Ordering Chaos: The Performance Consequences of Budgetary Changes

29 Pages Posted: 26 Sep 2018

See all articles by Carla Flink

Carla Flink

American University - School of Public Affairs

Date Written: September 26, 2018

Abstract

Literature on punctuated equilibrium theory has aimed to explain the causes of policy punctuations. What remains unknown are the consequences of those punctuations (and other size changes) for organizations. Specifically, this study analyzes how budgetary changes affect organizational performance. While the connection between financial resources and organization outcomes have been examined before, the analyses here expand upon previous work by considering the full spectrum of budgetary changes from negative punctuations to positive punctuations. This topic is important given today’s fiscal uncertainty. For managers and bureaucrats, they are expected to stabilize organization outputs no matter what policy inputs are established in the organization. At times, inputs can be erratic and unstable–successful organizations can find a way to maintain performance despite these obstacles. In the context of school districts, this study examines the performance consequences (measured by annual changes in the statewide standardized test pass rate) of different size alterations in instructional expenditures. Results indicate that, generally, organizations are able to dampen the impact of financial changes in the translation to outputs.

Keywords: Punctuated Equilibrium Theory, Public Policy Process, Public Administration, Public Budgeting, Organization Performance

Suggested Citation

Flink, Carla, Ordering Chaos: The Performance Consequences of Budgetary Changes (September 26, 2018). American University School of Public Affairs Research Paper No. 3255595, Available at SSRN: https://ssrn.com/abstract=3255595 or http://dx.doi.org/10.2139/ssrn.3255595

Carla Flink (Contact Author)

American University - School of Public Affairs ( email )

Washington, DC 20016
United States

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