Ex Post Review and Expert Policy Making: When Does Oversight Reduce Accountability?

Abstract

Ex post review is a common feature of policymaking institutions. We consider a simple environment in which an expert agent makes a policy recommendation, which can then be accepted or rejected by a principal whose policy goals differ from those of the agent. The theory offers testable predictions about policy recommendations and the principal’s acceptance or rejection of these recommendations. The theory suggests that behavior and institutional design incentives are sensitive to both actors’ preference alignment and the importance of and uncertainty inherent to the policy area in multiple ways, some expected and some less obvious. We characterize the types of situations in which ex post review creates incentives for the agent to make pathological policy choices. In these situations, ex post review can reduce the accountability of the agent to the wishes of the principal and ultimately create an incentive for the principal to forego review entirely.

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