨
odert¨
orn University - Stockholm, Huddinge, Sweden
Annika Fred´
en
2
Department of Political Science, Lund University, Lund, Sweden
Abstract
This article addresses the relation between the design of regulatory agencies and effi-
ciency, arguing that authority concentrated to a single individual outperforms more
collegial decision-making when the regulated firms’interests are aligned. The tentative
explanation is that concentrated leadership reduces the risk for capture. This argument is
developed from an empirical case on the markets for mobile and fixed broadband. In the
mobile market, the regulated firms are similarly positioned, whereas in the fixed
broadband market, the firms typically have adversarial positions, with an incumbent being
challenged by entrants. A statistical analysis of regulatory agencies in 33 European
countries lends support to the argument that regulation of mobile broadband benefits
from having a single decision-maker whereas a bureaucratic regulation with more col-
legiality functions as well for the fixed broadband.
Keywords
Decisionmaking, governance, regulation
Introduction
The regulatory agency is a rather newly established but increasingly important institution
that concerns, for example, competition law, food regulation, and infrastructure (Majone,
1994;Glaeser and Shleifer, 2003). The regulatory agencies steer some markets that in
Corresponding author:
Annika Fred´
en, Political Science, Lund University, Department of Political Science, Box 52, Lund 221 00,
Sweden.
Email: annika.freden@svet.lu.se
Europe used to be managed through state ownership, such as telecommunication, and
some markets that did not previously have political regulation, such as medical drugs. The
political-economic hybrid character of the regulatory authority implies that its tasks
exhibit logics that are usually associated with democracy (such as equity) as well as
markets (efficiency and technical progress). Although the phenomenon is examined in
some previous research (Wassum and De Francesco, 2020;Koop and Hanretty, 2018;
Gilardi, 2008), some key regulatory-design aspects appear to be missing in the discussion
of which steering strategies are the most successful in this context. This article scrutini zes
the regulatory authority from an institutional-design point of view and conjecture that the
relative merits of concentrated directional leadership, on the one hand, and collegiality, on
the other, depend on the specific structure of the regulated market.
The argument in this article is that a forceful regulator, underpinned by decision-
making concentrated to an individual, is particularly beneficial in markets where the
regulated firms’interests are aligned, i.e. where the firms are similarly positioned so that
the information provided to the regulator tends to be biased in a direction that serves the
purpose of the firms. In a market where the regulated firms have opposing interests and
hence more adversarial positions, a richer set of facts and arguments will be presented to
the regulator and the need for the authority to engage in fact-finding is reduced. Instead,
diversity of standpoints from multiple board members may afford the regulator a more
complete view of the situation. The regulatory agencies will therefore be able to achieve
outcomes that benefit the public even though the regulator itself acts less forcefully than
would an assertive single decision-maker. In contrast, in markets with more convergent
interests, this kind of consultation will be less revealing, and the advantage of being able
to take strong directional action is more crucial to limit the influence of special interests.
We use empirical evidence, including some exclusive data, from a relatively new
public service, retail broadband, to substantiate our conjecture. The broadband market is
relevant since it has two main segments, for fixed and mobile broadband, respectively, and
since a key difference between the two segments is the extent to which the dominant firms
have aligned interests. Mobile broadband is a market with rivalry between a small set of
firms, whose interests, at least vis-`
a-vis the regulator, are largely aligned. Each operator is
expected to build its own infrastructure for mobile broadband, or to share it on commercial
terms with a rival. In contrast, the market for fixed broadband in Europe is underpinned by
the principle that the dominant firm has to offer rival operators access to its proprietary
infrastructure at regulated prices. This creates a situation where the dominant and its rivals
have opposite interests when it comes to access pricing.
We use data on decision-making regime that comes from a survey sent to regulatory
authorities in Europe. The relationship between board structure and broadband pene-
tration (fraction of all households) is estimated separately for fixed and mobile broadband.
Multiple regression analysis applied to the data supports the argument that Director
General decision-making is associated with greater mobile broadband penetration, under
control for the nature of the judicial system and socio-economic factors. In contrast, no
such effect can be established for fixed broadband markets. Our analysis thus emphasizes
the relationship between the market structure and decision-making in the public ad-
ministration or, more generally, between the strategic context in which the authority
Bergman and Fred´
en 493
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