Combining Incrementalism and Exogenous Factors in Analyzing National Budgeting: An Application to Spain

Instituto de Estudios Fiscales Working Paper No. 7/2010

55 Pages Posted: 13 Jun 2010

See all articles by José Caamaño-Alegre

José Caamaño-Alegre

University of Santiago de Compostela - Department of Applied Economics

Santiago Lago-Peñas

University of Vigo, GEN (Governance and Economics Research Network)

Date Written: June 11, 2010

Abstract

This paper focuses on the impact of both incrementalism and exogenous factors in budgeting. After a survey of related literature, we present a doubledistinction-based proposal combining incrementalism and exogenous factors to analyze national budgeting. Two of the four resulting approaches are then applied to the case of Spain. We combine several statistical tools to avoid the shortcomings of the Davis, Dempster and Wildavsky econometric method and its extensions appearing in the literature of the 70s and 80s. Results suggest that incrementalism explains changes in budgeted figures remaining within relatively narrow bands, but additional variables are needed to explain: i) the dynamics of marginal change in the budget total, and ii) the non incremental changes within the budget.

Keywords: budgetary incrementalism, public spending, Spanish government

JEL Classification: H61, H50, H83

Suggested Citation

Caamaño-Alegre, José and Lago-Peñas, Santiago, Combining Incrementalism and Exogenous Factors in Analyzing National Budgeting: An Application to Spain (June 11, 2010). Instituto de Estudios Fiscales Working Paper No. 7/2010, Available at SSRN: https://ssrn.com/abstract=1623644 or http://dx.doi.org/10.2139/ssrn.1623644

José Caamaño-Alegre

University of Santiago de Compostela - Department of Applied Economics ( email )

Facultad de Derecho
Campus Vida, s/n
Santiago de Compostela, 15782
Spain
(+34)981-563100, ext. 14764 (Phone)
(+34)981-591554 (Fax)

Santiago Lago-Peñas (Contact Author)

University of Vigo, GEN (Governance and Economics Research Network) ( email )

Ourense, Ourense 32004
Spain

HOME PAGE: http://webs.uvigo.es/infogen

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