@article{358d96f077e9483796898788eb1c08e4,
title = "Are governmental expenditures also sticky? Evidence from the operating expenditures of public schools",
abstract = "Existing research on cost stickiness focuses primarily on for-profit companies. This study investigates cost behaviour in the public sector, a new setting that deserves more research attention. Using unique data from public schools in Taiwan, we find that operating expenditures of public schools are sticky. Moreover, the stickiness is more prominent for schools whose principals facing higher enrolment pressure. These results support the public choice theory, suggesting that bureaucratic power may serve as a key driver leading to a sticky cost behaviour for governmental organizations. The government auditors and congressional representatives monitoring governmental budgets should thus notice that bureaucrats might keep the level of expenditures just for their self-interests when demand declines, a manifestation of distortion in allocation of social resources.",
author = "Wu, {Tsing Zai C.} and Young, {Chaur Shiuh} and Yu, {Chun Chan} and Hsu, {Hsiao Tang}",
note = "Funding Information: We are grateful for the helpful comments from William Baber, Hsi-Hui Chang, Hsing-Chin Hsiao, Ping-Hsun Huang, Ne-Chen Hwang, Sally Widener, and Xiao-Tao (Kelvin) Liu. We also thank the research help from the Accounting Office of the Department of Education, Dr. Meng-He Yu, Dr. Chun-Chieh Huang, and the principals we interviewed. Chun-Chan Yu and Chaur-Shiuh Young gratefully acknowledge the Ministry of Science and Technology, Taiwan, ROC, for support of this work under contract (Project No. MOST 108-2410-H-005-002 and 108-2410-H-006-029). Funding Information: This work was supported by the Ministry of Science and Technology, Taiwan [MOST 108-2410-H-005-002, MOST 108-2410-H-006-029]. We are grateful for the helpful comments from William Baber, Hsi-Hui Chang, Hsing-Chin Hsiao, Ping-Hsun Huang, Ne-Chen Hwang, Sally Widener, and Xiao-Tao (Kelvin) Liu. We also thank the research help from the Accounting Office of the Department of Education,?Dr. Meng-He Yu,?Dr. Chun-Chieh Huang,?and the principals we interviewed. Chun-Chan Yu and Chaur-Shiuh Young gratefully acknowledge the Ministry of Science and Technology, Taiwan, ROC, for support of this work under contract (Project No. MOST 108-2410-H-005-002 and 108-2410-H-006-029).",
year = "2020",
month = apr,
day = "2",
doi = "10.1080/00036846.2019.1678731",
language = "English",
volume = "52",
pages = "1763--1776",
journal = "Applied Economics",
issn = "0003-6846",
publisher = "Routledge",
number = "16",
}