In our quest for knowledge, we often depend on individuals labeled as “experts,” which, as defined by Roger Koppl in his 2018 work, Expert Failure, refers to those who receive compensation for their opinions. This definition proves useful, allowing us to bypass the convoluted, often arbitrary debates about who qualifies as an expert.
Experts influence many aspects of our livesâfrom weather forecasts and medical advice to technical services like car repairs. Organizations, both governmental and private, also lean on experts. They often establish internal teams of specialists to generate insights and recommendations. The interplay between these embedded experts and the bureaucracies they operate within presents a fascinating dynamic, which I delve into in my recent working paper, âExperts Whispering Down the Lane.â
When we interact directly with an expertâsay, our doctor, mechanic, or meteorologistâwe receive firsthand information. However, in larger organizations, the flow of communication often encounters multiple layers between the expert generating the opinion and the non-expert relying on that opinion.
Consider a scenario where a Vice President of Marketing seeks advice on how to promote a new product. They delegate the task to a manager, who in turn instructs their team. If this team is the source of expertise, they will gather the necessary data and formulate an opinion. This opinion is then summarized for the manager, who conveys it to the VP. Ultimately, the VP makes a decision, which gets disseminated throughout the organization. Anthony Downsâ 1966 RAND Corporation paper highlights that communication can falter as directives move down the chain of command, a phenomenon he terms âauthority leakage.â I introduce the concept of âinformation leakage,â emphasizing that crucial information can be lost as it travels back up the hierarchy. Misunderstandings may arise, leading the VP to make decisions based on distorted information.
Moreover, seeking clarification in bureaucracies can be a costly endeavor since non-experts do not directly communicate with the experts. Instead, both groups navigate through formal organizational structures.
Several factors exacerbate the issue of information leakage. Firstly, there’s the economic reality of scarcity; everything, including time, is limited. When an expert summarizes a report, they must decide what information to include or exclude. Furthermore, thereâs often a trade-off between technical accuracy and understandability; jargon may confuse those unfamiliar with the subject. However, jargon serves a purpose: translating it into simpler terms risks losing precision, potentially leading to further misunderstandings (I elaborate on this issue here).
Humans naturally communicate both literally and metaphorically, which can lead to confusion. For instance, consider a recent satellite image depicting a record snowstorm that dumped 40 inches of snow in Massachusetts. With well-defined eye patterns and spiraling clouds, it produced sustained winds of 85 miles per hour. When I described this storm to my Louisiana studentsâwho have only witnessed real snow once in a freak blizzardâI likened it to a âhurricane with snow.â While not literally accurate, this metaphor effectively conveyed the storm’s seriousness.
However, this metaphorical description risks misinterpretation. Someone taking it too literally might conclude that a blizzard is simply a hurricane with snow, leading to confusion. Without proper context (and a dash of luck), distinguishing between literal and metaphorical language can become challenging.
The key takeaway is that as the number of layers between an expert and a non-expert increases, so does the likelihood of miscommunication. Itâs reminiscent of a game of telephoneâwhere the message gets distorted as it moves through various channels (and letâs not forget any personal biases that might color the transmission).
So why endure the complications that bureaucracy introduces? Thereâs a trade-off: while bureaucracy can amass more information than an individual, much of it may get lost in transit. Non-experts within bureaucracies still access a greater pool of information than they would otherwise, despite the inefficiencies in its transmission.
As bureaucracies of experts grow larger, the volume of information gathered increases, but the reliability of that information tends to decline. This leads us to theorize that there exists an optimal size for expert bureaucracies (determining the precise level remains a topic for future exploration).
A secondary insight I hope to impart relates to the field of Public Choice. Scholars in this area, myself included, often focus too heavily on government or voter behavior. However, Public Choice was initially termed ânon-market decision-making.â The same challenges that plague governmental decision-making also infiltrate firms and other non-governmental organizations. While individual firms are not inherently more efficient than governments, market dynamics tend to penalize inefficient practices with financial loss, prompting profit-driven organizations to correct their missteps. In contrast, such corrective mechanisms are less prevalent in governmental contexts. Nonetheless, the pitfalls of non-market decision-making are evident within firms as well.
