The Timing of Managerial Responses to Fiscal Stress

Abstract

Abstract Using 34 years of data from Florida counties, we examine the effect of multiple fiscal stressors on expenditures over time to test theoretical propositions in Charles Levine's seminal study on cutback management. We demonstrate support for Levine's stages model and his claims on linkages between the causes of fiscal stress and managerial responses. Specifically, unemployment levels produce differential effects by service area (e.g., human services bear the most significant share of the reductions), especially in relation to the persistence of the stressor. We cannot support the stages model with other stressor measures. We expand the literature to include county governments, enhancing the contemporary literature on local government fiscal stress.