Public Sector Unions, Government Expenditures, and the Bureaucratic Model

The Niskanen work, Bureaucracies and Representative Government (1971), makes explicit references to labor market, bureaus, and their relations with their factor suppliers. ?For several reasons,? it argues, ?the bureaucracy is the last stronghold of wage and factor price discrimination? (31). The work continues by explaining the source of such discrimination: The first basis for wage and factor price discrimination is that bureaus are often monopoly suppliers of some services. These bureaus are thus also monopoly buyers of those labor skills and material factors that are specialized in the production of these monopolized services. Infantry officers are paid less than pilots