Association for Public Policy Analysis & Management

The advent of decrementalism by Behn (1985) fundamentally altered notions of incremental budgeting theory. Scholars shifted attention away from assumptions of stable growth and sought new theories and models of cutback management (e.g., Levine, 1978; 1979) and cutback budgeting which considered the political dimensions of budgets. Such theories cast considerable emphasis on how governments respond to fiscal stress, given constraints on intergovernmental revenues and pressures to cut expenditures. However, such budget constraints may translate into policies which prove adverse to public service delivery due to short term cuts, with the potential for long-term effects as explored by Berne and Stiefel (1993). In the state and local government context, Pennsylvania education finance in the Great Recession serves as a unique case to study if budget decrements were motivated by evidence-based cutback management, political motivations, or via a random effects model in which policymakers sought short-term cuts to education without considering implications for the longer term.  

To  advance policy process literature on decremental budgeting politics with the question of how states use evidence-based policy to respond to fiscal stress, a model of determinant factors of the 14,000 teachers who lost their jobs under a reduction in force (RIF) through the Great Recession is tested. A population enumeration of all Pennsylvania school districts (N=499) with over 25 demand, cost, socio-economic, fiscal capacity, institutional, and political factors will provide evidence of which factors motivated the decision to cut teachers. This will be conducted with a generalized negative binomial count model discussed in Hilbe (2014), to both satisfy assumptions of the distribution of teacher cuts but also allow for a quantile variant to assess cutback heterogeneity. This model serves as the first to look at teacher RIFs in response to fiscal stress from the count of teacher layoffs across a panel of time. It will determine whether cuts through the Great Recession can be attributed exclusively to rational systems budgeting due to declining revenues and expenditure cuts or to an open systems perspective which incorporates institutional and political factors. It is also the first paper to tie the cutback budgeting literature and decremental politics literature to understanding whether policymakers employed evidence-based management in seeking cuts which reduced long-term strain on the education finance system.