Budget Processes: Theory and Experimental Evidence

Karl-Martin Ehrhart, Roy Gardner, Juergen von Hagen and Claudia Keser

Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems from Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich

Abstract: This paper studies budget processes, both theoretically and experimentally. We compare the outcomes of bottom-up and top-down budget processes. It is often presumed that a top-down budget process leads to a smaller overall budget than a bottom-up budget process. Ferejohn and Krehbiel (1987) showed theoretically that this need not be the case. We test experimentally the theoretical predictions of their work. The evidence from these experiments lends strong support to their theory, both at the aggregate and the individual subject level.

Keywords: Budget processes; voting equilibrium; experimental economics (search for similar items in EconPapers)
JEL-codes: C91 C92 H61 (search for similar items in EconPapers)
Date: 2006-03
New Economics Papers: this item is included in nep-cdm, nep-exp and nep-pbe
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https://epub.ub.uni-muenchen.de/13405/1/146.pdf (application/pdf)

Related works:
Journal Article: Budget processes: Theory and experimental evidence (2007)
Working Paper: Budget Processes: Theory and Experimental Evidence (2006)
Working Paper: Budget processes: theory and experimental evidence (2004)
Working Paper: Budget Processes: Theory and Experimental Evidence (2004)
Working Paper: Budget Processes: Theory and Experimental Evidence (2001)
Working Paper: Budget processes: Theory and experimental evidence (2000)
Working Paper: Budget Processes: Theory and Experimental Evidence (1999)
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Persistent link: https://EconPapers.repec.org/RePEc:trf:wpaper:146

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