Budget Dynamics

Abstract

Budget dynamics may sound as a contradiction in terms to scholars familiar with Wildavsky and colleagues' seminal work on public budgeting (Wildavsky 1964). As stated by Davis, Dempster, and Wildavsky (1966, 529): “This year’s budget is based on last year’s budget, with special attention given to a narrow range of increases or decreases.” For some years this simple model was considered something of an empirical law of public budgets. However, already in the 1970s several scholars started to question the empirical validity of Wildavsky’s claim. John F. Padgett (1980) argued that the linear assumptions in normal regression statistics were too resistant to non-linear variation in data. In addition to this methodological criticism, rigorous theoretical criticism has claimed that the concept of incrementalism has never been clearly defined (Dempster and Wildavsky 1979; Berry 1990). But perhaps the most serious problem is that the incrementalism description of stable public budgets simply does not seem to find support in empirical observations. Most studies find periods of stability, but they also find significant and large changes that cannot be accounted for using the incremental Approach (Natchez and Bupp 1973). Although the reputation of incrementalism as a very static model of public budgeting may be a little unfair, the approach is definitely not well suited to account for large changes in public spending. Nevertheless, alternative explanations of this pattern of both stability and changes have been few, and for many years, as True (2000, 4) puts it: “we have been left with incrementalism by default.” In the past decade, however, the interest in stability and change in public budgeting has been revitalized and in this article we Highlight some of the main findings and insights of this research agenda.