Time: 12:00PM - 1:00PM
Location: Eldersveld Room (5670 Haven Hall)
The appropriations cycle makes agencies uncertain about the future of funding. To examine the strategies agencies use to respond to uncertain future appropriations, I develop a dynamic, stochastic control model of policy choice by agencies. The model is used to directly derive a method of recovering the budget-output function of an agency. I collect and analyze data on the activities of a number of federal agencies, both independent and executive-organized. I find that agencies make explicit tradeoffs between having budget and their policy choices. This finding suggests that agencies are not single-minded budget maximizers, nor are they only motivated by policy.