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Introduction
The interaction between the United States Courts of Appeals and the United States Supreme
Court has gained much attention in recent years. Many scholars have asserted that the relationship
between these two institutions can be explained by the principal-agent theory that was originally
established by scholars to describe the functioning of bureaucracies (Songer, Segal, and Cameron 1994;
Benesh 2002). According to this theory, agents, which can be described as the subordinates in the
hierarchy, exist to serve the needs of the principals, or those who are at the top of the hierarchy (Miller
and Moe 1986). However, given the limited resources of the principals in their ability to monitor the
agents, agents can be expected to shirk and follow their own policy preferences instead of following the
wishes of their principals (Miller and Moe 1986). When applied to the judicial system, the Supreme
Court acts as the principal, and it is the job of the Courts of Appeals to follow the precedents set forth by
their principal. However, since judges on the Courts of Appeals also have their own policy preferences
they can be expected to shirk and follow their own wishes when they do not agree with the wishes of the
Supreme Court and when they believe the chances of being monitored are low (Songer, Segal, and
Cameron 1994; Benesh 2002).
Using the Establishment Clause cases involving schools in the Courts of Appeals, this paper will
measure the extent to which the principal-agent theory applies to the judicial system. By employing a
fact-pattern analysis my paper will answer the following questions: 1.) To what extent do the Courts of
Appeals follow their principal? and 2.) Under what circumstances are the Courts of Appeals more likely
to be faithful agents by following the precedents set by the Supreme Court? Finding the answers to these
questions will help us understand the true influence that the Supreme Court has on policy making in the
United States since the Supreme Court can only implement policies by relying on agents like the U.S.
Court of Appeals.
Decision-Making in the Courts of Appeals
Most large scale studies of judicial decision-making have, until very recently, been conducted at
the Supreme Court level. However, it is important that we begin studying decision-making at the lower
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