Public sector budgeting in European accounting and public ... · Public sector budgeting in European accounting and public management journals: Missing in action? A review by Eugenio

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Public sector budgeting in European

accounting and public management journals: Missing in action?

A review

by

Eugenio Anessi-Pessina

Università Cattolica del Sacro Cuore, Roma

Carmela Barbera

SDA Bocconi School of Management, Milano

Silvia Rota

Università di Bergamo

Mariafrancesca Sicilia

Università di Bergamo

Ileana Steccolini

Università Bocconi, Milano

and SDA Bocconi School of Management, Milano

[email protected]

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1. Introduction

Budgets play a central role in public organizations. In a narrow sense, the budget is the tool

through which governments decide how much to spend on what, limiting expenditures to the

revenues available and preventing overspending. In a broader sense, as emphasised by many

authors (e.g. Hyde 2001; Rubin 2010), the budget is a complex and eclectic tool, which has been

studied from different perspectives (political, economic, managerial), each focusing on a par-

ticular facet or function of public budgeting.

The political perspective has traditionally been predominant, following the seminal work by

Wildavsky (1964), who demonstrated the attractions of incremental budgeting to policy mak-

ers. In this perspective, the budget is an expression of public policy and political preferences.

Political scientists have thus emphasized the political dimension of the resource allocation

process among multiple, competing interests. In their view, budget decisions are an important

political arena used by internal and external stakeholders to strengthen their power. Internally,

politicians and managers struggle with one another to pursue the achievement of their particu-

lar goals; the amount of resources devoted to such goals thus becomes a performance indicator

of political and managerial action (Niskanen 1971). Externally, stakeholders reinforce the po-

litical nature of budgeting by organizing into interest groups in order to affect the allocation of

resources; this, by the way, raises the question of whether the budgeting process is sufficiently

democratic, considering that often only the most powerful interest groups have the power to af-

fect budget decisions. The relevance and the specific features of budgeting's political dimension

vary across organizations and over time according to such determinants as revenue trends, de-

grees of expenditure rigidity, composition of revenues and expenditures.

The economic perspective has become increasingly important with the expansion of the public

sector and of the government's responsibilities in "managing " the economy. In this perspective,

the budget is an instrument of fiscal policy, aimed at achieving macroeconomic objectives.

Economists analyse how public budgets are used to decide, implement, and communicate mac-

roeconomic policies. In their view, the budget is primarily a tool for affecting income distribu-

tion, stimulating economic growth, promoting employment, tackling inflation, encouraging eco-

nomic stability. Macroeconomic goals that can be pursued through public budgeting have been

classified in three main types: allocative, redistributive, and of stabilization (Musgrave and

Musgrave 1989).

The managerial perspective, finally, has gained importance following the processes of moderni-

zation that have affected the public sector in the last few decades (New Public Management -

NPM), promoting the adoption of managerial and market-based tools and mechanisms by public

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sector organizations in order to make them more efficient and performance driven (Ferlie et al.

1996). A fundamental component of this reform wave has been the innovation in financial and

accounting techniques and in the tools used to support day-by-day management (Hood 1991,

1995; Hogheim et al. 1998; Lapsley 1999). Within this context, the budget has also been re-

formed, placing an emphasis on its role as a key accounting and managerial / administrative

document at the organizational level. In the managerial perspective, the budget is a tool that

supports organizational action by limiting government spending by nature, purpose, and/or re-

sponsibility centre; allocating decision-making powers and responsibilities within the organisa-

tion; specifying how public services have to be provided; identifying the criteria by which ser-

vice provision is monitored, measured, and evaluated; aligning individual and organisational

goals. As a consequence, increased attention is paid to such elements as the alternative budget

formats, the types of information presented in the budget, the characteristics of the manage-

ment control system.

In the last few years, the need to improve and redesign budgeting systems has further in-

creased. The roles and features of budgets are becoming the object of new definitions, interpre-

tations, and purposes. The expanding weight of entitlements, the demands of supra- and inter-

national institutions, and the recent fiscal and economic crises have put enormous pressures on

cutting back expenditures, ensuring balanced budgets, and reducing the amount of accumulated

public debt. At the same time, public entities are expected to meet an increasingly sophisticated

and heterogeneous demand for services and to play a role in economic recovery and growth. As

a consequence, reaching a consensus on specific resource allocation decisions becomes more

and more complex, which translates into fragmented and continuous bargaining. New solutions

are thus needed to improve decision making and, ultimately, public sector performance.

