ABSTRACT
This chapter examines an ambitious effort to apply economic analysis to the decision-making of the federal government. Before evaluating the governmental innovation, it may be useful to see how earlier developments in the economic analysis of governmental expenditure decisions relate to it. The Planning-Programming-Budgeting System (PPBS), which each major federal government department and agency is now setting up in response to the directive from President Johnson, is patterned on the approach which has been instituted at the Pentagon. The main product of Planning-Programming-Budgeting System is designed to be a comprehensive multi-year Program and Financial Plan for each government agency, which will be updated periodically and systematically. It is doubtful whether, in the initial stages, the PPBS is able to do much toward rationalizing the whole gamut of federal transportation programs. Presumably, the current emphasis is on improving the "building blocks", the difficult task of evaluating the individual components.
