bureaucracy: is it efficient? is it not? is that the question?: uncertainty reduction: an ignored...

DOI: 10.1177/0095399702239171ARTICLEADMINISTRATION & SOCIETY / January 2003Gajduschek / BUREAUCRATIC RATIONALITYMost contemporary scholars regard bureaucracy as an inefficient phenomenon. At the sametime, we may find a great number of bureaucratic organizations in the various social spheres.Max Weber, who introduced the concept of bureaucracy into the social sciences, however,was convinced that bureaucracy is superior to any other organizational form and explainedits prevalence by the immanent rationality of bureaucratic organizations. In analyzingWeber’s text, the author argues that Weber was mistranslated into English and then misinter-preted. Weber’s term rationality is not at all identical to efficiency. Rationality includes alsouncertainty reduction regarding internal organizational procedures as well as outputs. Un-certainty reduction may induce several advantages, which, in several cases, ensure organi-zational superiority.

BUREAUCRACY: IS IT EFFICIENT?IS IT NOT? IS THAT THE QUESTION?Uncertainty Reduction: An IgnoredElement of Bureaucratic Rationality

GYORGY GAJDUSCHEKHungarian Institute of Public Administration

Social sciences differ greatly from natural sciences. The lack of a widelyaccepted methodology and the lack of opportunity to test various hypothe-ses by experiments in social sciences are perhaps the most frequently citeddifferences. For that reason, several models referring to the same phenom-enon frequently coexist without a chance to rigorously test these modelsagainst one another and reality.

This feature of social sciences can be traced especially well in the caseof bureaucracy. The term is interpreted very diversely among branches ofsocial sciences and even among authors within one branch, such as sociol-ogy of organizations, political science, and so forth. Most of these diverg-ing interpretations can be traced back to one author, to Max Weber, and to

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his concept of bureaucracy. Weber saw bureaucracy as the most rationalorganizational form and thus as superior to any other form of organiza-tions. Subsequent authors, however, found that bureaucracy is far frombeing perfectly efficient. On the contrary, several scholars concluded thatbureaucracy is overly inefficient.

In the first part of this article, I will briefly sum up the variousapproaches to the bureaucratic phenomenon. I attempt to depict how thedifferent approaches converge to a very similar conclusion, to the—partialor complete—inefficiency of bureaucratic organizations. Then, I contrastthe inefficiency theorem with a simple fact, namely, that bureaucraticorganizations are predominant in several social spheres. If efficiency iscrucial for the prevalence of any organizational form and if bureaucracy isinefficient, how could it prevail? The predictive power of Weber’s theoryat this point seems better than that of the later elaborated and usually moresophisticated theories. In the next part of the article, I analyze Weber’s textto find an answer for the prevalence of bureaucratic organizations. In myview, this attribute of bureaucracy is what I call uncertainty reduction. I tryto prove that this attribute is embedded in the Weberian term rationality.Finally, I attempt to briefly summarize how uncertainty reduction mayensure the superiority and the prevalence of bureaucratic organizationsunder certain circumstances and in certain social spheres, like publicadministration in modern societies.

HOW DO SOCIAL SCIENCESCONCEIVE BUREAUCRACY?

Although the term bureaucracy can be traced back to the mid-18th cen-tury (Albrow, 1970, p. 16), the concept was introduced into the social sci-ences by Max Weber. Seemingly, Weber and his findings had relatively lit-tle impact on the social sciences until his work—or, to be more accurate, someparts of it—were translated into English by H. H. Gerth and C. WrightMills (Weber, 1947) as well as by Talcott Parsons (Weber, 1947/1966).Besides the publications of the above-mentioned translations, Robert K.Merton (1968) also had his part in the dissemination of Weber’s concept ofbureaucracy. Here, we are primarily interested in the concept of bureau-cracy as describing a certain organizational form.

The authors who relied on or referred to Weber’s notion of bureaucracynecessarily reconstructed and reinterpreted the concept and, to a greater orlesser extent, Weber’s work generally. It is also natural that the reinterpre-

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tations contained a certain bias toward the interpreter’s own theoreticalstandpoint. Those who referred to the Weberian concept of bureaucracyfrequently also criticized that concept. Not only the interpretations butalso the criticism of Weber’s work differ greatly from author to author andfrom one approach to another.

In the next part of the article, I will classify and briefly analyze the vari-ous approaches. I propose here a dichotomy for the classification of theapproaches toward bureaucracy. I discuss first those approaches that areconcerned with bureaucracy as an organizational phenomenon as a well-defined group of mutually interrelated persons. According to thisapproach, certain features of the personnel, the organizational structure,and procedures define bureaucracy as a type of organization, irrespectiveof the social subsystem in which the organization at hand is present. Orga-nizational theory, organizational behavior and management on one hand,and organizational sociology on the other are the research fields that canbe enlisted under this category.

The second type of approaches can be circumscribed best exactly as anopposite to the above-mentioned class. This second set of approachesregards bureaucracy not as an organizational phenomenon that can befound in several social subsystems but rather as something outside thesphere of market economy or inside the government. Bureaucracy appearshere as a mechanism, a way of functioning driven by forces other thancompetition. The most typically mentioned features of bureaucracy, inthis respect, are hierarchy and rule-based functioning. Economics andpublic choice theory on one hand and political science and public admin-istration on the other hand can be classified within this approach.

BUREAUCRACY AS ANORGANIZATIONAL PHENOMENON

Organizational theory, organizational behavior, and management1 usu-ally identify bureaucracy with the formal-rational organization. Weber’smodel is usually treated as a descriptive version of the Taylorian organiza-tional model based on scientific management. Division of labor, special-ization, strict rules—codifying the one best way—strict subordination,and exclusion of any personal element from the conduct of work are per-haps the most important common elements attributed to Taylor and toFayol (later to Gulick and Urwick, etc.) as well as to Weber (Leivesley,Carr, & Kouzmin, 1994). It is a generally shared opinion of scholars of the

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social sciences that all these authors considered these elements of organi-zation as the ones leading to the highest level of efficiency.

