Association for Public Policy Analysis & Management

What is the effect of a decrease in statutory discretion on agency loss between the legislature and the bureaucracy? Prominent works in the bureaucracy literature assume that a decrease in statutory discretion, an increase in the number and detail of a program’s procedures in statute, will result in a decrease in agency loss. However, we have yet to empirically verify this assumption. I argue that a decrease in statutory discretion results in a decrease in agency loss. If the legislature is willing to grant less statutory discretion to the bureaucracy, the bureaucrats must implement a program in accordance with procedures that advance legislative intent and, ultimately, decrease agency loss. I empirically test this argument using standard and recent quantitative measures of statutory discretion. The findings demonstrate a positive relationship between statutory discretion and agency loss, which provides face validity for this fundamental assumption in the bureaucratic politics literature.