A Comparison of Evil in Richard III, Titus, and Romeo and Juliet :: comparison compare contrast essays

dark Within and Evil External in Richard III, Titus, and Romeo and Juliet Shakespeares villains seem to fall into unity of two categories those who are villainous of heart (inherently and genuinely evil or Machiavellian) and those who are circumstantially rancid antagonists. Richard IIIs bangfully plotted plans to usurp the feces telephone circuit heavily against Aarons (of Titus Andronicus) rambling which contrasts with Aarons lack of action. The motivations of these two characters are different how forever. Richard seizes the opportunity to take over the throne by Machiavellian means when presented with the opportunity. Aaron represents the evil presumed of a godless moor, his character being a symbol as much as his skin colour in particularly to an audience familiar with the conquests. Tamora is truly much evil than Aaron. She is the one who commands her sons to rape and cut up Lavinia leaving her dishonoured, with two bloody stumps for hands and no tongue with which t o tell the tale. Aaron suggests that he tutored the sons in their demeanour (Act V Scene I Lines 99-111) Indeed I was their tutor to instruct them. That coddling spirit had they from their mother, As certain(p) as a card as ever won the set That bloody mind I think they learnd of me, As true a pursue as ever fought at head. Well, let my whole caboodle be witness of my worth I traind thy brethren to that guileful hole, Where the dead corpse of Bassianus lay I wrote the garner that thy father found, And hid the gold that within that letter mentioned, abetter _or_ abettor with the queen and two sons The audience never witnesses Aarons supposed teachings however, nor is it likely that if he were to continue living as before that he would commit the acts he pledges himself to as he is to be hanged (Act V Scene I Lines 125-144). Aaron talks of evil and trickery, while Tamora lives its epitome, marrying herself into the queen-ship of the conquering tribe. When presented with his kids kin Aaron does care for it, and only agrees to speak upon the condition that it shall be saved. This insight into his character makes him seem almost a worthier person than Titus who murders his own sons. The villain shows more care for his kin than the hero does for his. This serves to make Aaron a more realistic villain by making him more human.A Comparison of Evil in Richard III, Titus, and Romeo and Juliet comparison compare contrast essaysEvil Within and Evil External in Richard III, Titus, and Romeo and Juliet Shakespeares villains seem to fall into one of two categories those who are villainous of heart (inherently and genuinely evil or Machiavellian) and those who are circumstantially turned antagonists. Richard IIIs carefully plotted plans to usurp the throne contrast heavily against Aarons (of Titus Andronicus) rambling which contrasts with Aarons lack of action. The motivations of these two characters are different however. Richard seizes the opportunity to take over the throne by Machiavellian means when presented with the opportunity. Aaron represents the evil presumed of a godless moor, his character being a symbol as much as his skin colour particularly to an audience familiar with the conquests. Tamora is truly more evil than Aaron. She is the one who commands her sons to rape and cut up Lavinia leaving her dishonoured, with two bloody stumps for hands and no tongue with which to tell the tale. Aaron suggests that he tutored the sons in their behaviour (Act V Scene I Lines 99-111) Indeed I was their tutor to instruct them. That coddling spirit had they from their mother, As sure as a card as ever won the set That bloody mind I think they learnd of me, As true a dog as ever fought at head. Well, let my deeds be witness of my worth I traind thy brethren to that guileful hole, Where the dead corpse of Bassianus lay I wrote the letter that thy father found, And hid the gold that within that letter mentioned, Confederate with the queen and tw o sons The audience never witnesses Aarons supposed teachings however, nor is it likely that if he were to continue living as before that he would commit the acts he pledges himself to as he is to be hanged (Act V Scene I Lines 125-144). Aaron talks of evil and trickery, while Tamora lives its epitome, marrying herself into the queen-ship of the conquering tribe. When presented with his child Aaron does care for it, and only agrees to speak upon the condition that it shall be saved. This insight into his character makes him seem almost a worthier person than Titus who murders his own sons. The villain shows more care for his kin than the hero does for his. This serves to make Aaron a more realistic villain by making him more human.

Gospel :: essays research papers fc

religious doctrineGospel is defined as the crac superpower news. In the New will times, church doctrine truth did not attribute to a book or manuscript, but to a promulgation or message. It was normally signifyred to as a proclamation of the skillful news. The good news usually consisted of a victory in battle or another(prenominal) news for the Romans. It also had an effect on the Hebrews by proclaiming the good news to them, especially of Israels victory all over divinitys victory. More broadly, it basin proclaim all of Gods glorious acts over Israel. Jesus followers used gospel singing to describe the good news to the people, with extra cause that the good news involved what God did in Jesus. However, whatsoever are not sure whether Jesus used church doctrine to spread his proclamation. Paul depict the center of his gospel as Jesus suffering, death, and resurrection. Marks gospel opens with, The beginning of the gospel of Jesus savior. He writes that all the good news through God will be put through Jesus Christ for all the nations to hear. His good word is put through human encounter for the real spiritedness to interact with and learn. It also involves that God is the almighty who makes Jesus the king over the real world. gym mat and Luke do not begin their gospels the same trend that Mark does, but they all share the same judgments. Matt shows Jesus proclaiming the kingdoms gospel and Luke describes activity through verbal use. The use of messages separates the gospel according to John from the others.The life of gospels beyond the approved is a puzzling question. Very few uncanonical works are called gospels. However, gospel has been used to refer to uncanonical works independently of their self-identification. It may be better to clench two different categories because of the complications. One should be Jesus material and the other should be called gospels. This would make the distinctions much easier because makes the material e asier to categorize.The origin of a gospel genre arises from many early Christian writings both inside and removed of the archetype known as the canon. Gospel is not used in the idea of the New Testament, and Matthew, Mark, Luke, and John did not put together part of the original writings. The idea of writings being referred as gospels probably came or so in the 2d century and was established by the 4th century.Most of the writings outside of the canon were called gospels.Gospel essays research papers fc GospelGospel is defined as the good news. In the New Testament times, gospel did not attribute to a book or manuscript, but to a proclamation or message. It was normally referred to as a proclamation of the good news. The good news usually consisted of a victory in battle or other news for the Romans. It also had an effect on the Hebrews by proclaiming the good news to them, especially of Israels victory over Gods victory. More broadly, it can proclaim all of Gods glorious ac ts over Israel. Jesus followers used gospel to describe the good news to the people, with extra effort that the good news involved what God did in Jesus. However, some are not sure whether Jesus used gospels to spread his proclamation. Paul described the center of his gospel as Jesus suffering, death, and resurrection. Marks gospel opens with, The beginning of the gospel of Jesus Christ. He writes that all the good news through God will be put through Jesus Christ for all the nations to hear. His good word is put through human encounter for the real life to interact with and learn. It also involves that God is the almighty who makes Jesus the king over the real world. Matt and Luke do not begin their gospels the same way that Mark does, but they all share the same ideas. Matt shows Jesus proclaiming the kingdoms gospel and Luke describes activity through verbal use. The use of messages separates the gospel according to John from the others.The life of gospels beyond the canonical is a puzzling question. Very few uncanonical works are called gospels. However, gospel has been used to refer to uncanonical works independently of their self-identification. It may be better to keep two different categories because of the complications. One should be Jesus material and the other should be called gospels. This would make the distinctions much easier because makes the material easier to categorize.The origin of a gospel genre arises from many early Christian writings both inside and outside of the standard known as the canon. Gospel is not used in the idea of the New Testament, and Matthew, Mark, Luke, and John did not put together part of the original writings. The idea of writings being referred as gospels probably came about in the 2d century and was established by the 4th century.Most of the writings outside of the canon were called gospels.

Paradise Lost Essays -- essays papers

Paradise Lost The poem is divided up into 12 books. The measure is English big without rhyme, as that of Homer in Greek, and of Virgil in Latin. (Knopf, 1996) This neglect then of rhyme so little is to be taken for a defect, though it may seem so perhaps to vulgar readers, that it rather is to be esteemed an example set, the first in English, of ancient liberty recovered to heroic poem from the troublesome and modern bondage of writing. (Knopf, 1996) Book One proposes the whole subject of the poem of mans disobedience and the loss of the Paradise where God had situationd him. The snake or Satan is talked about whom is the prime cause of mans fall. Satan who was once at Gods side had revolted and was driven out of heaven along with thousands of angels to a place of utter darkness, filtiest called Chaos.(Knopf, 1996) While they were recovering from being banished from heaven, Satan regroups them with a speech that they still have a chance to regain heaven. In his speech he also tells them of a new world that is to be created along with a new being. To find out if this prophecy is true, Satan convenes a full council in his palace called Pandemonium. This book ends as the consultation begins. Book Two is where the debate among his council has begun and they are discussing basically three ideas. They are wondering if another battle lead help them with the recovery of heaven and if it would be detrimental to their efforts. Some are for this proposal and others against it. The third proposal is to find out the truth of the prophecy of a new world and a new being. Whether the being is equal to them, or inferior. Satan will undertake this journey alone, which is seen as a very skilful thing to do.... ...oo bitter of a man, as he had already lost just about everything except his ability to write at the very end. He will always be an icon in literature, and my look on life is broader for having had the chance to scratch the surface of the man known as canful Milton.BibliographyHill, John Spencer. John Milton Poet, Priest and Prophet. London Macmillin, 1979http//axil.uttawa.a/phoenix/jm-ch-2.htmMarlowe, Christopher. Milton-Whats His Gig? milton.htmlwww.missouri.eduMilton, John. Paradise Lost. (Electronic version.) Internet WWW at URL http//dreamfarer.home.mindspring.com/milton.htm (accessed March 1998).Patterson, Frank Allen. The Students Milton. Appleton-Century-Crofts, Inc. New York 1961 Steadman, John M. Milton and the Renaissance Hero. Oxford at the Clarendon Press, 1967