The formal-rational school of management was followed by the humanrelations movement, which proved the presence of personal elements,such as emotions, attitudes, and values, frequently shared by a group ofworkers. The human relations movement pointed out that these factorsgreatly influence organizational efficiency. Furthermore, it pointed to theinappropriate motivation in formal-rational organizations. The findings ofhuman relations questioned the efficiency theorem of the formal-rationalorganizations.

The open system theory of organizations relied not only on the theoret-ical approach but used comparative statistical analysis extensively insearch of characteristics of efficient organizations. They found that orga-nizational success greatly depends on the interaction between organiza-tional environment and internal organizational features. They concludedthat there is no one best way. Organizational efficiency depends on theadequacy of internal organizational features to the demands and condi-tions generated by the organizational environment.

Generally speaking, due to the findings of empirical research and prac-tical experience, no contemporary scholar of organizational theory andmanagement accepts unconditionally that formal-rational organizationsor bureaucracies are able to provide the highest level of efficiency.

The sociology of organizations2 regards the problem of bureaucracy asone of its central topics. Merton (1968) basically accepted the Weberianconcept but pointed to the fact that the internal features may lead to unin-tended dysfunctions, most of all to goal displacement. Other scholarspoint to the inherent contradictions among certain internal features. Themost frequently mentioned contradiction is the one between hierarchy andthe rule of rules on one hand and expertise on the other. The trade-offsbetween specialization and coordination and between quick and reliablecommunication and hierarchy, topics widely discussed among organiza-tional theorists, also appear in organizational sociology (Blau & Meyer,1971; Crozier, 1964; Etzioni, 1964; Simon, 1946). All these theoreticaldifficulties in the Weberian model and its interpretation raised seriousdoubt about the general efficiency of bureaucratic organizations.

Empirical research seemed to support the counterhypothesis. Casestudies as well as sample surveys apparently proved that bureaucracies arefar from always being the most efficient organizations (Blau & Meyer,1971, pp. 79-97; Heydebrand, 1973).




Organizational sociologists and theorists and scholars of managementhave shared a fundamental model in reconstructing Weber. According tothis model, the internal organizational features of bureaucracy—individu-ally and in synergy—lead to a general attribute, namely, the efficiency ofthis type of organization. Efficiency, in turn, ensures superiority over otherorganizational forms. This cause-effect chain can be summed up asfollows3:

Internal features ⇒ General attribute ⇒ Superiority oversuch as division of almost solely con- other organizationallabor, expertise, ceived as organiza- formshierarchy, rule-based tional efficiencyfunctioning, and soforth

Because this scheme represents a cause-effect chain, if one of thecauses is missing, one cannot reasonably expect the effect. For instance,if—as most of the authors argue—internal features do not lead to the gen-eral attribute of efficiency, then we cannot speak about the superiority ofbureaucracy over other organizational forms. In fact, most of the scholarsend up with this negative logical chain and conclude the relative (e.g., thecontingency theory) (Blau & Meyer, 1971; Merton, 1968) or absolute(mostly the human relation theory) (Crozier, 1964) inefficiency ofbureaucracies.

Although there is a common—though hidden—frame for interpretingWeber, there is also great variance among the authors regarding whichinternal features they emphasize, mention, or omit from Weber’s descrip-tion and how they relate these internal features to the general attribute ofefficiency. Furthermore, students of organization greatly differ from oneanother in the usage of the term efficiency, whereas they very rarely definethe term explicitly.

BUREAUCRACY AS ASYSTEM-SPECIFIC MECHANISM

The Weberian model seemed to be inapplicable for those who wantedto base their model on rationally acting individuals, bureaucrats, whosebehavior is driven by individual utility maximization principle (e.g., Cro-zier, 1964; Tullock, 1965). Even in such a strongly controlled organizationas bureaucracy, with its strict hierarchy and rule-governed functioning,




there are significant uncontrolled spheres, where bureaucrats will actaccording to their personal interest and not according to that of the organi-zational goals and rules.

For neoclassical economists, bureaucracy is a synonym for nonmarket(Beetham, 1987, p. 24; Downs, 1966, pp. 29-31; Mises, 1944/1966). It is asystem in which the invisible hand of market does not provide clear andimmediate feedback on the efficiency of activities and outputs and inwhich market forces do not sort out the underperformers. Unlike adher-ents of the previously mentioned approaches, economists do have a cleardefinition of efficiency. If market is the only mechanism that is able to pro-vide perfect efficiency, bureaucracy as a nonmarket system, by definition,is inefficient for neoclassical economics (Beetham, 1987, pp. 27-30;Downs, 1966, pp. 38-40). The primary reason for the existence of bureau-cracy—that is, government in this context—is to correct market failures(Weimer & Vining, 1992, pp. 30-32, 41).

For neoclassical economists, bureaucracy is isolated from the marketand is therefore not part of their field of study. Economists who do not sim-ply neglect or refuse to address bureaucracy but instead address it usingmarket sensibilities are public choice theorists. For instance, Niskanen(1971) set up a few axioms regarding the bureaucrats’ behavior and thespecificity of public bureaucracy and, based on the methodological toolsof neoclassical economics, proved the inefficiency of public bureaucra-cies, that is, government. Others (see Blais & Dion, 1991; Lane, 1987a),while further developing Niskanen’s theory by correcting and generaliz-ing certain points, rarely question his overall conclusion regarding theimmanent inefficiency of bureaucracies.4

Although the approach of economics is really impressing with its clear-cut definition of efficiency and its strict methodology, it raises the problemof the inappropriateness of the method of analysis to the subject analyzed.The methodological set of neoclassical economics has been elaborated (a)for the analysis of the market, first of all for its pure form, the perfectlycompetitive market and (b) where actors pursue solely their own privategoals. Public choice theorists apply this method to the research of a topic,which (a) by their own definition is nonmarket and (b) is supposed to bedriven, and—at least partly—is indeed driven by nonprivate, namely, bypublic, interest (Blais & Dion, 1991, p. 357; Peters, 1995, p. 318).

