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This title is part of UC Press's Voices Revived program, which commemorates University of California Press's mission to seek out and cultivate the brightest minds and give them voice, reach, and impact. Drawing on a backlist dating to 1893, Voices Revived makes high-quality, peer-reviewed scholarship accessible once again using print-on-demand technology. This title was originally published in 1973.

Recent quantitative studies vastly understate the political conflicts and policy choices that are embedded in the budgetary process. The reason for this lies in the way these quantitative studies have organized budgetary data. Thus far the units of analysis have been federal agencies, the administrative categories of government. The "striking regularities" that have been reported reflect—quite accurately—the great stability of the administrative structure of government. However, these categories do not describe the intense competition between programs and policies that takes place within the framework. We argue, further, that the entire metaphor of an inert bureaucratic machine doing this year essentially what it did last year is erroneous. Rather, priority setting in the federal bureaucracy more resembles the market situation of nineteenth century capitalism where aggressive "policy entrepreneurs," unequal in talent and resources, struggle to build and sustain support for their programs. The competition between policies is both reflected in and promoted by the budgetary process. By shifting the units of analysis to programs and transforming these data so that programs of different size are commensurate, we develop an index that reflects the relative growth and decay of programs as they compete for budgetary resources.

There are striking regularities in the budgetary process. The evidence from over half of the non-defense agencies indicates that the behavior of the budgetary process of the United States government results in aggregate decisions similar to those produced by a set of simple decision rules that are linear and temporally stable. For the agencies considered, certain equations are specified and compared with data composed of agency requests (through the Bureau of the Budget) and Congressional appropriations from 1947 through 1963. The comparison indicates that these equations summarize accurately aggregate outcomes of the budgetary process for each agency.In the first section of the paper we present an analytic summary of the federal budgetary process, and we explain why basic features of the process lead us to believe that it can be represented by simple models which are stable over periods of time, linear, and stochastic. In the second section we propose and discuss the alternative specifications for the agency-Budget Bureau and Congressional decision equations. The empirical results are presented in section three. In section four we provide evidence on deviant cases, discuss predictions, and future work to explore some of the problems indicated by this kind of analysis. An appendix contains informal definitions and a discussion of the statistical terminology used in the paper.

This lecture was delivered on the occasion of the John R. Commons Award presentation at the Allied Social Science Association meetings in Chicago, January 2012. Omicron Delta Epsilon presents the award biennially to an outstanding economist in recognition of achievements and service to both the economics profession and Omicron Delta Epsilon. The lecture represents part of the author's continuing exploration of the analysis and development of policies for Social Security and income taxation of earnings.