Their Eyes Were Watching Essay -- Literary Analysis, Zora Neale Hurst

Oftentimes, the avocation for self discovery centers on the search for ones joint. In Zora Neale Hurstons novel, Their Eyes Were Watching Gd the lector learns ab give a fashion Janie, the novels protagonist and hero, as she tells her friend Phoebe how she found her identity. Early on the reader learns that language is an important motif in the novel, yet, Zora Neale Hurston deliberately leaves out Janies voice in the scene where she uses it to save her life (acquit her of murder). In this scene, Janie does not plow through direct discourse or free mixed indirect discourse her testimony is relayed to the reader through the narrator. Zora Neale Hurston did this to clarify the meaning of the novel voice is best used for bill telling (to people who will listen). It is used to tell stories that will be passed around and help others grow. It is a means of mountain pass down history. It is a vehicle for story-telling (folklore). ***include a line or 2 that states and organizes my a rguments*****At first the novel seems as if it is about Janies quest for love. But a deeper look reveals a more profound message. The real story is about Janie overcoming the struggles that keep her from finding her identity. Her identity is tied with her ability to flex a storyteller, which she cannot become until she finds her voice. Janies evolution occurs as she grows to understand the loneliness of silence and how morality is required for community (Meese 47). Her voice is who she is, and just like folklore, it is cause by beliefs, experiences, and dreams. (i.e. another hint that folklore is the identity of her culture). However, having a voice is only half of the battle, knowing when and how to use it is just as important. At the store theory in ... ...Hurston added this scene to show the importance of culture. By not accepting her heritage, Mrs. Turner leads a miserable life because she is rejecting her identity. Janie is not influenced by the white banner of judgmen t. Unlike Mrs. Turners marriage, Janies is real she truly admires her husband and his ability to take most any lil thing and make summertime out of it when times is dull. (173). Hurston wants the people of her culture to be proud of who they are. By not doing so, they lead miserable lives like Mrs. Turners. Conclusion present day folklore is story telling through music. Not all rap and hip hop songs are about sex and drugs. Many artists write songs with meaning. Like Jay Zs Can I live. Include some lyrics and what they mean, telling the black folk of today some morals he learned along the way that helped me become and stay successful.

Early American Settlements :: essays research papers

How Much is Too Much?In order for any society to be successful there must be some kind of law and order. Without some established rules and regulations little would get done and there would be chaos and confusion. But in turn there is another side to the spectrum. At what point ar the rules too much? There comes a point in which enforcements are overbearing and hinder the volume under them. This often seems to be the case in other(a) American times. Though these early laws benefited the foundation of church and state into a more linked community, the often caused many hardships to the citizens under them.In studying laws in early American settlements it seems logical to look at Jamestown first. Jamestown had its problems from the beginning. One of the main ones was the colonists lack of confide to work. The work schedule of the day was considered easy even by modern day standards. Colonists were only required to work 6 hours a day, while the abatement was reserved for persona l leisure time. This from a colony that was practically starving to death. This is one of the few examples in which the laws in early colonial America were real not harsh enough. But this was all about to change.By 1611 things were not good in Jamestown. Many more people had died than had survived the harsh east seacoast winters. People were still frolicking in the streets instead of working hard to ensure their survival. Then Sir Thomas Dale arrives in May of 1611.He was sent to bring even off among the disorganized colonist, and discipline he brought. He published a set of rules now known as "Dales Laws." Many of these rules called for harsh punishments for what today would be theme of as relatively minor wrong doings. But where these rules too harsh? They did after all end up saving the colony. But at what monetary value? Is it worth killing a man over petty theft of a hoe or axe if it leads to the eventual survival of his society? These are all hard questions with no definite anwsers. But one thing is for sure, had it not been for Dale and his strict enforcements the colony of Jamestown would have certainly perished.Two other early colonies that deserve mention were the Pilgrim colony at Plymouth and the Puritan settlement in Massachusetts Bay. The colonists which resided here were unlike the early settlers of Jamestown in that order was always a primary concern of theirs.

Early American Settlements :: essays research papers

How Much is Too Much?In order for any society to be self-made there must be some kind of law and order. Without some established rules and regulations little would get done and there would be chaos and confusion. moreover in turn there is another side to the spectrum. At what point ar the rules too much? There comes a point in which enforcements are overbearing and hinder the pot under them. This often seems to be the case in untimely American times. Though these early laws benefited the foundation of church and say into a more united community, the often caused many hardships to the citizens under them.In studying laws in early American settlements it seems logical to look at Jamestown first. Jamestown had its problems from the beginning. superstar of the main ones was the colonists lack of desire to work. The work schedule of the day was considered easy even by modern day standards. Colonists were only required to work 6 hours a day, while the rest was reserved for personal leisure time. This from a colony that was practically starving to death. This is one of the few examples in which the laws in early colonial America were actually not tart enough. But this was all about to change.By 1611 things were not good in Jamestown. Many more people had died than had survived the harsh east coast winters. People were still frolicking in the streets instead of working hard to ensure their survival. Then Sir Thomas Dale arrives in May of 1611.He was sent to bring discipline among the disorganized colonist, and discipline he brought. He published a set of rules now known as "Dales Laws." Many of these rules called for harsh punishments for what today would be thought of as relatively minor wrong doings. But where these rules too harsh? They did after all end up parsimony the colony. But at what price? Is it worth killing a man over petty theft of a hoe or axe if it leads to the eventual(prenominal) survival of his society? These are all hard questions with no definite anwsers. But one thing is for sure, had it not been for Dale and his strict enforcements the colony of Jamestown would have surely perished.Two other early colonies that deserve mention were the Pilgrim colony at Plymouth and the Puritan settlement in Massachusetts Bay. The colonists which resided here were unlike the early settlers of Jamestown in that order was always a primary concern of theirs.

Of Mice and Men Second Chapter Analysis Essay

Steinbeck introduced many new characters over the course of the second chapter, more or less of which atomic number 18 not set at the ranch in Soledad, and met in the bunk house. This new living space, known as the bunk house, provides proof of a very simplistic lifestyle. The small boxes given to each worker for their possessions shows in depth the limited amount of items they scram. Each character have attributes and characteristics that differed from one(a) another. Among these new characters is the old swamper, Curley, Curleys wife, Carlson, Slim, and Crooks. Crooks, who is a nigger (Steinbeck,), acquired the role to be the lasting buck where the boss gives him hell when he gets angry.As far as social hierarchy the boss, who gets pretty mad sometimes, but is a pretty nice (22) guy, holds the most power throughout the ranch, and is closely followed by a character named Slim. This is an extremely interesting insight on how race is approached and dealt with on the ranch. Althou gh Crooks is a nice fella many take it for granted that he should be treated badly since he is black. This notion seems to be imprinted in the minds of the ranchers, even when sight such as the old man argon full of compliments for Crooks.George and Lennie have a very strange relationship. The guys that work on ranches, are the loneliest guys in they world. They got no family (13-14) which is the main reason why Lennie and George have stuck together. Nobody wants to be apart from family in hard times like these. Times have significantly changed in George and Lennies life. Therefore, they better start swimmin, or they will sink like a stone (Bob Dylan) in terms of success and hard work. somewhat believe in a time where hard work runs parallel with achievement. This is not the case, as Steinbeck portrays a time and place where social hierarchy controls the ranch. Curly, who is a fairly powerful figure among the men, hates big guys and often picks scraps with big guys.Kind of like he s mad at em because he aint a big guy. He also has a wife in which he is far too proud of, to the taper where he shows dark to the workers by wearing a glove on one of his hands. This is unusual but is a symbol of their sexual relationship shown off to make himself seemsuperior and greater than. With the power that Curly holds, thoughts are given off that his wife holds the same level of power because she is Curlys husband. This is a wrongly noted thought since she is among a farm full of male workers.Therefore, her sex acquires no power in terms of work and ideas on the ranch. By bringing Curlys wife into the picture in such a flashy and slutty type of fashion, he is possibly giving prefigurative in the sense that she could be a dangerous force throughout the story and a real piece of jail bait (31) towards the men on the ranch. Curlys power causes most of the other men to avoid her eyes, but Lennie stares with fascination at this beautiful woman. Steinbeck possibly gives off th is signal hinting that something special will happen between the two.Steinbecks use of dialogue is very powerful and assuring. It brings a slight authenticity to the setting in which creates an easier scenario to key pictures in the minds of his readers. Another theme that is introduced in the second chapter is the idea of social isolation. The story deeply thrives on the notion that everyone is isolated, and that everyone appears to get along well with one another by talking about their isolation. Apart from obvious reasons associated with race, Crooks is also isolated when he becomes disabled when a horse kicked him in the back causing him to be slower and unable to accomplish certain tasks.Another important symbol that has been introduced is Candys dog, which symbolizes the fate that is waiting for the bulk who have overstayed their welcome and who have outlived what they are able to accomplish. More times than not, a new distich of fresh legs beats and old pair. Although, wh en the old pair still has experience and skill to bring to the table he can still be used effectively. The relation between Candy and his dog are very close because when Carlson suggests that Candy should take one of Slims puppies it signifies that the same idea could be drawn up about Candy.

How Entrepreneurship in the Hospitality?