To this end, a useful starting point is to review the approaches and methods through which pub-

lic budgeting has so far been tackled in the literature. Such is the purpose of this paper. More

specifically, the paper focuses on European academic journals that devote specific attention to

public-sector accounting and management issues. Section 2 describes the review's methodology

and Section 3 presents its results. Section 4, finally, draws some conclusions.

2. Methods

To pursue our purpose, we selected three European public management (PM) journals – Public

Management Review (PMR), International Journal of Public Sector Management (IJPSM), and

Public Money and Management (PMM). We also selected four European accounting (AC) jour-

nals that focus mainly (Financial Accountability and Management, FAM) or significantly (Ac-

counting, Organizations and Society, AOS; European Accounting Review, EAR; and Management

Accounting Research, MAR) on public sector accounting. The analysis was limited to academic

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journals because papers that have undergone peer review are more likely to meet the basic re-

quirements of theoretical and methodological rigour (Boyne 2003). This criterion excludes

studies published by government agencies and international organisations such as the Organi-

sation for Economic Cooperation and Development (OECD) and the World Bank.

Subsequently, we collected the papers on public budgeting that were published in all the issues

of the selected journals. We first browsed the titles and abstracts to identify the relevant papers

and then cross-checked the resulting list using the keywords “budget” and “budgeting”, matched

with “public”. The resulting list contained 87 papers, which were later reduced to 79 by exclud-

ing (i) editorials, (ii) papers that focused on budgeting in private-sector, defence-sector, or reli-

gious institutions, and (iii) papers that did not in fact focus on budgeting. Table 1 shows the

number of papers from each journal.

To classify the papers, we interactively developed a coding scheme. To this end, we began by

individually reading the papers and suggesting a possible classification. The various classifica-

tion proposals were discussed in order to converge on a common coding scheme of analysis,

which was tested on a sample of papers and further refined to reach a final version. We then

split into two groups, each of which read and coded all the papers in order to ensure reliability.

Finally, we compared the work of the two groups in order to identify, analyse and resolve all the

remaining differences. The final coding scheme includes the following dimensions:

• Geographic area, referring to the context where the paper's analysis was performed. In this

respect, we classified the papers by continent (Africa, Asia, Europe, North America, South

America, Oceania), with a further break down for Europe.

• Level of government, also referring to the context where the paper's analysis was per-

formed. In this respect, we distinguished among supra / international, national, and subna-

tional governments.

• Research method. In this regard, we distinguished between theoretical research (commen-

taries, normative papers, and literature reviews) and empirical research, with the latter fur-

ther classified as qualitative (analysis of issues, events, or practices by collecting non-

standardized data and analysing text and images rather than number and statistics) or

quantitative (analysis of frequencies and distributions of issues, events, or practices by col-

lecting standardized data and using number and statistics) (Flick 2009).

• Theory of reference. In this regard, we classified the 79 papers according to whether (i)

their main theoretical basis is NPM, (ii) they rely on other theories, or (iii) they have no ex-

plicit or clearly discernible theoretical framework.

Table 1 summarises the selected papers' distribution along these four dimensions.

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• In terms of geographic area, the great majority of papers (49) refer to European experiences

and cases. Oceania is also significantly represented (11), while North America accounts for

only 9 papers. Asia (with Malaysian and Japanese experiences) and Africa (the Uganda case)

are largely underrepresented; South America is completely absent. Out of the 49 European

studies, half focus on the UK or Ireland, and 12 on Scandinavian countries. The others refer

to Germany, the Netherlands, Italy, Spain and Portugal. There is thus a clear dominance of

the Anglo-Saxon tradition. This is consistent both with the general predominance of Anglo-

Saxon authors in international management and accounting journals and with the role of

these countries as pioneers and leaders in the processes of public sector modernization.

• In terms of levels of government, the majority of studies focus on the sub-national (37) and

national levels (27). Very few (3) deal with supra or international organisations. A relatively

large number (12), finally, fall into a residual category ("Other") as they offer comparisons

among different levels of government, focus on policy areas (e.g. education, health) that cut

across different levels of government, or refer to public sector organizations in general

terms.

