Principals and agents: an explanatory model for public budgeting
Journal of Public Budgeting, Accounting & Financial Management
ISSN: 1096-3367
Article publication date: 1 March 1996
Abstract
Principal agent theory has its roots in the economic theory of the firm, decision theory, sociology, organizational theory, and more recently political science. However, there are only limited applications of the theory in the arena of public budgeting. This paper considers principal agent theory as an alternative method for explaining budgetary outcomes through an examination of interactive relationships not adequately captured by traditional hierarchical-based models of public budgeting. Because implicit and explicit contractual relationships pervade the entire budget making process, principal agent theory can make a major contribution toward developing more inclusive and accurate models of most stages of public budgeting.
Citation
Smith, R.W. and Bertozzi, M. (1996), "Principals and agents: an explanatory model for public budgeting", Journal of Public Budgeting, Accounting & Financial Management, Vol. 10 No. 3, pp. 325-353. https://doi.org/10.1108/JPBAFM-10-03-1998-B001
Publisher
:Emerald Publishing Limited
Copyright © 1998 by PrAcademics Press