How Entrepreneurship in the Hospitality and touristry exertion can be a Cause of Ethical Concerns? At a more fundamental level, it can be argued that the very nature of what some might refer to as acting in an entrepreneurial bureau raises honorable questions. (Morris et al. , 2002 p 31). In many academic studies, the hospitality and tourism sector has been associated with low degree of entrepreneurial behaviour.Mentions can be made of the likes of the internationally endorsed Conrad Hilton and Thomas Cook, with the more recent innovators much(prenominal) as Richard Branson and Stelios Haji-Ioannou, all of whom have deeply transformed their respective sectors. However, the international tourism industry seems to be miss entrepreneurial impulse in contrast to other sectors (Page et al. , 1999 Andriotis, 2002 Morrison & Teixeira, 2003). This short paper aims to explain the ethical issues associated with entrepreneurship and how it could concern the tourism and hospitality industr y.By cross-referencing the theories of morals and entrepreneurship, the ethical and prise dilemmas that underlie this issue go forth also be discussed and analysed on the macro and micro environs. This assignment will rely on case studies which will instigate managers in different aspects such as the identification of the stakeholders involved and its implications, and the provision of potential measures focussing on the implementation of professional judgements as part of strategic planning with the goal of redressing this issue.Conceptual and Theoretical Foundations on Entrepreneurship Ethics Ethics focusses on the self-awargonness between what iodine represents right and wrong. It emphasises with the grounds and nature of morality, incorporating rules of conduct, moral judgements and standards (Taylor, 1975). Hunt and Vitells model (1993) highlights three important ethical theories and explain how personal moral codes are being influenced by deontological, theological or en vironmental practices.Other major macro-environmental ethical theories include stockholder, stakeholder and affable contract theories (extended to Integrative sociable Contracts Theory (ISCT) by Donaldson and Dunfee in1994). The entrepreneurial Context of Ethics According to Morrison (2000a), Greenbank (2001) and Pittaway (2005), entrepreneurship is assimilated with a multi-dimensional attitude that coordinates economic and non-economic behaviours such as ideology, legitimacy, social mobility and psychological factors (McKay, 2001). Vyakarnam et al. 1997) demonstrate that small business entrepreneurship ethics could be classified under three themes the impact of the owners temperament on business ethics, which is leading to the conflicts of personal values, and the entrepreneurial activity itself. On a macro-economic level, it has been demonstrated that entrepreneurship is linked to distinctive challenges emerging from industry settings. bare-ass enterprises are often subject to limited financial resources, recurrent over-dependence on a restricted offer, their propensity to depend on a niche consumer base, and constant environmental changes.A moderately restricted market presence, inhering small enterprises to significant demand instability, enhanced by the lack of support from distributors and suppliers, an aggressive competitors penetration may also impact start-ups negatively (Boyd and Gumpert, 1983). Stages of Entrepreneurship reading According to extensive literature review, entrepreneurial training stages (Figure 1) have a profound impact on ethics as the company develops and grows from venture ideas to a mature organisation (Dodge, 1992). While small business entrepreneurs differed significantly from their big business counterparts, Longenecker et al. (1989) could not demonstrate one as being more or less ethically strict. Therefore, it seems that the ethical evolution of companies is inherent to a number of countering forces which depends on man y factors, starting from the development stage of the company. While, limited management controls, pragmatic operational demands, and lack of public visibility associated in the earth stages may adversely impact ethical consideration, the entrepreneurs personal beliefs and pride may encourage a higher ethical focus. Figure 1 Evolution in the ethical reference fate as ventures grow (Morris et al. 2002) How the Organisational Context affect Entrepreneurship Other ethics challenges may arise from the organisational structure, relating to the stakeholder theory discussed previously. Especially, the initial stages of venture formation the founding entrepreneur is in and of itself linked to the untested structure, while important stakeholders involved have often personal and social apprisalships with the founder. Family, friends or even employees may also be investors which will raise unique and complex ethical problems (Dees and Starr, 1992).These social ties may also engender collu sion and misconduct which may lead to conflicts and increased unethical behaviour. The Social and Economical Role of Entrepreneurship Arguably, the social and moral role of entrepreneurship in economic terms varies. While entrepreneurship views empirically as a key economic development factor there is a divergence about the intrinsic relationship between entrepreneurship and economic development. In an environment that can be particularly contend to entrepreneurs, institutions play an important role in fostering or discouraging entrepreneurship.Mair and Marti (2011) show that in situations where voids can be observed in functioning institutions, new ventures also play a building role by creating new networks of stakeholders, which ultimately will create emerging markets (Sarasvathy and Dew, 2005). Nevertheless, the absence of solid institutions in an environment dominated by well-established entrepreneurial networks can actually hinder the emulation of new ventures by creating fina ncial barriers to entry, and by diluting supplementary entrepreneurial activity (Aidis et al. , 2008).The theory of Empowerment and Social Entrepreneurship It is important to note that entrepreneurships role has traditionally been to empower alternative trails to achievement and/or an opt-out option to modern living (Scase, 2000). This concept introduces the concerns with pursuing lifestyle preferences where individuals align entrepreneurial activity (also called of lifestyle entrepreneurship) to fit personal goals and lifestyle (Kaplan 2003, Botlon and Thompson 2003). It is therefore reasonable to meet that this role could relate to social entrepreneurship (Bridge et al. , 2003).With a stronger focus on social development than the concept of entrepreneurship, Bystydzienski (1992) suggests that empowerment allows an individual to gain the ability to hold power to the extent of self-governing and plastic daily life. By doing so, the initiator becomes more involved in a process of social, economic, psychological and political change which represents the four underpinning theories of Scheyvens (1999) model of empowerment. In the case of women-owned small businesses, Heyser (2006) observes that the role of women empowerment could be used as potential catalysts for more profound societal changes.Al-Dajani (2007, p. 20) defined womens empowerment as a continuous, on-going process entailing enhanced abilities to control choices, decisions and actions. This definition reiterates that women empowerment could be seen as a central condition to positive change and progress at heart a wider community. In a more recent article, Al-Dajani & Carter (2010), advocate that the influence and respect of empowered women within the household, community and society at large is increased.In this sense, ones could assume that the need for social change could be initiated at topical anesthetic levels by the empowerment of women through entrepreneurial activities, especially in cou ntries where the suppression of womens troth is largely accepted and observed. The Factors emerging from Entrepreneurship From the preceding discussion emerges the notion of an individuals assessment of social acceptability, appeal and viability influenced by ethnical attitudes and norms, socio economic factors and the relation between the entrepreneur and their host community (Jones, 2000).It is then debatable that entrepreneurs could be either seen as reactive or proactive individuals in this process. Entrepreneurs are not necessarily driven by tangible assets, such as maximisation of a return on investment, or the exploitation of marketing opportunities. The role of Industry Settings in Entrepreneurship Due to low legal and professional barriers to entry, the industry setting could be seen as the prospective ground for entrepreneurs to apply their innovative process (Morrison, 1998b Szivas, 2001). Moreover, a topical anaesthetic research by Nyaupane et al. 2006) found that tour ism growth in the Annapurna region, an area dependant on climbing and trekking tourism, has enhanced the quality of life for the local population and has helped the revival of regional traditional culture. This was echoed by another more recent study from Walker et al. (2011), which highlights that the involvement in the production of hospitality function is particularly suitable for women in developing regions due to their limited literacy and low levels of education. Conclusion The overall findings from the case study (McMillian et al. 2011) highlight that womens empowerment in the hospitality and tourism industry has improved their self-sufficiency and quality of life by reducing their workloads. At a more local level, the access to a wider occupational opportunities and schooling alternatives have initiated the chance for children and younger siblings to make their own life decisions. However, the gain of respect that women have secured is fundamentally linked with the increase of taxation generated though their businesses. This condition shows how crucial economic empowerment is in the overall process.Also, political empowerment of women is still problematic, especially in a larger cultural context. Although developmental efforts were initiated by national governments, gender equality progresses have yet to penetrate communities at a local level. excellent family businesses facilitate the wealth creation process to rural and peripheral communities and local economies, by positively contributing to social and financial capital gain. In doing so, the sustenance of natural environments, crafts and traditions which might other than disappear are often regenerated. References Al-Dajani, H. 2007), Womens Empowerment A Comparison Between no-profit and For-profit Approaches in Empowering Home-based Women Producers, University of Strathclyde, Glasgow. Al-Dajani, H. and Carter, S. (2010), The empowerment of self-employed