• From a methodological viewpoint, the large majority of papers (73) adopt an empirical per-

spective, with a clear prevalence of qualitative methods (58). Only AOS (5 out of 15), FAM (9

out of 37) and IJPSM (1 out of 7) have published quantitative papers. Normative / theoreti-

cal papers, finally, are rare (6 out of 79).

• In terms of theoretical framework, finally, 35 of the 79 papers were classified as being

rooted in the NPM framework. Another 31 rely on other theoretical bases such as contin-

gency theory or institutionalism. The remaining 13 apparently lack a strong and clear refer-

ence to theory or are merely descriptive.

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Table 1: A classification of the 79 papers under analysis

MAR AOS EAR FAM IJPSM PMM PMR Total

Geographic area 3 15 1 37 7 14 2 79

Africa 0 0 0 0 1 0 0 1

Asia 0 0 0 2 1 0 0 3

Europe 3 5 1 27 1 11 1 49

UK and Ireland 3 1 0 12 0 8 0 24

Scandinavian countries 0 3 1 7 1 0 0 12

Germany, Italy, Netherl., Portugal, Spain 0 1 0 5 0 3 1 10

Other1 0 0 0 3 0 0 0 3

North America 0 6 0 1 2 0 0 9

South America 0 0 0 0 0 0 0 0

Oceania 0 3 0 6 1 0 1 11

Intercontinental comparisons 0 0 0 1 1 0 0 2

No specific reference 0 1 0 0 0 3 0 4

Level of government 3 15 1 37 7 14 2 79

Supra and international 0 0 0 3 0 0 0 3

National 2 0 0 12 4 8 1 27

Sub-national 1 11 1 20 1 2 1 37

Other 0 4 0 2 2 4 0 12

Research Method 3 15 1 37 7 14 2 79

Empirical qualitative 3 9 1 26 6 11 2 58

Empirical quantitative 0 5 0 9 1 0 0 15

Normative / Theoretical 0 1 0 2 0 3 0 6

Theory of reference 3 15 1 37 7 14 2 79

NPM reforms 3 0 0 12 5 13 2 35

Other theories of reference 0 15 1 15 0 0 0 31

No theory of reference 0 0 0 10 2 1 0 13

1 This group contains one cross-country comparison and two papers on European Union institution.

3. Results

The literature on budgeting has been significantly shaped by the advent of NPM.

in Section 2, NPM-inspired papers

1995, NPM-inspired papers systematically exceeded

ence” (see Figure 1).

Figure 1 - Number of papers by period and theory of reference

NPM is a label that indicates a set of practices aimed at innovating the traditional model of pu

lic administration by relying heavily on private

1995).

Empirical NPM-inspired papers are

descriptive. They generally present

country, level of government, or policy area.

AOS or EAR (see Figure 2).

0

2

4

6

8

10

12

1980-1985 1985-1990 1991

NPM reforms Other theories of reference

The literature on budgeting has been significantly shaped by the advent of NPM. As mentioned

inspired papers account for almost half of all the papers we analysed.

systematically exceeded those based on “other theories of refe

Number of papers by period and theory of reference

a set of practices aimed at innovating the traditional model of pu

relying heavily on private-sector concepts and techniques (Hood 1991,

papers are often qualitative (30 out of 35) and, in some cases,

present the implementation of budget innovations in a specific

country, level of government, or policy area. Most were published in PMM and FAM

1991-1995 1996-2000 2001-2005 2006-2010

Other theories of reference No theory of reference

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As mentioned

account for almost half of all the papers we analysed. After

her theories of refer-

a set of practices aimed at innovating the traditional model of pub-

sector concepts and techniques (Hood 1991,

, in some cases, merely

the implementation of budget innovations in a specific

PMM and FAM; none in

2011-2012

No theory of reference

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Figure 2 - Number of NPM-inspired papers, by journal and topic

Initially, the papers focused on the description of NPM-inspired reforms at a system-wide level

(tier of government or policy field) or, alternatively, on the recommended features of public

budgeting, often with a normative emphasis. Two features received particular attention: the

transition from cash to accruals and, in some cases, the supplementation of accounting informa-

tion with objectives expressed in terms of outputs and outcomes.

