Budgeting in Times of Fiscal Stress: Explaining Strategies for Reducing Agency Expenditures

Abstract

This research compared budget coping strategies of state administrative heads in public state agencies focusing on the influences of executive administrator characteristics, and organizational characteristics. Budget theory and cutback management with organizational theory is used in this research in conjunction with Lowi?s public agency model. The research is supplemented with data from survey research in an effort to frame the relationship between the types of budget strategies used by state administrators during times of fiscal austerity. Quantitative analysis is utilized relying on survey data obtained from the 2004 survey of the American State Administrators Project (ASAP). This project surveyed state agency administrators across the country in over 80 fields. The population size used in this study was 943 cases in the 2004 survey. Fourteen hypotheses were developed for this study; they are divided evenly among administrator variables and organizational variables. Crosstabulation and binary logistic regression (logit) is used to analyze the data in this study. Results of this analysis show that organizational variables were found to have more influence on administrator choice of budget coping strategy than administrator characteristics. Organizational size (number of employees) and organizational budget size showed many statistically significant associations with the budget coping strategies. The control variable divided government also has influence across all model types in influencing the administrator?s choice of budget coping strategy. The premier budget coping strategy is identified as hiring freeze.