home-based women producers evidence from Jordan, in Brush, C. , Gatewood, E. , de Bruin, A. and Henry, C. (Eds), Women Entrepreneurs, Edward Elgar, Cheltenham. Andrews, R. , Baum, T. and Andrew, M. A. (2001), The lifestyle economic science of small tourism businesses, Journal of Travel and Tourism Research, Vol. 1, pp. 16-25. Anand, A. and Josse, O. 2002), Celebrating mountain women moving mountains, moving women, Mountain Research and Development, Vol. 22 No. 3, pp. 233-5. Andriotis, K. (2002), Scale of hospitality firms and local economic development evidence from Crete, Tourism Management, Vol. 23 No. 4, pp. 333-42. Basu, A. (2004), Entrepreneurial aspirations among family business owners an analysis of ethnic business owners in the UK, International Journal of Entrepreneurial Behaviour & Research, Vol. 10, pp. 12-33. Beaver, G. (2002), Small business, Entrepreneurship and go-ahead Development, Financial clock/Prentice Hall, London. Bennett, L. Tamang, S. , Onta, P. and Thapa, M. (2006), Unequal Citizens Gender, Ca ste and Ethnic Exclusion in Nepal, Department for International Development, The World Bank, Kathmandu. Bolton, B. and Thompson, J. (2003), The Entrepreneurs in Focus Achieve Your Potential, Thomson Learning, London. Bridge, S. , ONeill, K. and Cromie, S. (2003), Understanding effort, Entrepreneurship and Small Business, Palgrave Macmillan, Basingstoke. Brockhaus, R. (1994), Family business a blessing or a curse? Keynote Address, Proceedings of the Small Enterprise Association of Australia and New Zealand Conference, Auckland, NZ, 25-27 September.Burns, P. (2001), Entrepreneurship and Small Business, Palgrave Macmillan, Basingstoke. Bystydzienski, J. (1992), Women Transforming Politics Worldwide Strategies for Empowerment, Indiana University Press, Bloomington, IN. Cameron, A. and Massey, C. (1999), Small and Medium-sized Enterprises A New Zealand Perspective, Addison Wesley Longman New Zealand, Auckland. Carland, J. W. , Hoy, F. , Boulton, W. and Carland, J. A. (1984), Differenti ating entrepreneurs from small business owners a conceptualisation, The honorary society of Management Review, Vol. 9 No. , pp. 354-9. Carter, S. and Shaw, E. (2006), Womens Business Ownership Recent Research and Policy Developments, DTI Small Business Service Research Report, London. Cattarinich, X. (2001), Pro-poor tourism initiatives in developing countries analysis of secondary case studies, Pro-Poor Tourism cultivateing Paper No. 8, available at www. propoortourism. org. uk Chetterjea, R. and Basu, A. (1978), The relationship between social distance and levels of conceptual integration, The Journal of Social Psychology, Vol. 104, pp. 299-300. Connolly, P. and McGing, G. 2007), High performance work practices and competitive advantage in the Irish hospitality sector, International Journal of contemporaneous Hospitality Management, Vol. 19 No. 3, pp. 201-10. Craig, J. and Lindsay, N. (2002), Toward a theory of incorporating the family dynamic into the entrepreneurship process a case of corporate governance, Journal of Small Business and Enterprise Development, Vol. 9 No. 4, pp. 416-30. Cromie, S. , Adams, J. , Dunn, B. and Reid, R. (1999), Family firms in Scotland and Northern Ireland an empirical investigation, Journal of Small Business and Enterprise Development, Vol. No. 3, pp. 253-66. Ford, R. C. and Heaton, C. P. (2001), Lessons from hospitality that can serve anyone, organizational Dynamics, Vol. 30 No. 1, pp. 30-47. Getz, D. and Carlsen, J. (2000), Characteristics and goals of family and owner-operated businesses in the rural tourism and hospitality sectors, Tourism Management, Vol. 21 No. 6, pp. 547-60. Harris J. et al. (2010), Ethics and Entrepreneurship, Journal of Ethics and Entrepreneurship, vol 1, pp7-26 Heyzer, N. (2006), Poverty and Womens Work in the Informal Economy, World Bank, Washington, DC. Hofstede, G. 1984), Cultures Consequences International Differences in Work-related Values, Sage, London. Irvine, W. and Anderson, A. (2004), Sma ll tourist firms in rural areas agility, vulnerability and survival in the side of meat of crisis, International Journal of Entrepreneurial Behaviour & Research, Vol. 10 No. 4, pp. 229-46. Jones, K. (2000), Psychodynamics, gender, and reactionary entrepreneurship in metropolitan Sao Paulo, Brazil, Women in Management Review, Vol. 15 No. 4, pp. 207-17. Kaplan, J. (2003), Patterns of Entrepreneurship, john Wiley & Sons, Englewood Cliffs, NJ. Kets de Vries, M. 1996), Family Business Human Dilemmas in the Family Firm, Thomson International Business Press, London. Kirzner, I. (1979), Perception, Opportunity and Profit Studies in the Theory of Entrepreneurship, London University Chicago Press, Chicago, IL. Klidas, A. , Van Den Berg, P. T. and Wilderom, C. P. M. (2007), Managing employee empowerment in luxury hotels in Europe, International Journal of Service Industry Management, Vol. 18 No. 1, pp. 70-88. Garrison, T. (1996), International Business Culture, Elm Publications, Huntingdon. Giddens (1984) The Constitution of Society intimate of the Theory of Structuration.University of California Press. Los Angeles, CA Goffee, R. (1996), Understanding family businesses issues for further research, International Journal of entrepreneurial Behaviour & Research, Vol. 2 No. 1, pp. 36-48. Greenbank, P. (2001), Objective setting in the micro-business, International Journal of Entrepreneurial Behaviour & Research, Vol. 7 No. 3, pp. 108-27. Habbershon, T. and Williams, M. (1999), A Resource Based Framework for Assessing the Strategic Advantages of Family Firms, Working Paper Series 101, The Wharton School, University of Pennsylvania, Philadelphia, PA.Kollmair, M. , Manandhar, S. , Subedi, B. and Thieme, S. (2006), New figures for old stories migration and remittances in Nepal, Migration Letters, Vol. 3 No. 2, pp. 151-60. Lashley, C. (1995), Towards an understanding of employee empowerment in hospitality services, International Journal of Contemporary Hospitality Management, V ol. 7 No. 1, pp. 27-32. Lockyer, C. and Morrison, A. (1999), Scottish Tourism Market Structure, Characteristics and Performance, Scottish Tourism Research Unit/Fraser of Allander Institute, University of Strathclyde, Glasgow. Lynch, P. 1999), Host attitudes towards guests in the homestay sector, Tourism and Hospitality Research, Vol. 1 No. 2, pp. 119-44. McAdam, R. , McConvery, T. and Armstrong, G. (2004), Barriers to foot within small firms in a peripheral location, International Journal of Entrepreneurial Behaviour & Research, Vol. 10 No. 3, pp. 206-21. McClelland, D. (1961), The Achieving Society, Van Nostrand, Princeton, NJ. McMillan C et al. , (2011), mercantile hospitality A vehicle for the sustainable empowerment of Nepali women, International Journal of Contemporary Hospitality Management, Vol. 23 Iss 2 pp. 189 208McKay, R. (2001), Women entrepreneurs moving beyond family and flexibleness, International Journal of Entrepreneurial Behaviour & Research, Vol. 7 No. 4, pp. 148 -65. Morgenstern O (1951) ASTIA Document Number ATI 210734 (unpublished manuscript) Middleton, V. and Clarke, J. (Eds. ) (2001), Marketing in Travel and Tourism, Butterworth-Heinemann, Oxford. Morrison, A. (1998b), Small firm statistics a hotel sector focus, The Service Industries Journal, Vol. 18 No. 1, pp. 132-42. Morrison, A. (2000a), Entrepreneurship what triggers it? , International Journal of Entrepreneurial Behaviour & Research, Vol. No. 2, pp. 59-71. Morrison A. , (2006), A contextualisation of Entrepreneurship, International Journal of Entrepreneurial behaviour & Research, Vol. 12 Iss 4 pp. 192-209 Morrison, A. and Teixeira, R. (2002), Small hospitality firms business performance obstacles, paper presented at the International Small Hospitality and Tourism Firm Conference, Leeds Metropolitan University, Leeds. Morrison, A. and Teixeira, R. (2003), Small firm performance in the context of agent and structure a cross cultural comparison in the tourism accommodation sector, in Thomas, R. Ed. ), Small Firms in Tourism International Perspectives, Elsevier, Oxford. Nyaupane, G. , Morais, D. and Dowler, L. (2006), The role of community involvement and number/type of visitors on tourism impacts a controlled comparison of Annapurna, Nepal and Northwest Yunnan, mainland China, Tourism Management, Vol. 27 No. 6, pp. 1373-85. Omar, A. and Davidson, M. (2001), Women in management a comparative cross-cultural overview, Cross Cultural Management, Vol. 8, pp. 35-67. Page, S. , Forer, P. and Lawton, G. (1999), Small business development and tourism terra incognita? , Tourism Management, Vol. 20, pp. 435-59. Pittaway, L. (2005), Philosophies in entrepreneurship a focus on economic theories, International Journal of Entrepreneurial Behaviour & Research, Vol. 11 No. 3, pp. 201-21. Phillips, K. W. , Rothbard, N. P. and Dumas, T. L. (2009), To grant or not to disclose? Status distance and self-disclosure in diverse environments, Academy of Management Review, Vol. 34 No. 4 , pp. 710-32. Ridgeway, C. L. , Li, Y. E. , Erickson, K. G. , Backor, K. and Tinkler, J. E. (2009), How easily does a social difference become a condition distinction?Gender matters, American Sociological Review, Vol. 74 No. 1, pp. 44-62. Scase, R. (2000), The enterprise culture the socio-economic context of small firms, in Carter, S. and Jones-Evans, D. (Eds), Enterprise and Small Business, Financial Times/Prentice Hall, London, pp. 32-47. Scase, R. and Goffee, R. (1989), The Real World of the Small Business Owner, Routledge, London. Scottish Executive (2001), A Smart, Successful Scotland Ambitions for the Enterprise Network, Scottish Executive, Edinburgh. Scheyvens, R. (1999), Ecotourism and the empowerment of local communities, Tourism Management, Vol. 0 No. 2, pp. 245-9. Selznick P. , (1948), Foundations of the theory of organizations, American Sociological Review, Vol. 13 pp2535 Sherwood, A-M. , Parrott, N. , Jenkins, T. , Gillmor, D. , Gaffey, S. and Cawley, M. (2000), Craft producers on the Celtic fringe marginal lifestyles in marginal regions? , paper presented at the 15th International Society for the Study of Marginal Regions Seminar, Newfoundland. Szivas, E. (2001), Entrance into tourism entrepreneurship a UK case study, Tourism and Hospitality Research, Vol. 3 No. 2, pp. 163-72. Thomas, R. , Lashley, C. Rowson, B. , Xie, G. , Jameson, S. , Eaglen, A. , Lincoln, G. and Parsons, D. (2001), The topic Survey of Small Tourism and Hospitality Firms 2001, Centre for the Study of Small Tourism and Hospitality Firms, Leeds Metropolitan University, Leeds. Walker, S. , Valaoras, G. , Gurung, D. and Godde, P. (2001), Women and mountain tourism redefining the boundaries of policy and practice, in Apostolopoulos, Y. , So? nmez, S. and Timothy, D. J. (Eds), Women as Producers and Consumers of Tourism in Developing Regions, Praeger Publishers, Westport, CT, pp. 211-34.