The need to replace the traditional cash basis with accruals is a recurring theme within NPM. In

most cases, however, the debate has focused on accounting and reporting, as opposed to budg-

eting, for at least three reasons: (i) the traditional view of public-sector budgeting and account-

ing as separate fields; (ii) the predominant role of accounting and financial reporting in the pri-

vate sector, that is, the sector from which NPM drew its inspiration; (iii) the emphasis placed by

NPM on the measurement of actual results. Nevertheless, papers do exist that, under a norma-

tive/conceptual or an empirical/descriptive approach, criticise the decoupling of accounting

and reporting from budgeting and suggest to extend the accrual basis from the former to the lat-

ter. According to Vela (1996), Guthrie (1998), Hepworth (2003), Anessi and Steccolini (2007),

Carvalho et al. (2006) and Lande and Rocher (2011), in particular, accruals accounting is bound

to play a limited role in public organisations if budgets are prepared solely under the cash basis,

and that the coexistence of accrual-based reports and cash-based budgets can mislead the in-

terpretation of a government’s financial situation. Other papers, focusing specifically on the

UK's "Resource accounting and budgeting" (RAB) initiative, point out the potential benefits of

accrual-based budgeting: better information and incentives to manage assets; better incentives

in planning investments; and, more generally, a new impetus to bring under control the sustain-

0

2

4

6

8

10

12

14

MAR FAM IJPSM PMM PMR

Budget and output/outcome at micro level Accrual budgeting and related issues

Accrual budgeting and its impacts Budget and output/outcome at macro level

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ability of public finances by highlighting the long-term consequences of current decisions. The

same papers identify some critical issues posited by the introduction of accrual-based budgets,

such as the the accounting treatment of problematic elements of the financial statements (Mc

Geough 1998; Gillibrand and Hilton 1998; Chan 2003; Likierman, 1998; Likierman 2003; Hep-

worth 2003; Adam and Behn 2006), the rise of creative accounting (Perrin 1998), the need to

make non-accountants enable to understand and use the new information (Likierman 2000).

More recently, an increasing number of papers intends to analyse the actual impacts of accrual-

based budgeting at the organizational level, often showing that reforms have fallen short of ex-

pectations (Pallott 2001; Ridder et al 2006; Hyndman et al. 2007; Hyndman ad Connolly 2011;

Jagalla et al 2011; Jones and Luder 2011).

The supplementation of accounting information with objectives expressed in terms of outputs

and outcomes was also discussed in a significant number of papers (in some cases, the same pa-

pers that discuss the transition to accrual-based budgets). This innovation has been interpreted

at two different, but interrelated levels. At the macro (i.e,, policy, system or country) level, out-

puts and outcomes can be used to allocate resources among different agencies or departments

(resource or programme budgeting) (Wilks 1995; Likierman 2000; Likierman 2001; Carlin and

Guthrie 2003; Midwinter 2005; Carlin 2006; Bissessar 2010). Authors highlight that the imple-

mentation of this allocation mechanism does not necessarily imply an improvement at the

managerial level, since it requires a change of the internal operating structures. At the micro

(i.e., organizational or managerial) level, on the other hand, managers use non-financial infor-

mation for improving the performance of those organizational units under their responsibility

(Bourn and Ezzamel 1987; Alam and Lawrence 1994; Awio and Northcott 2001; Nyland and

Pettersen 2004; Pettersen and Solstad 2007; Yahya et al. 2008; Macinati 2010). Papers referring

to the organisational level usually describe experiences drawn from the health care and the

educational sectors.

Beside NPM-inspired papers, the other large subset is composed of papers (31) that were classi-

fied as relying on “other theories of reference”2. These papers have been mainly published by

AOS and FAM, are mainly empirical qualitative (18 out of 31) and, in some cases, quantitative

(11 out of 31). The remaining 2 papers use a theoretical approach. Most of them are based on

institutional theory; a few take a contingency or incrementalist stance; some contain a combina-

tion of theoretical approaches (see Figure 3).

