Bureaucratic Synergies

• In Event: Bureaucracy in International Relations III: Bureaucratic Capacity

Abstract

Governments frequently delegate authority to different bureaucracies to promote their country’s economic activities abroad. We theorize whether these bureaucratic efforts complement each other or might serve as substitutes. To adjudicate between these conjectures, we compile novel data from two American bureaucracies – its diplomatic corps (ambassadorial postings) and export-import (EXIM) bank. Using detailed loan-level data, we demonstrate that the EXIM bank is more likely to approve a loan (for private firms to conduct commerce abroad) when there is an ambassadorial vacancy; a finding, we contend, is consistent with a substitution effect. More generally, our paper helps our understanding of how the public sector bridges its interaction with the private sector.

Authors

• Faisal Z. Ahmed, Wellesley College

• Jonas Bunte, Vienna University of Economics and Business