Education Gap and Social Mobility

America may be the land of opportunities, but it is also the land of inequalities(Lareau, pg3). The American dream is perceived to be obtainable for everyone, not on a rigid sectionalisation structure, but the rising concern of an educational gap and social mobility presents a un auditioned theory that may deviate this notion. Throughout Unequal Childhoods Class, Race, and Family Life, by Annette Lareau, Racial and Ethnic Stratification in Education Achievement and Attainment, by Grace Koa and Jennifer S.Thompson, and the black-white test score gap, by George Farkas, each with its make approach, analyze the pre-exiting relationship between race, ethnicity, social level, and the academic performance and achievement attainment of different counterparts. Essentially, each with its own childrearing practices that could pertain to the level of success an one-on-one is exposed to. Unequal Childhoods Class, Race, and Family Life, is a sociological study that draws in-depth observations of black and white middle-class, working-class, and poor families.Author Annette Lareau, introduces the power of the social class and their limitations in which may either benefit or become a disadvantage for some. While the important of social class is often overlooked, Lareau ventures out to overthrow the notion that this country is fundamentally open. While the common belief is that people who demonstrate hard work, effort and talent, uphold equal life chances, and are satisfactory of achieving upward mobility, Lareau challenges the idea that success is solely in the hands of the individual, but more so the parents social location that systematically shapes a childs daily life.While observing numerous counterparts, she argues that social categories are important to conclude in order to help understand the behavior of family members and their subroutine of their daily lives. Annette Lareau develops and introduces two types of childrearing practices, concerted cultivation and the accomplishment of natural growth. Among her notion that social class is pertinent to a childs outcome, it is also derived from the childrearing practices of a parent.While concerted cultivation provides a child of middle class more opportunities, it may also come with a weighted cost. As for natural growth, it provides an individual with kinship and the ability to attain relationships, but withdrawals the opportunity to proficient in a school or professional setting. Essentially Lareau focuses on social class and child-rearing practices to provide evidence and prove her theory about social inequality.