At least the first part of this problem can be solved by the application ofanother methodology, that of game theory. Game theory points out that insome types of quite typical games, such as the prisoner’s dilemma game,the outcome of the game produced by independently acting,




utility-maximizing individuals is suboptimal. Thus, a mechanism otherthan competition may lead to a superior outcome. In that regard, publicchoice theory may not necessarily deny the efficiency of bureaucracy. Onthe other hand, examining specifically the democratic political process,public choice theorists point out several phenomena that lead tosuboptimality. Because bureaucracy and government are frequently usedas synonyms in these texts, the shortcomings of the democratic processtypically appear as bureaucratic inefficiency (e.g., the texts in Lane,1987a).

Neoclassical economics and game theory share the same axiom. Bothof these approaches are based on the assumption of utility-maximizingindividuals. They presume that individual actors follow their private inter-est and only their private interest. This is the point where the differencebetween these theories on one hand and political science and publicadministration on the other hand can be most easily perceived. It is clearthat no consistent theory can be based solely on the presumption of altruistindividuals. This, however, does not indicate that we must calculate solelyon the basis of personal utility-maximizing individuals. Political scienceand the science of public administration, at least in their classical form,regard public bureaucracy as a group of individuals and/or organizationsthat act on the basis of public interest and public will as articulated in polit-ical decisions and the laws.

Unlike public choice theory, political science strictly differentiatesbetween bureaucracy and government. When political scientists speakabout bureaucracy, they refer only to a set of organizations within theexecutive branch that consists of salaried, permanent personnel, profes-sionals, who act according to the will of their political rulers. Because pol-iticians are supposed to represent the public interest, and bureaucratsimplement the politicians’ orders, bureaucracies serve the public and acton behalf of the public interest. The public interest appears in the laws aswell as in the specific bureaucratic ethos.

Within this general framework, there are several specific features ofbureaucracies, which more or less stem from the inherent logic of modernadministrative conduct and—at the same time—satisfy the stipulations ofmodern political processes. The rule of law (codifying the public interest),hierarchy (with the politician at the top, representing the public interest),impersonality (guaranteeing equality for all citizens), and a merit-basedpersonnel system (guaranteeing impartiality) are perhaps the most impor-tant features.




The standpoint of the classical theory of public administration, thus, isvery close to Weber’s theory. Unlike Weber, however, the political scienceand public administration approach defines—or at least is interested in—bureaucracy solely as a part of the government.

Practical experience as well as empirical research showed, however,that the reality greatly differs from the ideal-classical model of publicadministration. It turned out that bureaucrats and, consequently, bureau-cracies frequently follow their own interest in addition to or at the expenseof that of the public (Blais & Dion, 1991; Tullock, 1965). The expandingrole of bureaucracies in political decision making increasingly providesan opportunity, whereas expertise and the monopoly of information grantthe ability for bureaucracies to replace public interest with that of specificbureaucratic interest (Blais & Dion, 1991; Peters, 1995, pp. 291-294).

At the same time, in the practice of public administration, the problemof efficiency, in terms of output-input relationship, has emerged, espe-cially in the United States. From the turn of the century (Wilson, 1887) andlong after that, increasing efficiency has been identified with increasingbureaucratization. From the 1950s and 1960s on, however, bureaucracystarted to seem to be the problem itself. By the late 1970s, the prescriptionwas ready: Because the problem is bureaucracy, the remedy must bedebureaucratization (Osborne & Gaebler, 1992). Bureaucracies must bereplaced to the greatest possible extent by market mechanisms andnonbureaucratic management techniques applied in private companies.

THE PROBLEM OF EFFICIENCY

As we can see, various approaches provided diverging interpretationsof the term bureaucracy. Almost every element of Weber’s original con-cept has been questioned and/or omitted by one or more authors orschools. Perhaps neoclassical economics and public choice theory wentfurthest in this direction. They abandoned the concept of bureaucracy asone denoting an organizational phenomenon. Thus, whereas theseapproaches use the most sophisticated methods of inquiry, they can addthe least to our knowledge about bureaucratic organizations.

Only one idea attributed to Weber emerges in every approach tobureaucracy: That is the efficiency of the bureaucratic organization. At thesame time, that is the sole attribute, which—partly or entirely—has beendenied from bureaucratic organizations by all the relevant authors.




Consecutive schools of management gradually proved that bureaucracy isfar from being always the most efficient form. Organizational sociologyreached the same conclusion via empirical and theoretical research. Neo-classical economists treat bureaucracy as a nonmarket mechanism and,thus, by definition, ineffective. Theorists and scholars of public adminis-tration frequently draw a similar conclusion in the case of publicbureaucracies.

Authors working within various branches of social sciences and vari-ous approaches within those branches interpret the term bureaucracy, notsurprisingly, in various ways. The differences among these authors are noless significant when they speak about efficiency. When sociologistsspeak about efficiency, they frequently mean effectiveness or rather goalattainment, adequate achievement of explicit functions of the organiza-tions. Others, when speaking about inefficiency, mean the lack of adaptivecapabilities. Again, others call our attention to inefficient coordinationand control of self-interest-driven or value-driven individual actions.Most of these authors do not define clearly what they mean by efficiencywhen speaking about inefficiency of bureaucratic organizations. Onlyeconomics—and to some extent game theory—provide clear definitionsof efficiency.5 These, however, turn out practically inapplicable even inthe market sphere and especially in case of hierarchical-bureaucraticarrangement. Only the efficiency criterion of the systems approach,namely the maximization of output/input function, seem to be applicablefor organizations. But how can we interpret, handle, and operationalizethis function in a nonmarket environment? It seems that the more precisethe definition of efficiency is in social sciences, the less it covers the con-tent of what Max Weber meant by that term.

