Public management in times of austerity: Literature review

This paper represents the first draft of a second chapter for a forthcoming volume on Public Management in Times of Austerity. The book focuses on the management of two austerity policies, budgetary reform and expenditure... [ view full abstract ]

This paper represents the first draft of a second chapter for a forthcoming volume on Public Management in Times of Austerity. The book focuses on the management of two austerity policies, budgetary reform and expenditure cutbacks, in five European countries. The paper presents a review of literatures on budgetary- and financial management reform and on cutback management. On this basis, a set of propositions is formulated concerning the character (the hows) of budgetary reforms and cutback management in the present age of austerity and concerning the significance of varying economic and institutional factors (the whys) to the management of budgetary reform and cutbacks. It is, for example, argued that fiscal discipline may in the short term crowd out those performance-oriented reforms that are meant to improve operational efficiency whereas in the longer term higher levels of fiscal pressure may lead to budgetary reforms that aim at improving allocative effectiveness across organizational borders in government. In this respect, the present conditions of austerity are expected to reinforce the ongoing transformation of reform trajectories from the principles of the NPM towards those of ‘post-NPM’ reform.