Budgetary decision making in the twentieth century: theories and evidence

Three rival internal change theories of budgeting have characterized the twentieth century. Internal change theories consider the importance of change made inside governments; exogenous factors do not have a significant bearing on outcomes in these approaches. The century started out with the rational/scientific, then moved to incrementalism by mid to latecentury. The century ended with the garbage can model. This paper tests the descriptive power of each of these models on budget outcome data. The methods used in this study were time series modeling of monthly U.S. national government budget outcomes from 1968 to 1999. The results provide support for both incrementalism and rational/scientific budgeting. There was no support found in this study for the anarchical tendencies associated with the garbage can theory of budgeting. These results suggest that the garbage can model may not deserve its reputation as the dominant budgeting paradigm at the close of the twentieth century.