BUDGET MAXIMIZATION MODEL

Is Kazakhstan's Bureaucracy Budget Maximizing?

Is Kazakhstan's Bureaucracy Budget Maximizing?

Introduction

Budgeting is the process that is significant for every organization. However, it is particularly a major concern for public institutes like government. By definition, budget is the financial planning developed for the implementation in specified upcoming year, generally a fiscal year (Musell, 2009, pp. 10-15). Few of the major aims of the budget include the forecasting of expenditures and revenues. Moreover, this plan includes the development of a model that will assist the organization or institute for efficient financial performance. Furthermore, a budget is a tool that provides the governmental institutes an opportunity to compare the actual plans of financial resources and financial forecasting. Budget is a concept as well as an idea that has undertaken great changes over the years (Musell, 2009, 10-11). Several studies have been carried out with the objectives to come up with improved and new approaches of budgeting for public institutes.

One approach and theory in budgeting of public institute, which has considerable recognition as well, is the budget maximization model. The budget maximization model is possibly one of the most effectual theories in the field of public finance. In the tear 1971, William Niskanen introduced this model. This model is based on the arguments that rational bureaucrats are required to increase their budget allocation all the time with the objective to increase their authority and power. Thus, this tendency of bureaucrats makes significant contributions to the growth and expansion of the State or government. However, it also leads to the reduction of efficiency of social sectors. This has resulted in the rising of one more model called bureaucratic shaping model, so as to counter the impact of budget maximization model.

In this research paper, we will discuss the critical analysis of the efficiency of the Budget maximization hypothesis of Niskanen with the use of case study of Bureaucratic budget maximization of Kazakhstan (Niskanen & Moore, 1994, pp. N.d.). This paper seeks to do budgetary comparison of key agencies of Kazakhstan.

Discussion

Case Study of Kazakhstan's Bureaucratic Budget

The republic of Kazakhstan is a Central Asian country. It is largest landlocked state of the world. In terms of land mass, Kazakhstan is the 9th largest nation. The neighbouring countries of Kazakhstan are china, Uzbekistan, Turkmenistan, Kyrgyzstan and Russia. According to the population data for 2011, the population of Kazakhstan is approximately 16.6 million. In olden times, Kazakhstan was the last country that gained independence in 1991 from United Soviet Union Socialist Republic. Nursultan Nazarbayev was the first president of the country. Furthermore, from the economic viewpoint, Kazakhstan has obtained the tile of being the strongest band largest economy of the Central Asia.

Kazakhstan has considerable amount of metals, minerals and oil reserves (Olcott, 2010, pp. 1-2). The sector of agriculture has revealed enormous potential in animal farming and cropping (Olcott 2010, pp. 1-2). The industrial sector of the state is grounded on the activities that involve extraction and processing of natural resources like minerals and ...