ABSTRACT
This chapter defines budgeting and describes the different purposes of public budgeting. It explains the evolution of the budget process and discusses four major types of budget reforms: line-item budgeting, performance budgeting, the planning-programming budgeting system, and zero-based budgeting (ZBB). Models of budgetary decision-making help to understand the complexity of the budgetary process. The chapter provides an overview of major revenue systems, followed by a discussion of the rational and incremental models of budgeting. It also discusses budgets as action plans typically evolve through four stages that constitute a cycle. Some federal government administrators observe that ZBB focused more attention on agency objectives, generated alternative spending and service levels, and encouraged the use of more quantitative data in budget requests; but overall, the federal government's experience with ZBB was largely negative.