2 Whether NPM can be considered a theory is debatable, but is outside the remit of this paper.

Figure 3 - Papers with “other theories of reference”

The papers that we classified as “contingency based” share some common features.

investigate public budgeting as a managerial tool intended to keep managers

sation, accountable for the use of resources and

ness is not particularly emphasis

goal is to contribute to the existing

of the organisations under analysis is

however, this ends up highlighting the peculiarities of the public

than in the NPM-inspired literature

ond, from a methodological viewpoint, these papers share an approach that can be described as

static and quantitative. More specifically, t

surveys, to assess the relationship between

one hand (Abernethy and Stoelwinder 1991)

(Abernethy and Stoelwinder 1989

between budget features and performance (Williams et al 1990), or

mediating tool between strategic change process

1999). Because these papers extend over the entire period under consideration, some of them

clearly reflect the presence of managerial refo

The contingency approach is rooted on a static

sharply distinguishes it from the institutional approaches

cultural dimensions, determinants and implications of budgets, often adopting a dynamic and

0

2

4

6

8

10

12

14

16

AOS

Combination of theoretical approaches

Incrementalism

with “other theories of reference”, by journal and theory of reference

The papers that we classified as “contingency based” share some common features.

investigate public budgeting as a managerial tool intended to keep managers, within an organ

accountable for the use of resources and the production of outputs. The issue of publi

sed in that the focus is on budgeting and its determinants. The

existing body of knowledge on budgeting in general. T

ations under analysis is viewed simply as a contextual element. Paradoxically,

however, this ends up highlighting the peculiarities of the public-sector context

inspired literature, where such peculiarities are commonly downplayed.

ological viewpoint, these papers share an approach that can be described as

More specifically, they rely on quantitative data, often collected through

to assess the relationship between organisational and environmental fac

Abernethy and Stoelwinder 1991) and budget uses and behaviours

1989; Goodwin and Kloot 1996; Serritzlew 2005), the relationship

budget features and performance (Williams et al 1990), or the role of budgeting as a

mediating tool between strategic change processes and performance (Abernethy and Brownell


clearly reflect the presence of managerial reforms.

The contingency approach is rooted on a static, instrumental, and rational view of budgets. This

sharply distinguishes it from the institutional approaches, which emphasise the political


EAR FAM

Combination of theoretical approaches Institutional theory

Contingency theory

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, by journal and theory of reference

The papers that we classified as “contingency based” share some common features. First, they

within an organi-

. The issue of public-

ed in that the focus is on budgeting and its determinants. The

The publicness

Paradoxically,

sector context much better

are commonly downplayed. Sec-

ological viewpoint, these papers share an approach that can be described as

collected through

factors on the

and budget uses and behaviours on the other

the relationship

the role of budgeting as a

and performance (Abernethy and Brownell


and rational view of budgets. This

e the political and


FAM

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processual perspective (Christensen and Laegrid 2012). Indeed, “institutional based” papers

tend to study the dynamics of the budgetary process or the changes in budgetary processes.

More specifically, during the 1980s the focus was on the budgetary process; in the 1990s it

shifted towards the changes in the budgetary process. The 1980s, moreover, were characterised

by studies of budgeting in the public sector, with cases chosen in order to contribute to the gen-

eral literature on budgeting; the 1990s, on the contrary, produced studies on the public sector,

aiming at a better understanding of the reforms under way in the public realm. The studies car-

ried out in the 1980s pay particular attention to the underlying cultural and political processes.

Covaleski and Dirsmith (1983, 1986, 1988) and Giroux et al. (1986), for example, emphasise the

role of budgets in the construction of reality and the perpetuation of power. Boland and Pondy

(1986) pinpoint the dual structure of accounting and the importance of studying the interaction

between the instrumental and symbolic logics of budgeting. Czarniawska and Jacobsson (1989),

finally, focus specifically on the cultural dimension and put forward the view of budgets reflect-

ing “a way of expressing and enforcing some dominant values in the typical context of Western

contemporary organizations: rationality, consensus and progress”. The papers published in the

1990s, in turn, share large similarities in that, while looking at the changes affecting public

budgeting processes: (i) they predominantly adopt a neo-institutional approach, (ii) they con-

clude that managerial public-sector reforms are jeopardised by the decoupling between ritualis-

tic practices and actual behaviours. Some of them simply highlight the presence of decoupling

and the question of isomorphism (Pettersen 1995; Brusson 1995; Edwards et al. 1995; Groot

1999; Edwards et al. 2000). Others delve deeper into internal dynamics (Moll and Hoque 2011;

Ezzamel et al. 2012). Only one of the papers analysed adopts old institutional economics as a

framework for studying the role of institutionalisation practices in change processes (Hyvonen

and Jarvinen 2006).

