Budget theory is the academic study of political and social motivations behind government and civil society

budgeting A budget is a calculation play, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environmen ...

. Classic theorists in

Public Budgeting Public budgeting is a field of public administration and a discipline in the academic study thereof. Budgeting is characterized by its approaches, functions, formation, and type. Authors Robert W. Smith and Thomas D. Lynch describe public budgetin ...

include

Henry Adams Henry Brooks Adams (February 16, 1838 – March 27, 1918) was an American historian and a member of the Adams political family, descended from two U.S. Presidents. As a young Harvard graduate, he served as secretary to his father, Charles Fra ...

, William F. Willoughby, V. O. Key, Jr., and, more recently,

Aaron Wildavsky Aaron Wildavsky (May 31, 1930 – September 4, 1993) was an American political scientist known for his pioneering work in public policy, government budgeting, and risk management. Early years A native of Brooklyn in New York, Wildavsky was th ...

. Notable recent theorists include Frank R. Baumgartner,

Bryan D. Jones Bryan D. Jones is an American Political science, political scientist and public policy scholar. He holds the J. J. "Jake" Pickle Regents Chair in Congressional Studies at the University of Texas. He is an Academic Director of the Comparative Agend ...

Richard Fenno Richard Francis Fenno Jr. (December 12, 1926 – April 21, 2020) was an American political scientist known for his pioneering work on the U.S. Congress and its members. He was Distinguished University Professor Emeritus at the University of Roche ...

Allen Schick Allen Schick is a governance fellow of the Brookings Institution and also a professor of political science at the Maryland School of Public Policy of University of Maryland, College Park. He is known as an authority on budget theory and the feder ...

Dennis Ippolito Dennis Stephan Ippolito (born 1942) is a professor of political science at Southern Methodist University and considered a leading historian and expert on governmental budget theory. He has written several books on the topic including ''Why Budgets ...

, Naomi Caiden,

Irene Rubin Irene Sharp Rubin (born May 3, 1945) is an American political scientist, currently a Professor Emerita of Public Administration at Northern Illinois University. She researches the politics of public budgeting at various levels of American governm ...

James D. Savage James D. Savage (born November 14, 1951) is a political science professor at the University of Virginia who teaches public policy in the Department of Politics and the Frank Batten School of Leadership and Public Policy. He is an expert in governmen ...

, Thomas Greitens, Gary Wamsley, and Usman W. Chohan. Budget theory was a central topic during the

Progressive Era The Progressive Era (late 1890s – late 1910s) was a period of widespread social activism and political reform across the United States focused on defeating corruption, monopoly, waste and inefficiency. The main themes ended during Am ...

and was much discussed in municipal bureaus and other academic and quasi-academic facilities of that time such as the nascent

Brookings Institution The Brookings Institution, often stylized as simply Brookings, is an American research group founded in 1916. Located on Think Tank Row in Washington, D.C., the organization conducts research and education in the social sciences, primarily in ec ...

. The

executive budget The executive budget is the budget for the executive branch of the United States government. It was established as one of the reforms during the Progressive Era and became a federal policy in 1921 under the Woodrow Woodrow Wilson, Wilson Administra ...

in United States was a financial innovation designed to empower city mayors and city managers with the capacity to implement needed policy reforms in the

. Since that time, the executive budget has become a tool by which the president of the United States has been able to substantively shape policy and draw power to the president from Congress, which was originally charged with "holding the purse" (and still is constitutionally, as there is no federal-legislative authority to change the constitution outside the amendment process or for congress to legislate away their authority). This has resulted in an ever increasing role and power base for what is now called the

Office of Management and Budget The Office of Management and Budget (OMB) is the largest office within the Executive Office of the President of the United States (EOP). OMB's most prominent function is to produce the president's budget, but it also examines agency programs, pol ...

Budget, Civil society and Constitutional economics

Constitutional economics Constitutional economics is a research program in economics and constitutionalism that has been described as explaining the choice "of alternative sets of legal-institutional-constitutional rules that constrain the choices and activities of economi ...

is a field of

economics Economics () is the social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services. Economics focuses on the behaviour and intera ...

and

constitutionalism Constitutionalism is "a compound of ideas, attitudes, and patterns of behavior elaborating the principle that the authority of government derives from and is limited by a body of fundamental law". Political organizations are constitutional ...

which describes and analyzes the specific interrelationships between constitutional issues and functioning of the economy including

budget process A budget process refers to the process by which governments create and approve a budget, which is as follows: * The Financial Service Department prepares worksheets to assist the department head in preparation of department budget estimates * The A ...

