¹ For a concise explication of the input—output perspective see Hofferbert, Richard I., The Study of Public Policy (Indianapolis: Bobbs Merrill, 1974)Google Scholar. Contributors are legion. Some of the more noteworthy are Dye, Thomas R., Politics, Economics and the Public (Chicago: Rand McNally, 1966)Google Scholar; Understanding Public Policy (Englewood Cliffs, N.J.: Prentice-Hall, 1972)Google Scholar, and Politics in States and Communities (Englewood Cliffs, N.J.: Prentice-Hall, 1969)Google Scholar; Hofferbert, Richard I. and Sharkansky, Ira, ‘Dimensions of State Politics, Economics and Public Policy’, American Political Science Review, LXIII (1969), 867–80Google Scholar; Sharkansky, Ira, ‘Economic and Political Correlates of State Government Expenditures’, Midwest Journal of Political Science, XI (1967), 173–92CrossRefGoogle Scholar, Spending in the American States (Chicago: Rand McNally, 1968)Google Scholar, and The Politics of Taxing and Spending (Indianapolis: Bobbs-Merrill, 1969)Google Scholar; Cnudde, Charles F. and McCrone, Donald J., ‘Party Competition and Welfare Policies in the American States’, American Political Science Review, LXIII (1969), 858–86CrossRefGoogle Scholar. Studies undertaken by policy process theorists include Wildavsky, Aaron, The Politics of the Budgetary Process (Boston: Little, Brown, 1964)Google Scholar, and Budgeting (Boston: Little Brown, 1976)Google Scholar; Crecine, John P., Governmental Problem Solving: A Computer Simulation of Municipal Budgeting (Chicago: Rand McNally, 1969)Google Scholar. More general formulations of this theoretical school can be found in Truman, David B., The Governmental Process (New York: Alfred A. Knopf, 1951)Google Scholar; Dahl, Robert A. and Lindblom, Charles E., Politics, Economics and Welfare (New York: Harper and Row, 1953)Google Scholar; Dahl, Robert A., Who Governs? (New Haven: Yale University Press, 1961).Google Scholar

² This focus became particularly dominant following Dawson, Richard E. and Robinson, James A., ‘Inter-Party Competition, Economic Variables, and Welfare Policies in the American States’, Journal of Politics, XXV (1963), 265–89.CrossRefGoogle Scholar

³ Hofferbert, , Study of Public Policy, pp. 142–3Google Scholar and Dye, , Politics, Economics and the Public, pp. 1–5.Google Scholar

⁴ For interesting criticisms of input-output studies see Stonecash, Jeff, ‘The Significance of Politics and Wealth for Public Policy’ (paper presented at the 1979 Midwest Political Science Association Meeting, Chicago, Illinois, 04 1979)Google Scholar; Peterson, Paul E., City Limits (Chicago: University of Chicago Press, 1981)CrossRefGoogle Scholar, Chap, 1., and Coulter, Philip B., ‘Comparative Community Politics and Public Policy’, Polity, III (1970), 22–43.CrossRefGoogle Scholar

⁵ The incremental model with respect to budgeting first achieved prominence in Wildavsky, , Politics of the Budgetary ProcessGoogle Scholar. Studies of local budgeting that follow the model include Crecine, , Governmental Problem SolvingGoogle Scholar; Wildavsky, , BudgetingGoogle Scholar; Meltsner, Arnold, The Politics of City Revenue (Berkeley: University of California Press, 1971)Google Scholar, and Anton, Thomas, Budgeting in Three Illinois Cities (Urbana, Illinois: Institute of Government and Public Affairs, 1964).Google Scholar

⁶ This point is made most explicitly by Lowi, Theodore J., ‘American Business, Public Policy, Case Studies and Political Theory’, World Politics, 16 (1964), 676–715CrossRefGoogle Scholar. However, the prime importance of policy as a determinative force in shaping the policy process is widely accepted by other process theorists. See Smith, T. Alexander, ‘Toward A Comparative Theory of the Policy Process’, Comparative Politics, 1 (1968–1969), 498–515CrossRefGoogle Scholar; Wildavsky, Aaron, The Politics of the Budgetary ProcessGoogle Scholar; and Froman, Lewis A., ‘The Categorization of Policy Contents’, in Ranney, Austin, ed., Political Science and Public Policy (Chicago: Markham, 1968), Chap. 3.Google Scholar

⁷ Even process theorists who recognize that non-policy variables also have some influence on budget decision making do not dispute this fundamental rationale for concluding that urban budgeting is a politics of incremental adjustment. For example, Wildavsky, in formulating an ambitious comparative theory of budgeting that applies to nearly all governmental contexts, including underdeveloped countries, acknowledges that wealth and revenue predictability distinguish various budgetary arenas. Nevertheless, Wildavsky remains consistent to his belief that incrementalism is an inherent characteristic of virtually all governmental budgetary systems. See Budgeting, Chaps, 1 and 7.