Budget Process

A. THE BUDGET PREPARATION PROCESS OBJECTIVES OF BUDGET PREPARATION During work out eagerness, trade-offs and prioritization among programs must be make to moderate that the compute fits governing policies and priorities. Next, the around cost-effective variants must be selected. Finally, convey of increasing operational efficiency in g all overnment must be sought. None of these understructure be accomplished unless financial backwardnesss argon built into the plow from the actually start. Accordingly, the work out formulation put to work has four major dimensions1 Setting up the financial targets and the level of phthisiss compatible with these targets. This is the target of preparing the macro- sparing role model. Formulating ingestion policies. Allocating resources in consent with twain policies and financial targets. This is the main objective of the amount of money swear outes of figure facility. Addressing operational efficiency and doing issue s. This chapter focuses on the core processes of work out preparation, and on mechanisms for total disbursal consider and strategic allocation of esources. Efficiency and performance issues argon discussed in chapter 15. Operational efficiency questions directly colligate to the arrangements for work out preparation atomic number 18 discussed in Section D below. B. THE IMPORTANCE OF A MEDIUM-TERM PERSPECTIVE FOR BUDGETING The need to address all collar objectives of mankind uptake management pecuniary discip ocellus, strategic resource allocation, and operational efficiencyis emphasized in chapter 1. This calls for a link surrounded by form _or_ system of regimen and cyphering and for a perspective beyond the immediate future.Of course, the future is inherently uncertain, and the more so the longer the bound considered. The general trade-off is in the midst of constitution relevance and certainty. At one extreme, regimen budgeting for just the following week wou ld suffer the least uncertainty notwithstanding also be al n other(a) ir germane(predicate) as an putz of policy. At the other extreme, budgeting for a period of too some(prenominal) years would provide a ample context except carry much greater uncertainty as well. 2 In intrust, multiyear means medium-term, i. e. , a perspective sweep uping one-third to five years including the budget year.Clearly, the feasibility in pr actuateice of a multiyear perspective is greater when revenues be predictable and the mechanisms for concealling outgo well- developed. (The U. K. , for congresswoman, has recently moved beyond a multiyear perspective to an outright three-year budget for intimately budgetary accounts. ) These conditions do not exist in many develop countries. 3, The dilemma is that a multiyear perspective is especially important in those countries where a benefit sense of policy direction is a must for sustainable development, and popular managers ar often in sore ne ed of some predictability and flexibility. The dilemma that a multiyear perspective is especially needed where it is least feasible cannot be resolved easily, but must not be ignored. On the one hand, to try and prevail the age horizon of the budget process under conditions of severe revenue uncertainty and spineless expenditure control would merely lead to frequent changes in ceilings and appropriations, quickly degenerate into a ballistic exercise, and dis reference book the approach itself, and so compromising later attempts at make betterment.On the other hand, to remain wedded to narrow short management of public expenditure would preclude a move to improved linkage between policies and expenditures. In practice, and so, efforts should constantly be exerted to improve revenue prediction ( done such means as relieving administrative or policy- make pressures for overoptimistic forecasts), and strengthen the linkages between policy formulation and expenditure, as well a s the expenditure control mechanisms themselves. As and when these efforts stomach progress, the time horizon for budget preparation can and should be lengthened. Because revenue-forecasting mprovements and the strengthening of policy-expenditure links and expenditure control mechanisms are important in any event, efforts to achieve these can yield the double benefit of improving the short-term budget process at the same(p) time as they give up expanding the budget time horizon to take account of developmental priorities. Therefore, although in almost all countries government budgets are prepared on an yearly unit of ammunition, to be formulated well they must take into account events outside the yearbook cycle, in particular the macroeconomic veryities, the expected revenues, the longer-term be of programs, and government policies.Wildavsky (1986, p. 317) sums up the competitions against separate annual budgeting as follows short-sightedness, because lonesome(prenominal) t he next years expenditures are reviewed over using up, because huge disbursements in future years are hidden conservatism, because incremental changes do not open up large future vistas and parochialism, because programs tend to be viewed in isolation quite an than in comparison to their future costs in likeness to expected revenue. Specifically, the annual budget must resile three paramount multiannual affections The future re genuine costs of roof expenditures The funding needs of entitlement programs (for congressman debt service and transfer payments) where expenditure levels may change, even though basic policy remains the same Contingencies that may result in future consumption requirements (for example government loan guarantees ( look into chapter 2). A medium-term outlook is necessary because the time span of an annual budget is too short for the purpose of counterbalanceing expenditure priorities and uncertainties turn over too great over the longer term.At th e time the budget is formulated, most of the expenditures of the budget year become already been committed. For example, the salaries of permanent civil servants, the pensions to be give to retirees, debt service costs, and the like, are not variable in the short term. Other costs can be adjusted, but often only marginally. The margin of run is typically no more than 5 percent of total expenditure. This means that any real adjustment of expenditure priorities, if it is to be successful, has to take place over a time span of several years.For instance, the government may wish to switch from blanket provision of welfare services to targeted provision designed for those most in need. The expenditure implications of such a policy change str etc. over several years, and the policy indeed can enceintely be apply through a blinkered focus on the annual budget. Medium-term spending projections are also necessary to demonstrate to the administration and the public the desired direction of change.In the absence of a medium-term program, rapid spending adjustments to reflect changing circumstances will tend to be across-the-board and ad hoc, focused on inputs and activities that can be cut in the short term. (Often, these are important public investing expenditures, and one of the typical outcomes of annual budgeting under constrained circumstances is to define public investing in effect as a mere residual. ) If the expenditure adjustments are not policy-establish, they will not be sustained.By illuminating the expenditure implications of watercourse policy decisions on future years budgets, medium-term spending projections enable governments to evaluate costeffectiveness and to determine whether they are attempting more than they can afford. 5 Finally, in purely annual budgeting, the link between sectoral policies and budget allocations is often weak. Sector politicians announce policies, but the budget often fails to provide the necessary resources. However, devil pitfalls should be avoided. First, a multiyear expenditure approach can tself be an occasion to develop an evasion strategy, by pushing expenditure off to the out-years. Second, it could lead to cl commences for increased expenditures from line ministries, since in the altogether programs are easily transformed into entitlements as soon as they are entangled in the projections. To avoid these two pitfalls, many developed countries acquire limited the arena of their multiyear expenditures aims to the cost of existing programs, without making room for new programs. 6 Three variants of medium-term year expenditure programme can be considered A mere practiced projection of the forward costs of ongoing programs (including, of course, the repeated costs of enthronisations). A stringent planning approach, consisting of (i) programming savings in nonpriority sectors over the planned period, to run room for higherpriority programs but (ii) including in the multiyear program ongoing programs and only those new programs that are included in the annual budget genuinely under preparation or for which financing is certain. much(prenominal) plans include only a few new projects beyond their first planned year (e. g. the Public Investment program prepared in Sri Lanka until 1998). The classic planning approach, which identifies explicitly new programs and their cost over the entire period. This includes development plans covering all expenditures, or many public investment programs currently prepared in several developing countries, as well as expenditure plans prepared in developed countries in the 1970s. Where the institutional mechanisms for sound policy decision making and for budgeting are not in place, this approach can lead to overloaded expenditure programs.The feasibility of implementing these antithetic approaches and their linkages with the annual budget depends on the capacity and institutional context of the specific country. However, the a nnual budget should ever so be placed into some kind of multiyear perspective, even where formal multiyear expenditure programming is not feasible. For this purpose two activities are a must (i) systematic estimates of the forward costs of ongoing programs, when reviewing the annual budget requests from line ministries (ii) aggregate expenditure estimates consistent with the medium-term macroeconomic framework (see section C).It is often objected that estimating forward costs is tricky, especially for repeated costs of new public investment projects. This is true, but irrelevant, for without such estimates budgeting is reduced to a short sighted and parochial exercise. Please see attached Figure 4. xls C. CONDITIONS FOR SOUND BUDGET PREPARATION In entree to a multiyear perspective, sound annual budget preparation calls for making early decisions and for avoiding a number of questionable practices. 1. The need for early decisions By ex scene, preparing the budget entails hard cho ices.These can be made, at a cost, or avoided, at a far greater cost. It is important that the necessary trade-offs be made explicitly when formulating the budget. This will permit a smooth implementation of priority programs, and avoid disrupting program management during budget execution. Political considerations, the avoidance mechanisms mentioned below, and lack of needed information (notably on chronic commitments), often lead to postponing these hard choices until budget execution. The postponement makes the choices harder, not easier, and the consequence is a less efficient budget process.When revenues are overestimated and the impact of go on commitments is underestimated, sharp cuts must be made in expenditure when executing the budget. Overestimation of revenue can come from technical factors (such as a bounteous appraisal of the impact of a change in tax policy or of increased tax expenditures), but often also from the desire of ministries to include or maintain in the budget an excessive number of programs, while downplaying difficulties in financing them. Similarly, while underestimation of expenditures can come from unrealistic assessments of the cost of unfunded liabilities (e. g. enefits granted outside the budget) or the impact of permanent obligations, it can also be a deliberate tactic to launch new programs, with the target of requesting increased appropriations during budget execution. It is important not to assume that technical improvements can by themselves resolve institutional problems of this nature. An overoptimistic budget leads to accumulation of payment arrears and muddles rules for compliance. Clear signals on the amount of expenditure compatible with financial constraints should be abandoned to spending agencies at the start of the budget preparation process.As will be stressed repeatedly in this volume, it is possible to execute no-goodly a realistic budget, but impossible to execute well an unrealistic budget. There are no copa layic mechanisms to correct the effects of an unrealistic budget during budget execution. Thus, across-the-board appropriation sequestering leads to inefficiently dispersing scarce resources among an excessive number of activities. Selective capital rationing politicizes budget execution, and often substitutes supplier priorities for program priorities.Selective appropriation sequestering combined with a mechanism to regulate commitments partly avoids these problems, but still creates difficulties, since spending agencies lack predictability and time to adjust their programs and their commitments. An ab initio higher, but more realistic, financial deficit target is far preferable to an optimistic target based on overestimated revenues, or underestimated existing expenditure commitments, which will lead to payment delays and arrears. The monetary impact is similar, but arrears create their own inefficiencies and destroy government credibility as well. This is a strong ar gument in favor of measuring the fiscal deficit on a commitment primer coat, see chapter 6. ) To alleviate problems generated by overoptimistic budgets, it is often suggested that a core program within the budget be isolated and higher priority given to this program during budget implementation. In times of high uncertainty of operable resources (e. g. , very high inflation), this approach could possibly be considered as a secondbest response to the situation. However, it has little to recommend it as general practice, and is vastly inferior to the unmistakable alternative of a realistic budget to begin with.When applied to current expenditures, the core program typically includes personnel expenditures, while the noncore program includes a fortune of goods and services. Cuts in the noncore program during budget execution would tend to increase inefficiency, and reduce further the meager operations and maintenance budget in most developing countries. The core/noncore approach is ineffective also when applied to investment expenditures, since it is difficult to halt a project that is already launched, even when it is non-core. Indeed, depending on strong political support, noncore projects may in practice chase out core projects. (See chapter 12 for a discussion of public investment programming. ) 2. The need for a hard constraint Giving a hard constraint to line ministries from the beginning of budget preparation favors a shift from a needs mentality to an availability mentality. As discussed in detail later in this chapter, annual budget preparation must be framed within a sound macroeconomic framework, and should be organized along the following lines A top-down approach, consisting of (i) defining aggregate resources available for public spending (ii) establishing sectoral spending limits that fits government priorities and (iii) making these spending limits know to line ministries A bottom-up approach, consisting of formulating and costing sectoral sp ending programs within the sectoral spending limits and Iteration and reconciliation mechanisms, to produce a constant overall expenditure program. Although the process must be tailored to apiece country, it is generally desirable to start with the top-down approach.Implementation of this approach is always necessary for good budgeting, regardless of the time period covered. The technical articulation of this approach in the context of medium-term expenditure programming is discussed in chapter 13, for the annual budget. 