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I have heard this many times about many places. It seems so perverse to a layman, so why is it apparently so widespread? Are there contexts in which it's the b
by anonymous_sorry 3y ago
I have heard this many times about many places.
It seems so perverse to a layman, so why is it apparently so widespread? Are there contexts in which it's the best system (ie. better than any reasonable alternative)?
- Jensson 3y agoYou are a manager over two departments. A has 1 million left, B has 1 million deficit. What do you do? Easy answer: Move 1 million of A's budget to B! It isn't more complicated than that, it is very hard to motivate not reducing A's budget in that case. It does create perverse incentives, but at the same time what are you supposed to do as a manager in that situation?
- anonymous_sorry 3y agoWell, to meet an in-year shortfall it makes sense to move the money around. But the implication seems to be that underspending departments are "punished" with a smaller budget in subsequent years. I would naively hope a good manager would ask for a justification of the spending of both departments, and allocate the forward budget according to reasonably-evidenced projections of value for money based on the organisation's priorities or goals. Perhaps the answer is that that is just too hard, or even more prone to being gamed.