Administrative Reform of Greek State Budgeting

Abstract

This study focuses on the implementation of Performance Budgeting in Greece. A paradigm shift from Incremental to Performance Budgeting has emerged because of recommendations of the institutions (IMF, OECD, and EU), the economic crisis and a change on political priorities. The classic form of state budget used in Greece is directly related to inputs and it is not originally linked to either the planning or the management of public policies. Consequently, no guidelines emerge during its implementation and it cannot be used as a policy or decision-making tool since it does not leave enough space for flexibility or major changes in the allocation of resources. Greece adjusts its budgetary system in order to adapt to international and European environment by incorporating isomorphic changes. The analysis of the three forms of isomorphic trends a coercive (response to external pressure), b) normative (professionals push to conform to a set of norms and rules in order to get legitimate), c) mimetic (imitating others) is an attempt to explain how the last ones affected the Greek reform agenda in order Greece to gain legitimacy and power. The research focuses only on one country and does not claim to provide an overall generalization of results, improving the current situation awareness of one country and does not provide an overall generalization. The research value of the paper is to highlight the role of budgeting in reinventing the public sector, analyse the applied theories in order to understand state budgeting dysfunctions and how can these techniques be evolved.

JEL classifications: H61, H83, P41

Keywords: Performance budgeting, isomorphism, institutionalization