Budget Processes: Theory and Experimental Evidence

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

No 2661, CEPR Discussion Papers from C.E.P.R. Discussion Papers

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. We show, using structurally induced equilibrium theory, that this need not be the case. To test the implications for budget processes of structurally induced equilibrium theory, we conduct a series of experiments. The evidence from these experiments supports the predictions of structurally induced equilibrium theory, both at the aggregate and at the individual subject level.

Keywords: Budget processes; Structurally induced equilibrium; Experimental economics (search for similar items in EconPapers)
JEL-codes: D71 H61 (search for similar items in EconPapers)
Date: 2001-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://cepr.org/publications/DP2661 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

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 (1999)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:2661

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP2661

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().