Does Participatory Budgeting Alter Public Spending? Evidence From New York City

Abstract

Participatory budgeting is described as a direct-democracy approach to resource allocation decision making. Theories assume it changes how public resources are spent by moving decisions from elected officials to citizens. The literature does not consider how earmarking—in which legislators direct parts of public budgets directly—might affect the impact of such policy devices. New York City’s participatory budgeting process which uses earmarks is analyzed to determine spending changes. Officials involved fund more projects at lower average amounts than those not involved but do not change the areas of funding, all of which is expected in systems of budgetary earmarks controlled by legislators.

Participatory Transparency in Kenya: Toward an Engaged Budgeting Model of Local Governance

“…Yet, multiple studies have suggested that citizen participation in budgetary decision‐making is typically minimalist and yields few, if any, directly observable results (Ebdon and Franklin 2006). Most recently, for example, Calabrese, Williams, and Gupta (2020) find no evidence of impact in New York City. Ebdon and Franklin (2006) argue the need for “more rigorous theorizing using empirical evidence to model causal relationships” for participatory budgeting.…”

The impact of pork‐barrel capital funding in schools: Evidence from participatory budgeting in NYC

“…First, as is generally true with RD designs, it is possible that the average treatment on the treated effect differs from the local average effect near the discontinuity (Angrist & Pischke, 2008). Second, one might believe that projects funded through the PB process differ meaningfully from projects funded by traditional CM capital discretionary funds (Calabrese et al, 2020; Hagelskamp et al, 2020). Indeed, we find differences in the composition of school projects, though every PB project has a similar‐looking counterpart among those funded using traditional CM discretionary processes (see Appendix Table A1).…”

“…Controversy over the value of the CM discretionary funding process remains post‐PB, with advocates suggesting funds support critical populations such as youth, immigrants, and seniors, and critics arguing funded projects are not as crucial as maintaining basic services (Campanile, 2020). Empirical evidence on the effects of PB is scarce (Calabrese et al, 2020; Hagelskamp et al, 2020; Shybalkina & Bifulco, 2019).…”

Local participatory budgeting in a multilevel government – an institutional analysis of Ecuadorian municipal expenditure policies

“…For New York, Russon-Gilman (Russon Gilman 2016) sees both a potential of PB to empower political participation through inclusive governance and a sufficient ability for PB processes to develop rational proposals within city budgets. Calabrese et al (2020) show how earmarking of revenues determines officials' choice of funding areas within New York's PB. Similarly, PB has been discussed as an inclusive learning arena that builds political capital in terms of multiple sources for democracy education (Kasdan and Markman 2017;Goldfrank and Schugurensky 2019).…”