Nevertheless, however we define efficiency, we must answer a crucialquestion. If bureaucratic organizations are inefficient, ineffective, unableto adequately adapt to changes and the variety of different circumstances(that is, variance in space and time), and can be characterized with insuffi-cient goal-attainment capabilities—if all these are true, why do we face allaround us bureaucratic organizations, organizations whose characteristicinternal features are largely identical to those laid down by Max Weberalmost a century ago? What is the secret in bureaucratic structures andmechanism, which, in spite of all its drawbacks, keeps bureaucratic orga-nizations alive? Why is it still present to a great extent in public adminis-tration as well as in large enterprises, in parties and armies, in the RomanCatholic Church, and in charity organizations?




We may reasonably believe that there is something inherent in thebureaucratic organization itself that explains its proliferation and widepresence in every sphere of society. In the following section, I will showthat this thing clearly can be found in Max Weber’s analysis of bureaucraticorganizations and the reasons of their timely and spatial proliferation.

WEBER ON THE SUPERIORITYOF BUREAUCRATIC ORGANIZATIONS

Weber’s general interest is not in the bureaucracy in itself but in a gen-eral historical process, the process of rationalization, which emerged onlyin the Occidental cultures. Weber (1958) gave a brief account of hisimmense interest in the topic in the introduction of The Protestant Ethicand the Spirit of Capitalism. He briefly summarized the various spheres ofsociety where rationalization takes place, from arts to sciences, from com-merce to administration and formal law. These elements of rationalizationare strongly related to one another. The basis of all these phenomena laysto a great extent in the disenchantment of the world that takes place mostlyin the religious sphere.

We are less interested now in Weber’s general social theory. What weemphasize here is that Weber treats bureaucracy within the context of therationalization process (Habermas, 1984, pp. 143-278; Schluchter, 1981).The emergence of bureaucracy fits into this process of rationalization forseveral reasons. First, bureaucracy itself is a rational phenomenon. It rep-resents the process of rationalization in its very existence, through itsinternal structures and way of operation. It is, says Weber, the most ratio-nal organizational form of administration both in the public and the privatesphere. Second, bureaucracy is the primary institution for the applicationof formal law, which is another crucial element of rationalization. Third,bureaucracy as a central component of the public sphere is indispensablefor the functioning of the capitalist economy because the capitalist firm isbased internally on precise calculation and accounting. “For bureaucracy,the very element of calculability of its rules has been really of decisive sig-nificance. The nature of the modern civilization, especially its technical-economic structure requires this calculability of consequences” (Weber,1966, p. 350).

In the original German, Weber frequently uses the terms rationalityand formal rationality, whereas he never uses the word efficiency




(Effizienz). Albrow (1970) quoted Weber’s presentation at a conference inVienna. There, at the German-speaking conference, Weber deliberatelyused the English word efficiency. Albrow warned,

It also indicates that “efficiency” was for him a foreign term. It appears inmany translation of Weber’s work but this reflects more the preconceptionsof the translator who cannot conceive of rationality in the organizationexcept as efficiency, than any consistent usage by Weber of a term equiva-lent to efficiency. (p. 64).

Others (Leivesley et al., 1994) criticized even more sharply the “efficiencyinterpretation” of Weber’s translation/interpretation on a similar basis.Both of these articles quote several shocking examples of scholarly misin-terpretations of Weber.

Actually, Weber’s usage of the term rationality may have greatly con-tributed to the confusion (Elster, 2000). Weber used the term with various,frequently contradictory meanings. He himself warned the reader of thisfact. He used the term in compounds like purposive-rationality, value-rationality, or substantive and formal rationality. Rationality may meancrystallization of certain social spheres, regular and well-structured pro-cedures, consistent internal system of norms and/or consistent, regularapplication of these norms, and so forth. Eminent scholars have attemptedto clarify the various meanings of Weber’s term rationality (Elster, 2000;Habermas, 1984; Schluchter, 1981). We are, however, interested in a lessgeneral task. We do not search for the meaning of rationality in Weber’swork generally. Our goal is practically oriented. We are interested in thoseattributes of the Weberian concept of rationality that explain the wide-spread existence of bureaucratic organizations in spite of the generalscholarly doubt in its efficiency or rather adequacy.

We may conclude at this point that (a) Weber spoke about the formalrationality of bureaucracies instead of their efficiency and (b) the scope ofdenotation of formal rationality greatly differs from that of efficiency;anyhow, the latter has been conceived in social sciences. Now, the task isto capture the difference between these two terms in reference to bureau-cratic organizations.

THE MISINTERPRETED CONCEPT OF RATIONALITY

Weber (1978) treated the phenomenon of bureaucracy most of all intwo parts of his great work Economy and Society:




1. In volume 1, chapter 3, he briefly summed up the characteristic features ofbureaucratic organization and the specific position of the bureaucrat underthe title “Legal Authority With a Bureaucratic Administrative Staff.”

2. In volume 2, chapter 11, under the title “Bureaucracy,” Weber went intogreater detail in analyzing the individual features of bureaucracy andshowed how the modern form of bureaucracy differs from historically ear-lier forms of administrative organizations.

Most of the scholars interpreting Weber’s bureaucratic theory rely onthese two chapters. These scholars typically followed the earlier described“internal features lead to general attribute of efficiency and thus the supe-riority of bureaucracy” scheme. The logical scheme remains intact if wedeny all elements; that is, internal features do not cause general organiza-tional efficiency and, thus, bureaucracy is not superior to other forms. Forthe sake of simplicity, I will use a similar logical frame.6 I do emphasize,however, that this general attribute for Weber was not efficiency but ratio-nality. Identifying this general attribute with efficiency leads to misinter-pretation, as I demonstrate below.

