An Integrated Theory of Budgetary Politics and Some Empirical Tests: The U.S. National Budget, 1791–2010

Abstract

We develop a general theory of budgetary politics and examine its implications on a new data set on U.S. government expenditures from 1791 to 2010. We draw on three major approaches to budgeting: decision-making theories, primarily incrementalism and serial processing; policy process models; and path dependency. We show that the incrementalist budget model is recursive and that its solution is exponential growth, and isolate three periods in which it operates in pure form. The equilibrium periods are separated by critical junctures, associated with wars or economic collapse. We assess policy process dynamics by examining the deviations within equilibrium periods. We offer three takeaways: (1) exponential incrementalism is fundamental to a theory of budgeting; (2) disjoint shifts in the level of exponential incrementalism are caused only by critical moments; (3) temporally localized dynamics cause bends in the exponential path, longer returns to the path within budgetary eras, and annual punctuations in budget changes. Decision-Making TheoriesDecision-making theories focus on how budget actors decide allocations. Actors themselves are grouped by institutional role, so the decision-making theories focus both on institutional interactions and the cognitive capacities

Interest groups and policy volatility

“…Moreover, in the case of budgets, issues that enjoy a high agenda position are also likely to occupy significant portions of the overall distribution of dollars within a budget. Similar to the findings of Jones, Zalányi, and Érdi (), even incremental changes can be large in real terms if the base is large, too. Thus, incremental changes can be major victories.…”

Punctuated equilibrium in democracy and autocracy: an analysis of Hungarian budgeting between 1868 and 2013

“…A series of empirical studies confirmed punctuated equilibrium, this alternative to classic incrementalism, for a range of US and Western European jurisdictions (Breunig, 2006(Breunig, , 2011Breunig and Koski, 2006;Baumgartner et al, 2009;Breunig et al, 2009;Jones et al, 2014). These confirmatory results prompted the formulation of a 'general empirical law of public budgets' (Jones et al, 2009).…”

“…Accordingly, large-scale data collection and coding projects were started (see, e.g. Breunig et al, 2009;Jones et al, 2014).…”

Point Predictions and the Punctuated Equilibrium Theory: A Data Mining Approach—U.S. Nuclear Policy as Proof of Concept

“…All the single effects from Figure 1 have been analyzed empirically as well as theoretically: the filtering of information, limited attention in the agenda-setting process, institutional friction, and the leptokurtic behavior of policy outcomes. On the other hand, especially some of the latest contributions in PET have focused on the macro level of the whole process of information processing rather than on decisive policy changes (Breunig & Koski, 2012;Jones, Sulkin, & Larsen, 2003;Jones et al, 2009;Jones, Zalányi, & Érdi, 2014).…”