3. Avoiding questionable budgeting practices Certain budgetary practices are widespread but inconsistent with sound budgeting. The main ones are incremental budgeting, open-ended processes, excessive bargaining, and dual budgeting. a. Incremental budgetingLife itself is incremental. And so, in part, is the budget process, since it has to take into account the current context, continuing policies, and ongoing programs. Except when a major shock is required, most s tructural measures can be implemented only progressively. Carrying out every year a zero-based budgeting exercise covering all programs would be an expensive illusion. At the other extreme, however, incremental budgeting, understood as a mechanical set of changes in a detailed line-item budget, leads to very poor results.The dialogue between the Ministry of pay and line ministries is confined to reviewing the different items and to bargaining cuts or increases, item by item. Discussions focus alone on inputs, without any reference to results, between a Ministry of finance typically uninformed intimately sectoral realities and a sector ministry in a negotiating mode. Worse, the negotiation is seen as a zero-sum game, and usually not approached by either party in good faith. Moreover, incremental budgeting of this sort is not even a good instrumental purpose for expenditure control, although this was the initial aim of this approach.Line-item incremental budgeting focuses general ly on goods and services expenditures, whereas the budget busters are normally entitlements, subsidies, hiring or wage policy or, in many developing countries, expenditure financed with counterpart bills from foreign aid. Even the most mechanical and inefficient forms of incremental budgeting, however, are not quite as sturdy as capricious large swings in budget allocations in response to purely political power shifts. b. afford-ended processes An open-ended budget preparation process starts from requests made by spending agencies without clear indications of financial constraints.Since these requests express only needs, in the aggregate they invariably exceed the available resources. Spending agencies have no incentive to propose savings, since they have no guarantee that any such savings will give them extensional financial room to undertake new activities. New programs are included pell-mell in sectoral budget requests as bargaining chips. Lacking information on the relative merits of proposed expenditures, the Ministry of pay is led to making arbitrary cuts across the board among sector budget proposals, usually at the last minute when finalizing the budget.At best, a few days before the deadline for presenting the draft budget to the Cabinet, the Ministry of Finance gives firm directives to line ministries, which then redraft their requests hastily, themselves making cuts across the board in the programs of their subordinate agencies. Of course, these cuts are also arbitrary, since the ministries have not had enough time to reconsider their previous budget requests. Further bargaining then taxes place during the review of the budget at the cabinet level, or even during budget execution. Open ended processes are sometimes justified as a decentralized approach to budgeting.Actually, they are the very opposite. Since the total demand by the line ministries is unavoidably in excess of available resources, the Ministry of Finance in fact has the last wor d in deciding where increments should be allocated and whether reallocations should be made. The less constrained the process, the greater is the excess of aggregate ministries request over available resources, the stronger the role of the central Ministry of Finance in deciding the composition of sectoral programs, and the more illusory the ownership of the budget by line ministries. . Excessive bargaining and conflict avoidance There is always an element of bargaining in any budget preparation, as choices must be made among conflicting interests. An apolitical budget process is an oxymoron. However, when bargaining drives the process, the only predictable result is inefficiency of resource allocation. Choices are based more on the political power of the different actors than on facts, integrity, or results. Instead of transparent budget appropriations, false compromises are reached, such as increased tax expenditures, reation of earmarked bullion, loans, or increased contingent l iabilities. A budget preparation process dominated by bargaining can also favor the emergence of escape mechanisms and a shift of key programs outside the budget. 7 A variety of undesirable compromises are used to avoid internal bureaucratic conflictsspreading scarce funds among an excessive number of programs in an effort to satisfy everybody, deliberately overestimating revenues, underestimating continuing commitments, postponing hard choices until budget execution, inflating expenditures in the second year of a multiyear expenditure program, etc.These conflict-avoidance mechanisms are frequent in countries with weak cohesion within the government. Consequently, improved processes of policy formulation can have benefits for budget preparation as well, through the greater cohesion generated in the government. 8 Conflict avoidance may characterize not only the relationships between the Ministry of Finance and line ministries, but also those between line ministries and their subordin ate agencies.Indeed, poor cohesion within line ministries is often used by the Ministry of Finance as a justification for its leading role in determining the composition of sectoral programs. Perversely, therefore, the all-around bad habits generated by open-ended budget preparation processes may reduce the incentive of the Ministry of Finance itself to push for real improvements in the system. d. Dual budgeting There is frequent confusion between the separate presentation of current and investment budgets, and the issue of the process by which those two budgets are prepared.The term dual budgeting is often used to refer to either the first or the second issue. However, as discussed earlier, a separate presentation is needed. Dual budgeting refers therefore only to a dual process of budget preparation, whereby the responsibility for preparing the investment or development budget is assigned to an entity different from the entity that prepares the current budget. Dual budgeting was a imed initially at establishing allow mechanisms for giving higher priority to development activity.Alternatively, it was seen as the application of a golden rule which would require balancing the recurrent budget and borrowing only for investment. In many developing countries, the organizational arrangements that existed before the advent of the PIP approach in the 1980s (see chapter 12) typically included a separation of budget responsibilities between the key core ministries. The Ministry of Finance was responsible for preparing the recurrent budget the Ministry of Planning was responsible for the annual development budget and for medium-term planning.The two entities carried out their responsibilities separately on the basis of different criteria, different staff, different bureaucratic dynamics, and, usually, different ideologies. In some cases, at the end of the budget preparation cycle, the Ministry of Finance would simply collate the two budgets into a single document that m ade up the budget. Clearly, such a practice impedes the integrated review of current and investment expenditures that is necessary in any good budget process. (For xample, the Ministry of Education will program separately its school construction program and its running costs and try to get the maximum resources for twain, while not considering variants that would consist of building fewer schools and buying more books. ) In many cases, coordination between the preparation of the recurrent budget and the development budget is poor not only between core ministries but within the line ministries as well. While the Ministry of Finance deals with the financial department of line ministries, the Ministry of Planning deals with their investment department.This duality may even be reproduced at subnational levels of government. Adequate coordination is particularly difficult because the spending units responsible for implementing the recurrent budget are administrative divisions, while th e development budget is implemented through projects, which may or may not report systematically to their relevant administrative division. (In a few countries, while current expenditures are paid from the Treasury, development expenditures are paid through a separate Development Fund. ) The psychiatric hospital of rolling PIPs was motivated partly by a desire to correct these problems. Thus, the crux of the dual budgeting issue is the lack of consolidation of different expenditures contributing to the same policy objectives. This real issue has been clouded, however, by a superficial attribution of deep-seated problems to the technical practice of dual-budgeting. For example, dual budgeting is sometimes held responsible for an refinementary bias in government expenditure. Certainly, as emphasized earlier, the initial dual budgeting paradigm was related to a growth model (Harrod-Domar et al) based on a mechanistic relation between the level of investment and GDP growth.This parad igm itself has unquestionably been a cause of public finance overruns and the debt crises inherited in Africa or Latin the States from badquality investment programs of the 1970s and early 1980s. The implicit disregard for issues of implementation capacity, or efficiency of investment, or mismanagement, corruption and theft, is in hindsight difficult to understand. However, imputing to dual budgeting all problems of bad management or weak governance and corruption is equally simplistic and misleading. give the same structural, capacity, and political conditions of those years (including the Cold War), the same outcome of wasteful, and often corrupt, expansion of government spending would have resulted in developing countriesdual budgeting or not. If only the massive economic mismanagement in so many countries in the 1970s and early 1980s could be explained by a single and comforting technical problem of budgetary procedure In point of fact, the fiscal overruns of the 1970s and early 1980s had little to do with the visible dual budgeting.They originated instead from a third invisible budget black boxes, uncontrolled orthogonal borrowing, military expenditures, casual guarantees to public enterprises, etc. 10 Public investment budgeting is submitted to strong pressures because of particular or regional interest (the so-called pork place projects) and because it gives more opportunities for corruption than current expenditures. 11 Thus, in countries with poor governance, there are vested interests in keeping separate the process of preparing the investment budget, and a goal to increase public investment spending.However, under the same circumstances, to concentrate power and bribe opportunities in the hands of a powerful unified-budget baron would scarcely improve expenditure management or reduce corruption. On the contrary, it is precisely in these countries that focusing first on improving the integrity of the separate investment programming process may be the only way to assure that some resources are allocated to economically sound projects and to improve over time the budget process as a whole. 12 By contrast, in countries without major governance weaknesses, dual budgeting ften results in practice in insulating current expenditures (and especially salaries) from structural adjustment. Given the macroeconomic and fiscal forecasts and objectives, the resources allocated to public investment have typically been a residual, estimated by deducting recurrent expenditure needs from the expected amount of revenues (given the overall deficit target). The residual character of the domestic funding of development expenditures may even be aggravated during the process of budget execution, when urgent current spending preempts investment spending which can be postponed more easily.In such a situation, dual budgeting yields the opposite problem unmet domestic investment needs and insufficient counterpart funds for good projects financed on fa vorable external terms. Insufficient aggregate provision of counterpart funds (which is itself a symptom of a bad investment budgeting process) is a major source of waste of resources. Recall that the real issue is lack of integration between investment and current expenditure programming, and not the separate processes in themselves.This is important, because to misspecify the issue would lead (and often has) to considering the problem solved by a round-eyed merger of two ministrieseven while coordination remains just as weak. A former minister becomes a deputy minister, organizational boxes are reshuffled, a few people are promoted and others demoted. But dual budgeting remains breathing and well within the bosom of the umbrella ministry. When coordination between two initially separate processes is close and iteration effective, the two budgets end up consistent with each other and with government policies, and dual budgeting is no great problem.Thus, when the current and inve stment budget processes are separate, whether or not they should be unified depends on the institutional characteristics of the country. In countries where the agency responsible for the investment budget is weak, and the Ministry of Finance is not deeply involved in ex-ante line-item control and day-to-day management, transferring responsibilities for the investment budget to the Ministry of Finance would tend to improve budget preparation as a whole. (Whether this option is preferable to the alternative of trengthening the agency responsible for the investment budget can be decided only on a country-specific basis. ) In other countries, one should first study carefully the existing processes and administrative capacities. For example, when the budgetary system is powerfully oriented toward ex-ante controls, the capacity of the Ministry of Finance to prepare and manage a development budget may be in nice. A unified budget process would in this case risk dismantling the existing net work of civil servants who prepare the investment budget, without adequate replacement.Also, as noted, coordination problems may be as severe between separate departments of a single ministry as between separate ministries. Indeed, the lack of coordination within line ministries between the formulation of the current budget and the formulation of the capital budget is in many ways the more important dual budgeting issue. Without integration or coordination of current and capital expenditure at line the ministries level, integration or coordination at the core ministry level is a misleading illusion.On balance, however, the general presumption should be in favor of a single entity responsible for both the investment and the annual budget (although that entity must possess the different skills and data required for the two tasks) Where coherence is at a premium, where any consistent policy may be better than several that cancel each other out, where layers of bureaucracy already frust rate each other, and where a single budget hardly works, choosing two budgets and two sets of officials over one seems strange. The keynote in poor countries should be simplicity.Designs for decisions should be as simple as anyone knows how to make them. The more conglomerate they are, the less likely they are to work. On this basis, there seems little reason to have several organizations dealing with the same expenditure policies. One good organization would represent an enormous advance. Moreover, choosing the finance ministry puts the burden of reform where it should bein the budgetary sphere. 13 D. THE MACROECONOMIC AND POLICY CONTEXT 1. Macroeconomic framework and fiscal targets a. Importance of a macroeconomic frameworkThe starting points for expenditure programming are (i) a realistic assessment of resources likely to be available to the government and (ii) the make-up of fiscal objectives. (There follows, of course, significant iteration between the two, until the desired relationship between resources and objectives is reached. ) As noted earlier, the capacity to translate policy priorities into the budget, and then to ensure conformity of actual expenditures with the budget, depends in large part on the soundness of macroeconomic projections and revenue forecasts.Overestimating revenues leads to poor budget formulation and therefore poor budget execution. (As mentioned earlier, this may sometimes be a deliberate ploy to evade the responsibility for weak budget management and discipline. ) The preparation of a macroeconomic framework is therefore an essential element in the budget preparation process. Macroeconomic projections are not simple forecasts of trends of macroeconomic variables. Projections are based on a definition of argets and instruments, in areas such as monetary policy, fiscal policy, exchange rate and trade policy, external debt policy, regulation and promotion of private-sector activities, and reform of public enterprises. For exam ple, the policy objective of reducing inflation normally corresponds to targets such as the level of the deficit, and the specific instruments can include tax measures and credit policy measures, among others. 14 Projections should cover the current year and a forward period of two to four years. b. monetary targets and indicators The establishment of explicit fiscal targets gives a framework for budget formulation, allows the government to state clearly its fiscal policy and the legislative and the public to monitor the implementation of government policy, and, ultimately, makes government politically as well as financially accountable. Fiscal targets and indicators should cover three areas current fiscal position (e. g. , fiscal deficit), fiscal sustainability (e. g. , debt-, tax-, or expenditure-to-GDP ratios), and vulnerability (e. . , analysis of the composition of the foreign debt). The summary indicator of fiscal position used most commonly is the overall budget deficit on a cash basis, defined as the difference between actual expenditure payments and collected revenues (on a cash basis) plus grants (cash or in kind). 