Most of the authors following the efficiency scheme omitted severalelements of the attributes listed by Weber. Although there is significantvariance in the interpretations, some general and very characteristic ten-dencies can be observed.7 Four attributes dominate the studies of thoseauthors who capture bureaucracy as an organizational phenomenon:

1. specialization and/or division of labor;2. expertise (well-trained personnel with significant job experience);3. rules, which define structures, procedures, and individual responsibilities;

and4. hierarchy.

It is generally accepted that specialization and division of labor directlylead to increased productivity. Expertise, knowledge of how to deal ade-quately with issues at hand, has a similar effect. Rules may describe andenforce the one best way of handling cases; thus, they may also greatlycontribute to increased efficiency. Hierarchy, however, appears mostly notas an internal feature that directly contributes to efficiency. Hierarchy inthis context is only a reaction to division of labor, which requires coordi-nation in the organization. Beyond their primary function in directlyincreasing efficiency, rules may also serve as a tool of coordination.

This interpretation of the Weberian internal features of bureaucracy isheavily biased. This bias can be identified in at least three points. First,several attributes that Weber consistently uses in the description of




bureaucracy are systematically omitted. Such attributes are the segrega-tion of official activity from private domicile; the regularity of activities,the fact that “administrative acts, decisions, and rules are formulated andrecorded in writing” (Weber, 1978, p. 219) or frequently impersonalityitself. Second, a cause-effect-like logical order is introduced into the list ofinternal features, which was not indicated in Weber’s original list, forexample, hierarchy has only an indirect effect on efficiency. Finally, thedenotation of attributes is undoubtedly changed in the process of interpre-tation. For instance, the most frequently quoted attribute, the division oflabor, hardly appears in the original text. It can hardly be found even in thetranslation. Weber (1978) instead spoke about a clearly “defined sphere ofcompetence (jurisdiction)” (p. 218).

It is easy to discover a systematic trend concerning the elements thatwere omitted. Authors seemingly collect those attributes that adheredirectly to organizational efficiency. Consequently, we end up with amodel that is hardly anything other than a descriptive version of FrederickW. Taylor’s or Henry Fayol’s prescriptive model. The variance amonginterpretations can be explained according to the elements they emphasizein the Taylorian-Fayolian model and how they combine these elementswith the Weberian attributes. For instance, although some authors ignoreit, others emphasize the importance of impersonality. In the latter case,impersonality is related to the Taylorian approach that terminates the indi-vidual (personal) ways of working and replaces them with standardizedprocedures of the most efficient, the one best way of working.

As we can see, most scholars interpreting Weber’s theory share thesame approach. In the first step, they identify the Weberian term rational-ity with the term efficiency. We proved above that the two terms are not atall identical, and Weber himself reflected on this fact. Second, authorssystematically look for those features, and only for those features, thatsupport the concept of organizational efficiency while they omit other fea-tures. Finally, to produce a perfect cause-and-effect relationship of inter-nal features to the general attribute (efficiency), these authors signifi-cantly change the original meaning of even those attributes, which wereadopted from Weber. This leads to a systematic misinterpretation, or atleast a biased interpretation, of the Weberian text.




WEBER ON BUREAUCRATIC RATIONALITY

What, then, did Weber mean by the formal rationality of bureaucraticorganization? No doubt that certain segments of efficiency are included inrationality. On the other hand, it is also clear that rationality covers otherelements than those covered by efficiency. I start my analysis with a fre-quently quoted paragraph in which Weber summed up his opinion on thesuperiority of bureaucratic organizations. This paragraph has been trans-lated by Talcott Parsons (Weber, 1947/1966) as follows:

Experience tends universally to show that the purely bureaucratic type ofadministrative organization—that is, the monocratic variety of bureau-cracy—is, from a purely technical point of view, capable of attaining thehighest degree of efficiency and is in this sense formally the most rationalknown means of exercising authority over human beings. It is superior toany other form in precision, in stability, in the stringency of discipline, andin its reliability. It thus makes possible a particularly high degree ofcalculability of results for the heads of the organization and for those actingin relation to it. It is finally superior both in intensive efficiency and in thescope of its operations, and is formally capable of applications to all kindsof administrative tasks. (Weber, 1978, p. 223)8

Let’s have a closer look at this translated paragraph! The word efficiency isused only by the translator. The structure of the paragraph, however,seems to be logically ambiguous. Seemingly, the first sentence contains ageneral statement, namely, that bureaucracy is the most efficient form ofadministration. The following sentences go into detail: How can this gen-eral attribute be captured and of what is it composed? The fact that here weget a detailed list of the elements of what is called by the translator “effi-ciency” can be seen from several stylistic marks, such as the enumerationof nouns in the second sentence or including the word finally in the lastsentence of the paragraph. This last sentence refers to “intensive effi-ciency.” It may seem that the author makes here a logical mistake. Heincludes an element in a set, which is identical to this element. Efficiencyappears as an element, a segment of efficiency.

Furthermore, when we go into detail, we find a list of expressions thatcan hardly be treated as elements of even the most widely conceived defi-nition of efficiency. Such elements are precision, stability, stringency ofdiscipline, and most of all, reliability and calculability. Strangely enough,efficiency is the only characteristic in the list that may clearly belong to thegeneral attribute of efficiency.




There is another frequently quoted paragraph that seemingly supportsmore the advocates of the efficiency theorem:

The decisive reason for the advance of bureaucratic organization hasalways been its purely technical superiority over any other form of organi-zation. The fully developed bureaucratic apparatus compares with otherorganizations exactly as does the machine with non-mechanical modes ofproduction. Precision, speed, unambiguity, knowledge of the files, continu-ity, discretion, unity, strict subordination, reduction of friction and materialand personal costs—these are raised to the optimum point in the strictlybureaucratic administration, and especially in its monochratic form.(Weber, 1978, p. 973)

Here, the reduction of material and personal cost clearly belongs to thecategory of efficiency. Similarly, speed can be interpreted as an indicatorof efficiency. But still, most of the words used here can hardly be pressedinto the class of efficiency.9

If we concentrate only on those general attributes that directly, in them-selves, explain the superiority of bureaucracy in the two excerpted para-graphs, we find the following: precision (in both quotes), stability, reli-ability, calculability, efficiency (as a mistranslation), a wide range ofscope of operations, speed, unambiguity, continuity, reduction of friction,and reduction of—material and personal—costs. Let us try to classifythese general attributes. What are those attributes that can be classified asparts of a general, vaguely and widely defined efficiency, and what arethose that cannot be forced under this category?10 I do this in Table 1.