A fair number of papers could not be univocally classified under one theory in that they either

compare or combine different approaches. Among the latter, Seal (2003), Seal and Ball (2011)

and Colville (1989) suggest that incrementalism has an institutional nature and thus propose a

hybridization of the two streams. Among the former, Reddick (2003) proposes a quantitative

analysis to compare three rival decision-making theories (garbage can, incrementalism, and ra-

tional) and identify which is more consistent with empirical data.

The other papers in this subset, finally, were qualitative and usually less explicit in their com-

parison between different theories. A significant group (Williams 1981; Jonsson 1982;

Samuelson 1986; Rege 1986; Hogheim et al 1989) starts off from the normative literature (on

PPBS-Planning Programming Budgeting System, ZBB-Zero Based Budgeting, budgeting proc-

esses) and highlights the gaps between these suggestions and actual practices. In a discussion of

management control practices, for instance, Hogheim et al. (1989) covered the relations be-

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tween the world of budget decisions and reporting and the world of action. Rege (1986), on the

other hand, proposed a new conceptual and theoretical model (PIPES-Planned incremental

package evaluation system) which was supposed to provide the budget officer with a more

comprehensive system, encompassing a variety of modern management principles.

The NPM-inspired papers and the papers that rely on “other theories of reference” cumulatively

account for 66 of the 79 papers under analysis. The remaining 13 were classified as having no

explicit or clearly discernible theoretical framework. Of these, four (Bellamy and Kluvers 1995;

Xavier 1996; McGill 2001; Andrews 2004) do not explicitly refer to the NPM movement, but

present program budgeting reforms introduced in Asia, Oceania, North America and, compara-

tively, Tanzania and India. These papers analyse actual applications of program budgeting and

try to discuss the preconditions and factors that can affect the successful implementation of

program budgeting initiatives. As to the other nine papers, published in FAM and IJPSM, they

generally illustrate the accounting and budgeting systems of a supra-national (European Un-

ion), national (UK and Ireland), or local tier of government (Japan and European countries com-

parison), with a fundamentally descriptive aim (Taylor 1989; Thain and Wright 1989; Skousen

1990; Yoshida 1990; Edsberg 1994; Levy 1994; Jegers 1996; Jones 2000; Midwinter 2010).

Their specific topics include the importance of users and user needs as opposed to technical pu-

rity alone, the factors affecting the reforms, the identification of general strengths and weak-

nesses of current budgeting practices in a given period of time.

4. Discussion: trends in European public budgeting studies

The review presented in this paper highlights some interesting patterns in the European litera-

ture on public budgeting.

First, considering the well-established relevance of the topic, relatively little work has been

published in Europe on public budgeting in the last thirty years. In our review, we included

seven journals: three public management journals as well as four accounting journals that focus

mainly or significantly on public-sector accounting. However, we found only 79 relevant papers.

Admittedly, some of these journals are relatively recent, and for others the oldest volumes are

not downloadable in electronic format. Traditionally, moreover, budgeting was generally

viewed as lying outside the scope of both public management and public-sector accounting -

which also explains why the oldest papers in our selection often focus on particular organisa-

tions, like hospitals. Even in more recent years, however, the number of relevant papers has

remained rather low.

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Second, the existing papers on public budgeting appear to be significantly under-theorized. Of

the 79 papers we analysed, only 31 are based on a full-fledged theoretical framework such as

contingency theory or institutionalism. Another 13 apparently lack a strong and clear reference

to theory, or are merely descriptive. The remaining 35, finally, are rooted in the NPM frame-

work. In this last group of papers, most simply provide a description of NPM-inspired reforms

at a system-wide level (tier of government or policy field) or, alternatively, illustrate with a

normative emphasis the recommended features of public budgets. NPM, in other words, did

stimulate a strong debate among academics and did force public management and government

accounting scholars to consider and understand private-sector concepts and techniques, as well

as to assess their applicability to the public sector. At the same time, however, NPM has failed to

develop a proper theory of public budgeting as a political and managerial tool at the individual

organisation's level, nor has it sufficiently emphasised the "publicness" of public-sector entities.

