The purpose of this paper is to suggest that the modern economic theory of bureaucracy developed by economists Breton and Wintrobe is a heretofore unrecognized precursor to the new public management (NPM) construct.
After presenting a comparison of the modern economic theory of bureaucracy to the basic principles of NPM, this paper offers a treatment of Breton and Wintrobe's modern economic theory of bureaucracy that uses the compelling episodic example of the 1944 attempt by the Nazi SS to deceive, through the now infamous Theresienstadt “Embellishment,” the International Red Cross and world communities about the existence of the Nazi Holocaust bureaucracy.
The comparison of the conceptual elements of the two models and the integration of the historical episodic example support the view that the modern economic theory of bureaucracy is a precursor to NPM.
This is the first study to date to present the modern economic theory of bureaucracy as a precursor to the principles of NPM. As such, future research in either area that recognizes the connection made in the present study is potentially enhanced.