As we can see, there are far more attributes listed by Weber that do notfit into the category of efficiency than those that do. If nothing else, thevast number of these attributes must motivate us to search further for gen-eral category(ies) other than efficiency. Are there general categories thatcan embrace some or all of the nonefficiency attributes? In our view, thereis one such general category. That is what I will call uncertainty reduction.

UNCERTAINTY REDUCTION AS A MISSINGPART OF BUREAUCRATIC RATIONALITY

According to our hypothesis, bureaucratic organizations minimizeuncertainty11 both in their outputs (what they do) and in their procedures(how they do it). Precision, stability, reliability, calculability,unambiguity, reduction of friction—all of these are terms clearly referring




to this feature of bureaucracy. Continuity can be conceived as uncertaintyreduction in a time frame; that is, inputs are accepted at any given time andprocessed in a predictable timely manner (official deadlines).

As Weber could not give a clear-cut definition of rationality and his fol-lowers and critics have not defined clearly what they mean by efficiency,we cannot provide an unambiguous definition of uncertainty reduction.From communication theory, we suppose it is related to information. Theminimization of uncertainty maximizes predictability and calculability ofactions, procedures, and outputs. An expert may easily predict what kindof procedures take place in the organization and what kind of output can beexpected from a certain set of inputs.

Bureaucratic organizations differ most of all from historically previousforms of administration exactly at that point. We can calculate how muchtax we have to pay for a certain amount of income. We can anticipate whatkind of conditions we have to fulfill to be eligible for certain public ser-vices. We can predict if we get a license or not. We know how long the pro-cedures will take. We will be informed in advance when and how we haveto take part in the procedures, what kind of data we have to provide forthese procedures, and so forth.

Everyday experience may lead us to a contradictory conclusion. Fre-quently, we feel the action of bureaucracies rather unpredictable. In thosecases, however, we compare the bureaucratic reality to our expectation. Ifwe compare the level of uncertainty provided by bureaucracy to those


TABLE 1

Classification of General Attributesof Bureaucracy Listed by Weber

Efficiency Nonefficiency

Efficiency itself (in the original text: high Precision (in both quotes)quantity and quality of performance) Stability

Speed ReliabilityReduction of costs CalculabilityA wide range of scope of operationsa A wide range of scope of operations

UnambiguityContinuityReduction of frictionb

a. This element can be included only into a very widely defined concept of efficiency.b. This is understood as reduction of friction in outputs/performance and thus interpreted as ageneral attribute.



provided by other types of organization, we can conclude that bureaucracyserves us still with the lowest level of uncertainty. This is true either if wecompare to previous organizational forms—as Weber did—or other, pres-ently existing types of organization. For instance, think about the unpre-dictability of taxes, fines, licenses, and other prerogatives in the medieval ages.Think about the unpredictability of procedures and outputs in such organicorganizations as newly established clubs or as voluntary organizations.

Uncertainty reduction benefits not only the clients but also the ruler atthe top of the bureaucratic hierarchy. Uncertainty reduction greatly con-tributes to the possibility that orders, whether normative (that is, rule orlaw) or individual orders of the ruler, will be followed.

Uncertainty reduction operates not only toward the future (predictabil-ity, calculability) but also toward the past. Past outputs and procedures canbe easily reconstructed from the written, systematically stored, and easilysearchable files that contain every relevant element of the case at hand.The reconstructibility of the past is a form of uncertainty reduction.Besides, it assists the ruler in the control of the organization.

Examining internal features from the perspective of uncertainty reduc-tion reveals that Weber’s interpreters missed important elements—andtherefore some of the key arguments—of the original text. Internal fea-tures that were previously omitted, less emphasized, or more freely inter-preted gain relevance in their own right. Hierarchical structure unambigu-ously defines both horizontally and vertically the place of individuals anddivisions, as well as the communication channels. Jurisdiction—which isfar more than simply division of labor—indisputably determines who isresponsible for processing certain types of cases, that is, who can act butalso who has to act. Furthermore, jurisdiction exactly defines how she orhe will act. Regulations contain detailed description of how to processcases, what the necessary procedural elements are, which relevant inputsare to be processed, how to obtain those inputs, and how to combine themto create an output—in the typical administrative context, how to combinedata to reach a legitimate decision. Thus, anyone who knows the regula-tions—which embrace jurisdiction—can predict with great precision boththe outcome and the procedures of a bureaucratic organization. As wasseen, the role of written files is to reduce uncertainty regarding past proce-dures and outputs.

The greatest threat to the bureaucratic system—as Weber sees it in ahistorical context—is that personal emotion and moral judgment may dis-tort the system. The ability to work without affections, thus, is the personalprecondition of the existence of bureaucracy. Impersonality, the




separation of workplace from private domicile, the requirement of con-ducting work sine ira et studio, thus, are features that aim to prevent dis-tortions of bureaucratic functioning that lead to uncertainty reduction.

UNCERTAINTY REDUCTION AND EFFICIENCY

Uncertainty reduction is not a part or condition of efficiency. Eventhough there is a relationship between these two concepts, they should bekept separate from one another. The relationship between the two phe-nomena is unidirectional. We can enumerate those conditions underwhich uncertainty minimization leads to increased efficiency, as well asthose conditions under which we may reasonably expect uncertaintyreduction to cause decreased efficiency. Uncertainty reduction may leadto efficiency if the uniformity of outputs is required, such as in case ofmass production. If the environment is predictable and stable, a predict-able organization usually is an adequate, efficient form. Furthermore, inlarge-scale organizations, where coordination and control consume agreat proportion of costs, uncertainty reduction in internal proceduresmay significantly reduce this cost and, again, lead to increased efficiency.On the other hand, if the demands toward outputs vary in time and space,uncertainty reduction may lead to inadequacy of procedures and outputs.Rigidity and inability of adaptation become a major obstacle to efficiencybecause outputs will be undervalued by potential clientele. Moreover, ifthe originality of outputs is a major criterion on which the value of outputsis measured, such as in the case of research or advertisement activities,uncertainty reduction may be undesirable.

