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Von Mises analyzed Bureaucracy in a book aptly named (in English translation): Bureaucracy. Bureaucracy is a mechanism used to control costs in an enterprise a
by sageikosa 14y ago
Von Mises analyzed Bureaucracy in a book aptly named (in English translation): Bureaucracy. Bureaucracy is a mechanism used to control costs in an enterprise absent measurable economic profitability (cost/revenue efficiency). In private profit-seeking enterprises with sufficient scale to have division of labor, subsets of the organization may be deemed "cost centers", these are the ones that get the most bureaucratic over time. Even regulatory compliance departments main goal is to constrain the costs of fines from non-compliance.
The omni-present danger in bureaucratic management is that the mechanisms to maintain and manage the bureaucracy are themselves non-profit seeking, and tend to motivate growth in the bureaucracy. In private enterprises (barring regulatory compliance requirements), the overall cost of its bureaucratic functions impedes its profitability, and should tend to limit the size of the "cost center" budgets to maintain market profitability (or a failed enterprise).
For government functions, the overall cost of the bureaucracy can only be paid for by tax receipts and public debt (and license and fines, which as the Chief Justic pointed out are effectively tax receipts). If there is no political will to constrain one of both of those, the bureaucracy will grow unbounded.
Anyway, the short of it has nothing to do with marshaling resources, it has to do with constraining costs absent profit.