Meritocracy and Dual Leadership
Historical Evidence and an Interpretation
This paper studies the origins of bureaucratic capacity, both empirically and theoretically. I apply textual analysis to Chinese historical records; from these records, I construct a novel dataset tracing the evolution of political institutions for over 1,300 years. The dataset uncovers a key empirical regularity: a meritocratic bureaucracy arose only after emperors established a strong “separation of powers” among provincial officials, an institution also correlated with a much lower frequency of revolts. To explain these findings, I construct a model where the central government faces a loyalty-competence trade-off: a competent governor can weaponize his competence to challenge the central government. I show that the central government resolves the trade-off by appointing a political governor and an economic governor to co-rule a province. Case studies further show that the separation between economic and political powers is an important hallmark in many stable autocracies.