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Models of Municipal Budget Allocation: Empirical Data from Spanish Municipalities
Author(s) -
DORTAVELÁZQUEZ JOSÉ A.,
DE LEÓNLEDESMA JAVIER,
PÉREZRODRÍGUEZ JORGE V.
Publication year - 2010
Publication title -
public budgeting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.694
H-Index - 30
eISSN - 1540-5850
pISSN - 0275-1100
DOI - 10.1111/j.1540-5850.2010.00955.x
Subject(s) - incrementalism , economics , work (physics) , sample (material) , panel data , econometrics , political science , mechanical engineering , chemistry , chromatography , politics , law , engineering
The present work empirically analyzes diverse budgetary theories (incrementalism, garbage can, rational) in municipal cost programs, paying special attention to the utility of financial information in decision making. The sample analyzed corresponds to a set of Spanish city councils in the period 1996–2004, and the econometric methodology used is a dynamic panel data model. The main conclusion reached is that the budgetary allocation of municipal costs does not follow a random path; incrementalism is of particular importance, together with financial information variables. The utility of budgetary indicators is reflected in the fact that municipal managers adopt rational elements, although incrementalism remains the habitual behavior.