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A model of policy implementation in a parliamentary democracy as delegation between the prime minister and her cabinet ministers is introduced. Cabinet reshuffles can be pursued as a strategy to reduce the agency loss which occurs due to the different preferences of the actors. This work thus explains why prime ministers resort to reshuffles: cabinet reshuffles reduce the moral hazard facing ministers. This answer both augments and distinguishes this work from traditional perspectives on reshuffles that have emphasized the deleterious effects of reshuffles on ministerial capacity, and also from recent work that casts reshuffles as solutions to the adverse-selection problems inherent in cabinet government. The conclusion offers a preliminary test of some of the hypotheses generated by this theory.
Indridason et al. (Mon,) studied this question.