It is difficult to find a cause-effect relationship in the opposite direc-tion. We may hardly enumerate conditions under which efficiency couldclearly—positively or negatively—affect uncertainty reduction. The lackof such a known relationship may reflect the lack of research in this field(because efficiency has always appeared as the dependent variable in thiscontext) or simply the lack of such a relationship in reality.

Presumably, Weber could not differentiate between efficiency anduncertainty reduction in his work, when he embraced both of them into histerm rationality. Information and uncertainty only became scientific top-ics well after his death. As I indicated, the term efficiency was foreign tohim, and no generally accepted scientific definition existed for this term inhis life. Scientific thinking, in that regard, reflected socioeconomic reali-ties. The typical organizational environment of Weber’s age hid the




intricate interrelationship between the two factors. An extensive develop-ment took place at the turn of the century. Mass production seemed to bethe present and the future of industrial and administrative life. Mass pro-duction was delivered by large-scale organizations in which uncertaintyreduction directly led to cost reduction. Questions of production insteadof marketing and client needs were the focus of attention for both organi-zational practitioners and theorists. Organizations were captured asclosed systems. Efficiency was conceived as an internal problem ratherthan a reciprocal effect of the organization and its environment. Thechanges in technology, in client needs, in prices, and in the compound ofmarket were much less accelerated 100 years ago and thus did not raise theproblem of quick adaptation. Due to all these traits of Weber’s time, uncer-tainty reduction and efficiency were such strongly correlated factors inreality that it was hardly possible to isolate them from one another.

CONSEQUENCES OF UNCERTAINTY REDUCTION

We can conclude that the bureaucratic organization is the organiza-tional form, which reduces to the greatest possible extent uncertainty bothin its internal procedures and in its outputs. The objective function, whichis met—according to my hypothesis—best by a bureaucratic organizationis MIN (UNCERTAINTY), irrespective of the impact of this function onefficiency. The advantages of uncertainty reduction are twofold. First, butperhaps less important, uncertainty reduction may contribute to organiza-tional efficiency. Even though the objective function of bureaucracy isinsensitive to efficiency requirements, uncertainty reduction provided bythis type of organization may result in increased efficiency under certainconditions, as was seen above.

Uncertainty reduction, however, may have a decisive benefit in its ownright. This benefit is especially important in the case of public administra-tion within modern democratic political systems. First, uncertainty reduc-tion excludes, or at least minimizes the possibility of, arbitrariness. Lackof arbitrariness, the predictability of actions of public offices for every cit-izen is a sine qua non for the equality of the treatment of citizens and theexistence of the rule of law that are major preconditions of any democraticpolitical system.

Second, uncertainty reduction helps to keep public bureaucraciesunder control. If standards of procedures and outputs are clearly definedand the very essence of the organization is to adhere strictly to these




standards, any kind of divergence from these standards is relatively easy todetect, sanction if necessary, and ensure that the organization returns tothe expected track. Nondemocratic functioning in this context is identicalto nonbureaucratic functioning. Uncertainty reduction as a general attrib-ute of public bureaucracies guarantees that the goals of the public laiddown by the representatives of the public (e.g., the laws enacted by the leg-islature and policies adopted by elected politicians) will be followed to thegreatest possible extent. This is, again, a central tenet of modern demo-cratic systems.

Uncertainty reduction in public administration is not only a precondi-tion for democratic functioning. It can also be approached from an eco-nomic point of view. We presume that uncertainty reduction may also con-tribute to increased total social utility.

Uncertainty is treated as an exceptionally important factor in the orga-nizational environment by those who conceive of organization as an opensystem (Katz & Kahn, 1966; Thompson, 1967). Uncertainty in an organi-zational environment is generated mostly by the actions of other organiza-tions. Uncertainty is a problem to be solved by organizations, and in eco-nomic terms, it greatly increases the costs to individual firms. Transactioncosts, a central concept of neoinstitutional economics, refers exactly tothis problem (North, 1990; Williamson, 1975). Uncertainty produced byunexpected actions of a firm is often a burden on other firms. Thus, in neo-classical economic terms, uncertainty is a type of negative externality andhas the same attributes as other types of externalities: A competitive firmwill not take into consideration the negative impact on others as long as itdoes not affect negatively its own profit.

The role of public administration concerning uncertainty as anexternality is twofold. First, since public administration is devoted to thepublic interest, it is reasonable to expect that public administration will actin a way that maximizes the social utility. In this theoretical frame, publicorganizations, while choosing between alternatives of actions, would takeinto consideration with a minus sign the total effect of uncertainty embed-ded in their action on the society. Thus, certain actions that may seem themost efficient from a narrow perspective may not be efficient on the sociallevel if the negative effects of uncertainty induced by them are included.Minimized uncertainty in public organizations, thus, is a value relevantnot only from the perspective of democracy but also from the perspectiveof overall social utility (Williamson, 1994).

Second and even more important, public administration, as a govern-ment activity, is supposed to remedy market failures such as the negative




externality induced by unexpected actions of individual firms. Whereas itis reasonable to expect that overall, public organizations act on the basis ofmaximal public utility, the same cannot be expected from private organi-zations. For this reason, public organizations play a crucial role in ensur-ing uncertainty reduction within the market sphere via regulation, system-atic control, and precise law enforcement. For an extreme example,infringement of property rights is not simply a zero-sum game betweentwo players; it endangers the normal functioning of modern market mech-anism. Government activities aimed at reducing uncertainty in the privatesphere have been neglected by neoclassical economists discussing gov-ernment functions. Institutional economists, however, strongly empha-size this function (North, 1990; Williamson, 1994).