⁸ Some other criticism of this model may be found in LeLoup, Lance T., ‘The Myth of Incrementalism: Analytical Choices in Budgetary Theory’, Polity, X (1978), 491–504.Google Scholar

⁹ David, Stephen and Kantor, Paul, The Dependent City (forthcoming)Google Scholar; Peterson, , City LimitsGoogle Scholar; Waltz, Kenneth N., Theory of International Politics (Reading, Mass.; Addison-Wesley, 1979).Google Scholar

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¹¹ Clearly, the international context imposes on nation states important economic and political constraints, which are likely to be reflected in domestic policy. Nation states struggling for power and wealth in the international order have been considered to behave along the lines we are suggesting in the case of cities. See, Allison, Graham T., Essence of Decision (Boston: Little Brown, 1971)Google Scholar. As we argue below, however, our framework of analysis does not assume the unified pursuit of ‘rational’ interests, a point suggested by Allison.

¹² Peterson, , City Limits, p. 151.Google Scholar

¹³ Peterson, , City Limits, pp. 150–1.Google Scholar

¹⁴ Watkins, Alfred J., The Practice of Urban Economics (Beverly Hills, Calif.: Sage, 1980).Google Scholar

¹⁵ ‘Exit’ and ‘relocation’ as social processes are discussed in Hirschman, Albert O., Exit, Voice, and Loyalty (Cambridge: Harvard University Press, 1971)Google Scholar and Cox, Kevin R., Conflict, Power and Politics in the City (New York: McGraw Hill, 1973), respectively.Google Scholar

¹⁶ Stone, Clarence N., ‘Systematic Power in Community Decision Making: A Restatement of Stratification Theory’, American Political Science Review, LXXIV (1980), 978–90.CrossRefGoogle Scholar

¹⁷ We are utilizing fairly crude indicators of the market position and political support of cities in our table in absence of widely accepted theories which explain these forces. For example, in urban economics there are micro-level locational theories, which focus on the actions of individual units (firms, industries) as they adjust to market changes. There are also various macro-level approaches seeking to explain urban economic development — e.g., stages of urban development, the relationship of export to service sectors, etc. (Watkins, , Practice of Urban EconomicsGoogle Scholar and Thompson, Wilber R., A Preface to Urban Economics (Baltimore: Johns Hopkins Press, 1965), Chap. 1Google Scholar. But all this is far from a theory of urban economic development. Consequently, we are employing urban growth/decline as an indicator of city market position since it appears so strongly related to urban prosperity in the end.

¹⁸ The concept of policy arenas, in general, and budget arenas in particular, can be found in at least two streams of the literature. Works which seek to generalize on the basis of governmental policy functions are Kantor, Paul, ‘Elites, Pluralists and Policy Arenas in London: Toward A Comparative Theory of City Policy Formation’, British Journal of Political Science, VI (1976), 311–34CrossRefGoogle Scholar; Lowi, , ‘American Business’Google Scholar; and Peterson, , City LimitsGoogle Scholar. Literature which distinguishes among different types of budgetary decisional processes include Wildavsky, , BudgetingGoogle Scholar and his related works.

¹⁹ This might also include other categories of conflicts over social status, such as race. See Lowi, , ‘American Business’.Google Scholar

²⁰ For a description of this process in the case of New York City see Lowi, Theodore J., At the Pleasure of the Mayor (Glencoe, Ill.: The Free Press, 1964), especially Chap. 4.Google Scholar

²¹ Shefter, Martin, ‘The Emergence of the Machine: An Alternative View’Google Scholar, and Katznelson, Ira, ‘The Crisis of the Capitalist City: Urban Politics and Social Control’, in Hawley, Willis D. et al. , Theoretical Perspectives on Urban Politics (Englewood Cliffs, N.J.: Prentice-Hall, 1976), pp. 14–44 and 214–29.Google Scholar

²² Norman, and Fainstein, Susan, Urban Political Movements (Englewood Cliffs, N.J.: Prentice Hall, 1974), pp. 16–18.Google Scholar

²³ Clark, P. B. and Wilson, J. Q., ‘Incentive Systems: A Theory of Organizations’, Administrative Science Quarterly, VI (1961), 129–66, p. 141.CrossRefGoogle Scholar

²⁴ Exit, Voice, and Loyalty. We are also indebted to Paul E. Peterson for calling our attention to some of the relationships we discussed.

²⁵ Mills, C. Wright, The Power Elite (New York: Oxford University Press, 1956).Google Scholar

²⁶ Mills, , Power Elite, p. 296.Google Scholar

²⁷ For a discussion of some of these techniques see Lipsky, Michael, Protest in City Politics (Chicago: Rand McNally, 1970)Google Scholar and Katznelson, Ira, Black Men, White Cities (New York: Oxford University Press, 1973).Google Scholar

