top of page

How Does Bureaucracy In State Institutions Hinder Economic Growth?

Bureaucracy, as suggested by Mahfouz (2008), derives from the two words "bureau" and "cracy" — the latter of which is, in itself, derived from the Latin word "Kratia" meaning strength. The notion of bureaucracy posits that efficiency is inextricably linked to authority, centralization, due-process, and arguably, sovereign control. As such, bureaucracy has come to represent a system of operations and values which prioritizes and emphasizes the need for due-process, monotony, professionalism, and centralized forms of decision-making. Although the aforementioned system is often discussed and evaluated in terms of its relationship to frameworks of political governance, bureaucracies can be implemented in a vast array of academic, professional, and personal spaces. Mahfouz (2008) explains that such systems are amongst the most commonly found and utilized throughout the Middle East.

Bureaucratic administrative systems are popular, especially throughout the developing world, as they are both admittedly capable of increasing overall efficiency levels and simultaneously effective in their ability to establish forms of administrative stability, as the advocates of bureaucracy believe. Thus, the notion of bureaucratic order revolves around the presupposition that the 'office' and 'bureau' increase efficiency in the opinion of the bureaucracy's supporters.

Interestingly, contemporary forms of bureaucratic administrative order have evolved from a historical need to improve the overall levels of efficiency and organization of economic activity. As such, it can be argued that bureaucratic development was originally established to improve economic activity. However, despite being generally discussed as an abstract notion with financial procedures and implications, economic growth is much more complex and multi-faceted than it may initially seem. The individual and professional aspirations, demands, requirements, and commitments, which shape forms of economic growth create an ever-increasingly complicated space of political, economic, social, technological, legal, and environmental change, which in turn, require parallel forms of governance, review, and continued evaluation. Therefore, within this particular space complex, the bureaucratic administrative system was formulated and developed to deal with the new chaotic forms of economic activity and interactions resulting from economic growth.

The implementation of administrative bureaucracy relied on the presupposition that increased order and efficiency would lead to similarly increased forms of economic activity — a belief that is not only largely outdated but that has also been repeatedly disproven throughout the last two centuries. There are several reasons why bureaucratic administrations betray otherwise continuing forms of economic growth, the most important of these being the overwhelming burden associated with an increased regulative, legislative, and legal obligation. At their very core, bureaucracies tend to undermine the potential value associated with otherwise spontaneous forms of economic activity, leading to much more difficult business environments, where administrative capacities become more of a burden than a potential avenue for increased growth. Furthermore, bureaucracies tend to promote forms of corruption, as they directly sponsor the placement of otherwise largely unnecessary mediums between business people, politicians, and state officials.

Because bureaucratic administrations tend to rely on an incredibly rigid, hierarchic, and centralized system of operations, the need for due process, regulation, and authoritarian oversight precede the entire economic process. As a result, when left unregulated and unmonitored, bureaucratic administrators often tend to wield excessive and dangerously high levels of power and authority, which not only actively promote levels of corruption but significantly undermine the underlying features of innovative and entrepreneurial economic development. Because of the adverse impact that bureaucratic administrations often have on economic activity, it can be argued that, despite being initially formulated to ensure continued growth, these systems have led to the repeated degradation of contemporary economic growth.

It should not be forgotten that economic activity can only be succeeded by an initial form of individual, corporate, and professional freedom in terms of abstract ideas, creativity, and action. But unfortunately, bureaucracies undermine the freedom of their ideas and the potential value of creativity and create lethargic spaces of oppression, immobility, and rigid centralization that are neither fit to accommodate innovation nor entrepreneurship.

Overwhelming bureaucratic interference and penetration into the economy and society may not be in the interest of progress and prosperity, according to what critics of bureaucratic expansion and penetration see, such as Max Weber, who was concerned about liberties from the bureaucracy despite his recognition of its inevitability, and Karl Marx despite his contradictions about bureaucracy, as he abhors it during the period of class capitalist control, while welcomed it during the stage of socialism and the rise of workers' influence. Bureaucratic administrations can also promote increased socio-economic and political inequality, as they tend to help sponsor a ruling class of bureaucrats with unprecedented levels of power and control.

Despite all this, these administrative systems are not always mediums for increased corruption, inequality, and undermining economic activity. On the contrary, they have been suggested to smooth economic progressive transformation when implemented reasonably.

Abdurraouf Abdussalam Elakder Alyoncee

عبدالرؤوف عبدالسلام الأخضر اليونسي

5 views0 comments
bottom of page