Strategic budgeting in public schools: An experimental comparison of budget formats

Advances in Management Accounting

ISBN: 978-0-85724-817-6, eISBN: 978-0-85724-818-3

ISSN: 1474-7871

Publication date: 17 February 2011


Spending constraints in state budgets have resulted in a need to evaluate the effects of alternative budgeting techniques. We study public school administrations, where improvements in budgetary processes could help align system goals with reduced levels of funding. A budgeting technique, called strategic budgeting (SB), emphasizing information symmetry and mutual monitoring, is investigated in a nonprofit setting by comparing it to a traditional budgeting (TB) method. The experiment finds that the effect of reduced spending previously discovered in a corporate setting are also evident in a not-for-profit setting. Results indicated an overall cost savings with SB of almost 25 percent. Public school administrators made spending decisions in a hypothetical three-year task and provided comments to justify their decisions. These comments along with anecdotal evidence from prior field research indicate that collaborative characteristics in a budget format may reduce unnecessary spending.



Taylor, A., Kowalczyk, T. and Klein, S. (2011), "Strategic budgeting in public schools: An experimental comparison of budget formats", Epstein, M.J. and Lee, J.Y. (Ed.) Advances in Management Accounting (Advances in Management Accounting, Vol. 19), Emerald Group Publishing Limited, Bingley, pp. 133-160.

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