²⁸ For a succinct analysis of the structural factors which have promoted this development, see Report of the Twentieth Century Fund Task Force on the future of New York City, New York: World City, background and paper by Sinnreich, Masha (Cambridge, Mass.: Oelgeshlager, Gunn, and Hain, 1980), pp. 48–53Google Scholar. As regards national urban trends see Advisory Commission on Intergovernmental Relations, Trends in Metropolitan Government (Washington, D.C.: US Government Printing Office, 1977)Google Scholar; Perry, David C. and Watkins, Alfred J., eds, The Rise of the Sunbelt Cities (Beverly Hills, California: Sage, 1978)Google Scholar; and Gorham, William and Glazer, Nathan, eds, The Urban Predicament (Washington, D.C.: The Urban Institute, 1976).Google Scholar

²⁹ See Sayre, W. and Kaufman, H., Governing New York City: Politics in the Metropolis (New York: Russell Sage, 1960)Google Scholar; Banfield, E., Political Influence (Glencoe, Ill.: The Free Press, 1969)Google Scholar; and Dahl, , Who Governs?Google Scholar

³⁰ The literature describing these events is voluminous. Among the most relevant are Burnham, Walter Dean, Critical Elections and the Mainsprings of American Politics (New York: W. W. Norton, 1970)Google Scholar; Piven, Francis F. and Cloward, Richard A., Regulating the Poor (New York: Vintage, 1971)Google Scholar; and Bellush, Jewel and David, Stephen M., Race and Politics in New York City (New York: Praeger, 1971).Google Scholar

³¹ Tobier, E., ‘Economic Development Strategy for the City’, in Smith, L. C. and Walsh, A. M. H., eds, Agenda for the City: Issues Confronting New York (Beverley Hills: Sage, 1970), pp. 27–84.Google Scholar

³² This description of New York City's political system during this period relies heavily on the classic study done by Sayre, and Kaufman, , Governing New York City: Politics in the Metropolis (New York: Russell Sage, 1960), especially Chap. XIII.Google Scholar

³³ The best known management study of the city government during this period concluded that increases in the city budget were due to inflation rather than ‘an excessively high standard of municipal living’. (Report of the Mayor's Committee on Management Survey, Modern Management for the City of New York (New York: The Committee, 1953), Vol. I., p. 176.)Google Scholar

³⁴ Schick, A., Central Budget Issues Under the New York City Charter, report prepared for the State Charter Revision Commission for New York City (New York: State Charter Revision Commission, 1974), p. 67.Google Scholar

³⁵ David, and Kantor, , ‘Political Theory and Transformations’, p. 198.Google Scholar

³⁶ David, and Kantor, , ‘Political Theory and Transformations’, pp. 198–200.Google Scholar

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³⁸ The impact of these groups is discussed in detail in Bellush, and David, , Race and Politics in New York CityGoogle Scholar, Piven, and Cloward, , Regulating the PoorGoogle Scholar; Greenstone, David and Peterson, Paul E., Race and Authority in Urban Politics (New York: Russell Sage, 1973)Google Scholar and Piven, Francis, ‘The Urban Crisis: Who Got What and Why’, in Wolff, Robert P., ed., 1984 Revisited (New York, Random House, 1972), pp. 165–201.Google Scholar

³⁹ Schick, , Central Budget Issues, pp. 7–8.Google Scholar

⁴⁰ Haider, D., ‘Sayre and Kaufman Revisited: New York City Government Since 1965’, Urban Affairs Quarterly, XV (1979), pp. 138–9.Google Scholar

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⁴⁴ The primary impact of the increased state and federal aid was programmatic; the bulk of these monies went to agencies performing social welfare functions. See Haider, , ‘Sayre and Kaufman Revisited’, p. 131.Google Scholar

⁴⁵ Shefter, M., ‘New York City's Fiscal Crisis: The Politics of Inflation and Retrenchment’, Public Interest, XLVIII (1977), 98–127Google Scholar, reprinted in Levine, C., Managing Fiscal Stress: The Crisis in the Public Sector (Chatham, N.J.: Chatham House Publishers, 1980), p. 78.Google Scholar

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⁴⁷ Haider, , ‘Sayre and Kaufman Revisited’, pp. 138–9.Google Scholar

⁴⁸ Bernstein, , ‘Financing the City Government’, pp. 83–6Google Scholar. In the fiscal year 1958–59, the city received 47 per cent of its revenue from the real estate tax, 30 per cent from other local taxes, and 23 per cent from intergovernmental aid. A decade later, 29 per cent of the city's revenue came from the real estate tax, the same percentage from other local taxes and charges, and 42 per cent from inter-governmental aid.

⁴⁹ Congressional Budget Office, ‘The Causes of New York City's Fiscal Crisis’, Political Science Quarterly, XC (1975–1976), p. 668.Google Scholar

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⁵³ Of the nine original members of MAC five were chosen by the governor and four by the mayor; all but one of these appointees had banking or brokerage connections. Haider reached a somewhat similar conclusion in his study of New York's budgetary arena during this period. Haider concluded that the ‘dominant actors’ came from the business and financial community, as well as the federal government and the municipal unions. See Haider, , ‘Sayer and Kaufman Revisited’, p. 149Google Scholar. Cf. Shefter, , ‘New York City's Fiscal Crisis’, pp. 81–4.Google Scholar

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⁵⁵ Brecher, and Horton, , Setting Municipal Priorities, p. 2.Google Scholar