In fact, its long-term dominance of the public-sector literature has probably hampered the de-

velopment of such a proper theory. This is also reflected in the temporal evolution of the 31 pa-

pers that we have classified as being based on a full-fledged theoretical framework. During the

1980s, these were mostly papers about budgeting in the public sector, which aimed at contrib-

uting to the general literature on budgeting. In later periods, even this group of papers was

strongly affected by the advent of NPM. These later papers can thus be described as studies on

the public sector: their main purpose is to achieve a better understanding of the reforms under

way in the public realm; their main focus is not on budget contents and processes per se, but

rather on changes in budgeting, typically during the implementation of reform initiatives.

Third, European authors clearly prefer qualitative research to quantitative analyses. This re-

flects a specific interest in the evolutionary and contextual aspects of budgeting. As mentioned,

however, the qualitative analyses presented in the majority of these papers are merely descrip-

tive or exploratory and consequently far from adopting an explanatory stance. Many of them

limit themselves to descriptions of reforms and related pros and cons. This reveals a methodo-

logical weakness in budgeting studies.

Fourth, most studies focus on Anglo-Saxon countries. On the one hand, this reflects the Anglo-

Saxon centeredness of many European journals (although with differences), combined with the

low propensity of some Continental European academic communities to publish at the interna-

tional level. On the other hand, it probably mirrors the stronger level of commitment and impact

of managerial reforms in general, and budgeting reforms specifically, in the Anglo-Saxon con-

text. It is also interesting to notice that European journals are open to contributions from non-

European authors and experiences, but there is a deafening silence from South America, Africa

and Asia.

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Finally, the review carried out in this paper points out interesting patterns in the publishing

policies of the analysed journals. FAM appears to be the preferred outlet for publication in this

field and the most open to diversity in terms of geographical area, levels of government ana-

lysed, research methods, theoretical frameworks. A fair degree of diversity can also be found in

AOS, especially in terms of methods and geographic areas. PMM and MAR appear to be very fo-

cused on qualitative studies set in the UK and Ireland, whereas IJPSM is keener on developing

countries. PMR, MAR and EAR, finally, have so far shown no particular interest in the theme of

budgeting in the public sector.

5. Gaps and future research avenues

The review suggests several avenues for future research.

First, budgeting does not appear to have played a central role in European public management

and accounting research and, thus, more studies are required to close this gap. Public manage-

ment journals should be interested in budgeting in that budgeting is a key component of public

organisations' governance arrangements (both at the inter- and the intra-organisational levels)

and a fundamental management tool (in its political, instrumental, and cultural roles). Journals

with a focus on public-sector accounting should be interested in budgeting in that budgeting is

profoundly and inevitably intertwined with accounting and reporting. Accounting journals

should be interested in public budgeting in that it can open new views also for general account-

ing scholars.

Second, more theoretically informed and methodologically sound qualitative research is re-

quired to gain a better understanding not only of budgeting reforms, but also of budgeting fea-

tures, players, and processes, and, thus, to support the development of an explanatory theoreti-

cal framework for budgeting. This framework should try to combine evolutionary and

static/cross-sectional views of budgeting and would benefit from the adoption of an organiza-

tional view of processes, rather than a system-wide one. More specifically, future research

should (i) overcome the limits of a purely technical view of budgeting, paying attention to both

managerial and political rationalities, to both budget contents and decision-making processes,

to both internal dynamics and inter-organisational interactions; (ii) pay greater attention to the

link between reporting, performance measurement, and their role in the budgeting process; (iii)

embrace a dynamic and processual view; (iv) identify the environmental and organisational

variables that are relevant today in explaining budgetary behaviour at all levels of government.

In this regard, multiple case studies could be particularly helpful. Qualitative research might be

enriched through the use of discourse analysis and multiple case studies, and also be supple-

mented by experimental and quantitative analyses.

15

Third, considering the current financial crisis, budgeting under austerity should be the focus of

particular attention. In other words, it would be appropriate to analyse how austerity condi-

tions and policies are shaping budgetary contents and processes. In this respect, it is worth no-

ticing that, although history never exactly repeats itself, several papers dating back a few dec-

ades sound strangely familiar and contemporary.

Finally, more studies should be undertaken on continental Europe and developing countries, as

well as on cross-country comparisons.

16

5. References

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