Generally speaking, uncertainty reduction is extremely and increas-ingly important in every sphere of modern society.12 Uncertainty reduc-tion is and should be a central objective of public organizations. The rea-son for the prevalence of bureaucratic organization may be that it is able tominimize uncertainty to the greatest extent of all known organizationalforms. The application of bureaucratic organizational form in case of pub-lic administration yields two advantages: (a) It is inevitable for the demo-cratic mode of governing, and (b) it may greatly contribute to overallsocial utility. When judging public administrative activities, one may takeinto consideration not only efficiency—especially not only bureau effi-ciency (Lane, 1987b, pp. 22-28)—but also the positive effect of uncer-tainty reduction in the society.

CONCLUDING REMARKS

In reinterpreting Weber’s theory, I have raised an aspect of bureaucraticrationality that has been greatly ignored. This aspect is uncertainty reduc-tion. Uncertainty reduction may explain the superiority and the preva-lence of bureaucratic arrangement in several cases when efficiency cannotbe the explanatory factor.

Nevertheless, additional research is necessary (a) to provide a moreprecise definition of uncertainty reduction in this context, (b) to empiri-cally test the hypothesis that bureaucracy is really the organizational formthat is able to reduce uncertainty to the highest possible extent, and (c) toanalyze the presence of uncertainty reduction in the public administrationas well as its effects on the society.




According to the current theory and especially the practice of publicadministration, bureaucracy is an entirely negative phenomenon. Thisarticle proposes a different, but not entirely opposite, approach. In severalspheres of the—presently—public services, debureaucratization may bedesirable due to the overall insensitivity of bureaucracies to the require-ment of efficacy. However, there are several functions of public adminis-tration in which debureaucratization may be detrimental. Taking into con-sideration that bureaucracies seem to be eminent in uncertainty reductionmay assist the intricate decision of where to keep bureaucracies, or evenreinforce them, and where to adapt other organizational forms.

NOTES

1. The selection of readings and the editors’comments render an excellent guideline forthe consecutive schools of organizational theory (Shafritz & Ott, 1996).

2. Blau and Meyer (1971) provided an excellent summary of the major questions andachievements in the field.

3. I will use the terms internal features and general attribute(s) systematically in thisarticle as they are presented here.

4. Interestingly, although neoclassical economists seem to agree on the suboptimalityof bureaucracies, they greatly differ in what they consider a reason for suboptimality. Forinstance, whereas Niskanen (1971) originally blamed oversupply as a sole reason ofsuboptimality, Migue and Belanger (1974) found that public bureaucracies produce outputswith a higher unit cost than their private counterparts.

5. Pareto optimality in case of the market and optimal level of output in case of an indi-vidual firm as determined by the marginal revenue and marginal cost curves.

6. In fact, what we call internal attributes here are not clearly reasons or causes of thegeneral attributes, that is, rationality. In Weber’s texts, they frequently appear as segments ormanifestations of the rationality itself. As Schluchter (1981) and Habermas (1984) pointedout, impersonality, the application of formal law, and so forth are embodiments of rationality.This rather philosophical fact is, however, irrelevant to the argument of this article.

7. Several authors attempted to sum up the features common in various interpretationsof bureaucracy. See, for instance, Albrow (1970, especially p. 99) and Lane (1987b, espe-cially p. 4) or Mills and Simmons (1995, pp. 34-42). It is interesting that even this latter, quitecritical approach follows unconditionally the efficiency theorem of mainstream organiza-tional theory.

8. This paragraph is only one sentence in the original German version (Weber, 1972,p. 128). Here, I provide a translation that follows the original text as closely as possible:

Due to all experiences, the pure bureaucratic, that is, the bureaucratic-monocraticform of administration, based on written files, is, purely technically, capable ofreaching the highest level and perfection of performance with respect to its precision,continuity, discipline, stringency, altogether: predictability for its ruler (Lord) as wellas for other interested parties and with respect to the qualitative and quantitative




aspects of its performance and its formally universal applicability for all tasks. Thismeans that it is the most formally rational form of exercising power.

9. Although in the previously quoted paragraph, Weber listed mostly characteristicsthat we could regard as general attributes, in this paragraph, he enumerated characteristics,some of which we regard as internal features. The reason for this fact is twofold. First, Weberemphasized the machine-like characteristics of bureaucracy. (Please note that a machine isdifferent from human labor not only in its higher level of performance but also in the predict-ability of its functioning and performance as well as the perfect equivalence of outputs.) Sec-ond, as I indicated in Note 6, some characteristics, which were later interpreted as causes ofrationality (internal features), were in Weber’s view manifestations of rationality itself. Inthe further analysis, I will rely only on those characteristics that can be conceived as generalattributes.

10. Categorization requires interpretation; thus, subjectivity cannot be excluded. How-ever, including the characteristics listed in the right column of the table into the category ofefficiency would detach this term from its original meaning to such an extent that its use associal sciences concept would become questionable.

11. Unlike rational choice theory, I do not differentiate between risk and uncertainty.Uncertainty means simply the opposite of sure in the context of this article.

12. North (1990) wrote that “more than 45% of national income was devoted to transact-ing” (p. 28) in the United States, whereas it was approximately 25% a century before.

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Gyorgy Gajduschek is a senior researcher at the Hungarian Institute of PublicAdministration and an associate professor at the Karoli University, where he teachescourses in public administration and organization theory. He holds a Ph.D. in politi-cal science. He participated in several empirical comparative studies in the Central-East European region and was involved in various public administration reform pro-jects. He has published more than 20 papers in English and Hungarian. The mainfields of his academic interest include the theory of public organizations, decisionmaking in government, and efficiency measures for public management.




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