. The standards of constitutional economics when used during annual

budget A budget is a calculation play, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environmenta ...

planning, as well as the latter's transparency to the society, are of the primary guiding importance to the implementation of the

rule of law The rule of law is the political philosophy that all citizens and institutions within a country, state, or community are accountable to the same laws, including lawmakers and leaders. The rule of law is defined in the ''Encyclopedia Britannica ...

. Also, the availability of an effective court system, to be used by the

civil society Civil society can be understood as the "third sector" of society, distinct from government and business, and including the family and the private sphere.government A government is the system or group of people governing an organized community, generally a state. In the case of its broad associative definition, government normally consists of legislature, executive, and judiciary. Government is a ...

spending and executive

impoundment Impoundment may refer to: Water control * The result of a dam, creating a body of water ** A reservoir, formed by a dam ** Coal slurry impoundment, a specialized form of such a reservoir used for coal mining and processing * Impounded dock, an enc ...

of any previously authorized appropriations, becomes a key element for the success of any influential civil society. The term “constitutional economics” was used by American economist –

James M. Buchanan James McGill Buchanan Jr. (; October 3, 1919 – January 9, 2013) was an American economist known for his work on public choice theory originally outlined in his most famous work co-authored with Gordon Tullock in 1962, ''The Calculus of Consen ...

– as a name for a new academic sub-discipline that in 1986 brought him the

Nobel Prize in Economic Sciences The Nobel Memorial Prize in Economic Sciences, officially the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel ( sv, Sveriges riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), is an economics award administered ...

for his “development of the contractual and constitutional bases for the theory of economic and political decision-making.” Buchanan rejects “any organic conception of the state as superior in wisdom, to the individuals who are its members.” This philosophical position is, in fact, the very subject matter of constitutional economics. Buchanan believes that a constitution, intended for use by at least several generations of citizens, must be able to adjust itself for pragmatic economic decisions and to balance interests of the

state State may refer to: Arts, entertainment, and media Literature * ''State Magazine'', a monthly magazine published by the U.S. Department of State * ''The State'' (newspaper), a daily newspaper in Columbia, South Carolina, United States * ''Our S ...

and society against those of individuals and their constitutional rights to personal freedom and private happiness. The Russian school of constitutional economics was created in the early 21st century with the idea that CE allows for a combined economic and constitutional analysis in the legislative, first of all, budget process, thus helping to overcome arbitrariness in the economic and financial decision-making and to open entrance to civil society into budget process. This model of CE is based on the understanding that it is necessary to narrow the gap between practical enforcement of the economic, social and political rights granted by the constitution and the annual (or mid-term) economic policy, budget legislation and administrative policies conducted by the government. In 2006, the

Russian Academy of Sciences The Russian Academy of Sciences (RAS; russian: Росси́йская акаде́мия нау́к (РАН) ''Rossíyskaya akadémiya naúk'') consists of the national academy of Russia; a network of scientific research institutes from across t ...

has officially recognized constitutional economics as a separate academic sub-discipline. Constitutional economics studies such issues as the proper national

wealth Wealth is the abundance of Value (economics), valuable financial assets or property, physical possessions which can be converted into a form that can be used for financial transaction, transactions. This includes the core meaning as held in the ...

distribution including the government spending on the judiciary, which in many transitional and developing countries is completely controlled by the executive. The latter undermines the principle of powers' “

checks and balances Separation of powers refers to the division of a state's government into branches, each with separate, independent powers and responsibilities, so that the powers of one branch are not in conflict with those of the other branches. The typic ...

”, as it creates a critical financial dependence of the judiciary. It is important to distinguish between the two methods of

corruption Corruption is a form of dishonesty or a criminal offense which is undertaken by a person or an organization which is entrusted in a position of authority, in order to acquire illicit benefits or abuse power for one's personal gain. Corruption m ...

of the

judiciary The judiciary (also known as the judicial system, judicature, judicial branch, judiciative branch, and court or judiciary system) is the system of courts that adjudicates legal disputes/disagreements and interprets, defends, and applies the law ...

: the state (through budget planning and various privileges – being the most dangerous), and the private. The state corruption of the judiciary makes it almost impossible for any business to optimally facilitate the growth and development of national

market economy A market economy is an economic system in which the decisions regarding investment, production and distribution to the consumers are guided by the price signals created by the forces of supply and demand, where all suppliers and consumers ...

.Peter Barenboim, Defining the rules, The European Lawyer, Issue 90, October 2009

Budget, Civil society and Constitutional economics

See also