Political principals face high-powered electoral pressures while bureaucrat-agents face longer
term, low-powered incentives. Given constitutional constraints, what "carrots and sticks" do
politicians employ to control bureaucrats and how do bureaucrats respond to such incentives?
We use a simple career concerns framework and a unique dataset from the Indian Administrative Service to address these issues. State level politicians (Chief Ministers) exert control over
bureaucrats when they assume office, through a novel mechanism of reassignment (transfers)
to new jobs. Transfers are less likely if district politicians belong to the same party as the Chief
Minister, i.e. he appears to treat local politicians and bureaucrats as substitutes. We use a
framework where bureaucrats differ in their willingness to invest in job expertise or political
loyalty. Consistent with this framework, we find in our data that more able bureaucrats and
those with greater job-specific experience are less likely to be reassigned when a new politician
assumes office. In accordance with politicians district reassignment patterns, we do not find robust evidence of any negative impact of such politically-induced transfers on development
and policy outcomes at the district level
