ASSESSING THE ASSUMPTIONS - A CRITICAL ANALYSIS OF AGENCY THEORY

Principal-agent (agency) theory dominates the bureaucratic politics li terature. Yet there has been very little effort devoted to assessing t he assumptions of agency theory since the model was imported from econ omics. This article examines five major assumptions underlying agency theory The authors suggest that the effort to translate and apply assu mptions from economics to the study of bureaucratic politics misses mu ch that is important. They offer modifications to agency theory and a new direction for research.