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This paper tests public budgeting as a long-run and short-run process; political decision makers strive to head toward budgetary balance over the long run but are constrained in the short run and follow incremental decision-making. First, the budget equilibrium theory is stated and is used to explain the relationship between revenues and expenditures. Second, the interaction between expenditures and revenues is tested with a vector error correction model for Canada, UK and the US, using annual time series data between 1948 and 2000. The results show that, in the long-run, revenues are the driving force behind the budget in Canada; in the UK expenditures force the budget toward balance. In the short-run, incrementalism occurs in both of these countries. The most interesting finding is for the United States where on-budget revenues and expenditures both push the budget toward balance over the longrun but there is no incrementalism in the process in the short-run. This, of course, is contrary to much of the existing literature.

In 2001, Ethiopia established a centralized anti-corruption agency (ACA), the Federal Ethics and Anti-Corruption Commission (FEACC) (see, Proclamation Nos. 433/2005 and 882/2015), purportedly to be used for curbing the rampant corruption. By the government's repeated admissions, corruption continues to engulf the country, indicating the failure of the FEACC to curb corruption. Various researchers attribute the FEACC's failures to curb corruption to a host of reasons that many anticorruption initiatives have fallen apart. This paper follows a different route to show why the FEACC was doomed to fail from the outset. First, we show that the FEACC is indeed a generic anticorruption agency (ACA) largely based on the principal-agent model of corruption. We deploy some testable hypotheses to explore the scenarios under which an anti-corruption agency would be effective. We show that the war against corruption in Ethiopia collapsed mainly because of mischaracterization of the nature of corruption in the country and how the FEACC was established: a conventional anti-corruption agency for a non-conventional problem of corruption. Drawing from the corruption literature of post-communist countries, the paper shows that corrupt Ethiopian practices can easily be subsumed under an extreme version of the highest form of corruption known as state capture. The paper then moves onto unpacking the systemic and predatory nature of the Ethiopian corruption conundrum and how the FEACC approached in tackling it. Doing so allows us to illustrate the endogenous nature of the country's corruption patterns and why a traditional ACA is incapable of tackling a state-driven patronage. It also lays out the flawed structures and practices of the FEACC showing why, under a state enginnered corruption conundrum, the FEACC was doomed to fail from the start. The paper concludes by illustrating the detrimental effects of using the agency as a political weapon to neutralize the ruling party's political opponents as well as the failure of the war against corruption. It calls for a different approach in combating the Ethiopian systemic corruption, a governance regime change being one of them.

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