Bureaucratic behavior modeled by reduced-rank regression: The case of expenditures from the Soviet state budget
Date of Original Version
A bureaucratic hierarchy compresses information flowing upward and disaggregates directives passing downward, thus making itself amenable to modeling by reduced-rank regression. Applying this technique to the Soviet government, we find that about eight latent variables are required to characterize the mapping of predetermined variables into a vector of budgetary expenditures. The latent variables can be interpreted as targets for expenditures in high-priority sectors.
Journal of Economic Behavior and Organization
Burkett, John P.. "Bureaucratic behavior modeled by reduced-rank regression: The case of expenditures from the Soviet state budget." Journal of Economic Behavior and Organization 34, 1 (1998): 173-187. doi:10.1016/S0167-2681(97)00041-3.