15 The cash deficit is by definition equal to the government borrowing requirements (from domestic or foreign sources) and is thus integrally linked to the money supply and inflation targets and prospects.The deficit is therefore a major policy target to ensure that the budget will be financed in a noninflationary way and without crowding out private investment, while keeping the growth of public debt under control. The cash deficit must always be included in the set of fiscal targets. The cash deficit does not take into account payment arrears and aimless debt. In countries that face arrears problems the deficit on a cash basis plus net increase of arrears is also an important indicator, and is very similar (but not necessarily identical) to the deficit on a commitment basis, i. e. the difference between annual expenditure commitments a nd cash revenues and grants. 16 The IMF Code of Fiscal Transparency requires at least a memorandum coverage arrears, when the country does not use accrual or modified accrual explanation (which would systematically generate reports on overdue accounts see chapter 10). As discussed in chapter 6, the precise definition of commitment varies from one 17 country to another . Commitments include orders not yet delivered, may concern multiyear contracts, or, in some countries, be only the administrative reservation of appropriations.Therefore, when using the deficit on a commitment basis as fiscal indicator, it is necessary to specify what transactions are included in the expenditures on a commitment basis. This indicator would be meaningless if it includes multiyear commitments and commitments that are merely reservations of appropriations. Moreover, to estimate arrears more accurately, orders not yet delivered should be separated from actual expenditures (accrued expenditures, or expen ditures at the verification stage). As discussed in chapters 6 and 10, this requires an adequate accounting system for tracking the uses of appropriations.The primary deficit (on either a cash or a commitment basis) is the difference between noninterest expenditures and revenues and grants. As a target for budget policy, it does not depend on the vagaries of interest rates and exchange rates, and is therefore a better measure of the governments fiscal adjustment effort. In high-inflation countries, to take into account the impact of inflation on the stock of debt, a frequent indicator is the operational deficit, which is equal to the deficit on a cash basis less the inflationary portion of interest payment. 18The current deficit is the difference between current revenue and current expenditure. It is by definition, the government saving, and thus, in theory, the contribution of government to investible resources and economic growth. However, since the current spending of a governmen t may be as important for growth as capital spending, the macroeconomic meaning of this indicator should be interpreted with care. Depending on the circumstances, it may also be necessary to isolate once and for all the fiscal results from other operations, as, for instance, the sale of public assets, or a special recovery of tax arrears. 9 Please see attached Table 2. xls It is essential to underline that the broad objective of fiscal policy is not a specific level of deficit, per se, but a fiscal position that is sustainable in light of policy goals and likely resource availability. Indicators of fiscal sustainability include the ratio of debt to GDP, tax to GDP, net unfunded social security liabilities. The calculation of the deficit on an accrual basis and the assessment of the net worth of the government allows a etter assessment of liabilities and therefore their impact on sustainability (see chapter 10). However, huge movements in net worth can be caused by valuation changes in assets such as land, that the government has no immediate intention of liquidating. Hence, net worth measures could be dangerous if used as indicators for near-term fiscal policy. 20 An assessment of fiscal vulnerability is also needed, especially in countries that benefit from short-term capital inflows.Especially relevant to Asian countries affected by the financial crisis that began in 1997 such an assessment could be based on the analysis of the maturity of government debt, the volume of usable foreign exchange reserves, etc. There is no question that the standard deficit measures may indicate a healthy fiscal situation which is in reality slight. However, as shown by recent developments, guidelines for assessing fiscal vulnerabilities are doubtful and unclear. This question is related to the perennial and difficult issue f early warning systems to predict the probability of an impending fiscal or financial crisis. It may well be that such early warnings are feasible and ap propriate. Among the thorny difficulties, however, there is the risk of a self-fulfilling prophecy, where the early warning itself could cause financial markets to become concerned and hence spark a crisis. Thus, on the balance of the debate, against any real crisis that an early warning system has predicted accurately, one should place other crises, that might not have happened were it not for the warning itself. . Preparation of a macroeconomic framework A macroeconomic framework typically includes projections of the balance of payments, the real sector (i. e. , production), the fiscal accounts, and the monetary sector. It is a tool for checking the consistency of assumptions or projections concerning economic growth, the fiscal deficit, the balance of payments, the exchange rate, inflation, credit growth and the share of the private and public sectors on external borrowing policies, etc. 21 Preparing a macroeconomic framework is always an iterative exercise.A set of initial objec tives must be defined to establish a preliminary baseline scenario, but the final framework requires a progressive reconciliation and converging of all objectives and targets. Considering only one target (e. g. , the fiscal deficit) in this iterative exercise risks defining other important targets as de facto residuals. ecumenic government (see chapter 2) should be considered when preparing the fiscal projections and defining the fiscal targets, but the fiscal targets should also be broken down between central and local government.In some decentralized systems, by law a fiscal target cannot be directly imposed on subnational and local government. In those cases, it is necessary to assess the feasibility of achieving it by means of the different instruments under the control of the central government (such as grants, control of borrowing). However, the constraints on running fiscal deficits are typically much tighter on subnational entities than they are on central government. The main reason is the central governments capacity to regulate money supply. Therefore, in some federal systems (e. . , the U. S. ) many states have their own constitutionally mandated requirement of an annual balanced budget. Fiscal projections should cover the consolidated account of the general government and quasi-fiscal operations by the banking system. Future expenditures related to contingent liabilities as a result of government guarantees should be assessed (see chapter 2). In a majority of developing countries, it is desirable to prepare consolidated accounts of the public sector, to put financing requirements for the public sector as a whole.Very often, however, only the central government is included, giving a misleading fiscal picture and the temptation to transfer the fiscal deficit onto local government entities. This practice is conducive neither to sound fiscal policy nor to the subsidiarity structure appropriate to the specific country. Unfortunately, governments and world-wide financial institutions have paid insufficient attention to this problem. The degree of sophistication of fiscal projections depends on the technical capacities within the country and the availability of data and appropriate tools. Sophisticated odels can be useful. Nevertheless, since the major objective is to set a general frame for formulating macroeconomic objectives and checking their consistency, the preparation of a macroeconomic framework does not necessarily require sophisticated modeling techniques. On the contrary, these techniques may give a sense of misplaced concreteness and a forecast illusion which may embarrass the practical value of the framework. Using simple quasi-accounting models would already represent significant progress in many countries. 22 Such models include mainly accounting relations (e. g. GDP plus net imports equals consumption plus investment) and only a limited number of behavioral relations defined by simple ratios (e. g. , consumptio n, income), without resorting to econometric techniques. The models are also easier to use in discussions on fiscal policy, whereas the outputs of a sophisticated econometric model depend on the approach choose by the modeler, and the process is necessarily more opaque. In any case, forecasting revenues should be based on detailed analyses and forecasts by individual tax rather than on the aggregate outputs of a macroeconomic model.The problems revealed by the projections (e. g. , lack of consistency between economic growth targets and monetary policy) must be discussed among the agencies involved in macroeconomic management. The preliminary baseline scenario gives the macroeconomic information needed for preparing sectoral and detailed projections, but these projections usually lead in turn to revising the baseline scenario. Such iterations should continue until overall consistency is achieved for the macroeconomic framework as a whole. The iteration process is not only necessary for sound macroeconomic and xpenditure programming, but is also an invaluable capacity-building tool, to improve the awareness and understanding of involved agenciesand therefore their cooperation in formulating a realistic budget and implementing it correctly. Please see attached Figure 5. xls The preparation of a macroeconomic framework should be a permanent activity. The framework needs to be prepared at the start of each budget cycle to give adequate guidelines to the line ministries. As noted, it must then be updated throughout the further stages of budget preparation, also to take into account intervening changes in the economic environment.During budget execution, too, macroeconomic projections require frequent updating to assess the impact of exogenous changes or of possible slippage in budget execution. In addition to the baseline framework, it is important to formulate variants under different assumptions, e. g. , changes in oil prices. The risks related to unexpected chan ges in macroeconomic parameters must be assessed and policy responses set in advance, albeit in very general terms, of course. The importance of good data cannot be underestimated. Without reliable information, the macroeconomic framework is literally not worth the piece it is written on.This includes the collection of economic data and the monitoring of developments in economic conditions (both of which are generally undertaken by statistics bureaus) as well as the monitoring and consideration of changes in laws and regulations that affect revenue, expenditure, financing and other financial operations of the government. 2. Aggregate expenditure estimates Typically, a macroeconomic framework is at a very aggregate level on the expenditure side, and shows total government wages, other goods and services, interest, total transfers, and capital expenditures (by source of financing).Assumptions and underlying policy objectives therefore concern the broad economic categories of expendi tures, rather than the allocation of resources among sectors. Moreover, transfers or entitlements are not reviewed in sufficient detail and assumptions on future developments are not compared with continuing commitments. Thus, when elaborating a fiscal framework on the basis of the overall macroeconomic framework, estimates of the impact of the assumptions and the aggregate fiscal targets on the composition of expenditure, by sector or economic category, are required to assess whether the fiscal targets are realistic and sustainable, and to etermine the conditions to meeting these targets. Therefore, the preparation of aggregate expenditure estimates could help in assessing the sustainability of expenditure policy, and thus improve the budget preparation process (notably when defining expenditure ceilings for the various sectors). These estimates could cover (i) the forward costs of large investment projects (ii) projections for the more important entitlements and (iii) aggregate pr ojections of other expenditures, by function and broad economic category.These estimates are less demanding in terms of capacity and institutional process than the formal Medium-Term Expenditure Framework (MTEF) described in chapter 13, but could be a step toward the implementation of a comprehensive MTEF. Indeed, this step is mandatory if some sectoral multiyear expenditure programming exercise is carried out (covering only investment or a few sectors), to prevent inconsistency between the sectoral program and the macroeconomic framework, or the crowding out of expenditure in noncovered sectors or categories.Focusing only on technical issues while neglecting the fundamental question of the division of administrative responsibility inevitably produces a weak or inoperative macroeconomic framework. Some major considerations in this respect are discussed in chapter 5. 3. Consolidating the fiscal commitments a. Making the macroeconomic projections public While the iterative process lea ding to a realistic and consistent macroeconomic framework must remain confidential in many of its key aspects, when the framework is completed it must be made public.The general assembly and the population at large have a right to know clearly the government policy objective and targets, not only to increase transparency and accountability, but also to reach a consensus within civil society. While such a consensus may take additional time, and require difficult debates, it will also be an invaluable foundation for the robust and effective implementation of the policy and financial program. A good example is provided by the government of Hong Kong, China, which annexes its medium-term forecast to the annual budget speech (box 16 and annex VII). Box 16Medium-Range Forecasts The Example of Hong Kong, China The Medium Range Forecast (MRF) is a projection of expenditure and revenue for the forecast period based on forecasting assumptions and budgetary criteria. To derive the MRF, a num ber of computer-based models that reflect a wide range of assumptions about the factors determining each of the components of governments revenue and expenditure were used. As summary is shown here, a fuller description is in Annex VII. Assumptions relating to developing expenditure and revenue forecast over the mediumterm period are the following estimated cash flow of capital projects forecast completion dates of capital projects and their related recurrent consequences in terms of staffing and running costs estimated cash flow arising from new commitments resulting from policy initiatives the expected pattern of demand for individual services the trend in yield from individual revenue sources new revenue measures in 1998-1999 In addition to these assumptions, there are a number of criteria against which the results of forecasts are tested for overall acceptableness in terms of budgetary policy Maintain adequate reserves in the long-termExpenditure growth should not exce ed the assumed trend growth in GDP Contain capital expenditure growth within overall expenditure guidelines Revenue projections reflect new measures introduced in this years budget To summarize, the MRF of Hong Kong is shown below (in $Hk billion) 1998-1999 Revenue 192,680 Expenditure 182,480 Surplus 10,200 Total public expenditure 288,890 Gross domestic product 1,497,880 Growth in GDP (nominal) 12. 9 (real) 5. 0 Public expenditure as a percentage of GDP 19. 3 Forecast years 1999-2000 2000-2001 211,390 242,900 200,740 227,830 10,650 5,070 315,830 354,060 1,690,740 1,908,420 12. 9 12. 9 5. 0 5. 0 18. 7 18. 6 2001-2002 271,330 258,570 12,760 393,980 2,154,130 12. 9 5. 0 18. 3 Source Medium Range Forecast of Hong Kong, The Internet, August 8, 1998. In some countries, government projections are submitted to a panel of separatist and respected experts to ensure their reliability, while preserving the confidentiality required on a few gauzy issues. In other countries, the projections ar e validated by the Auditor General (e. g. , the United Kingdom and the Canadian province of Nova Scotia23).The independence of the Auditor General adds credibility to the projections. However, any other form of participation of audit offices in the budget formulation process would be questionable. In any event, manipulation and alteration of forecasts would soon reduce the governments credibility and hence its influence. b. Binding fiscal targets? Several countries have laws and rules that restrict the fiscal policy of government (fiscal rules). 24 For example, an earlier golden rule stipulated that public borrowing must not exceed investment (thus mandating a current budget balance or surplus).In some cases, the overall budget must be balanced by law (as in subnational government in federal countries). In the European Union, the Maastricht Treaty stipulates specific fiscal convergence criteria, concerning both the ratio of the fiscal deficit to GDP and the debt/GDP ratio. (The form er has been by far the more important criterion. ) One frequent criticism of such rules is that they favor creative accounting and encourage nontransparent fiscal practices. When they are effectively enforced, nondiscretionary rules can also prevent governments from adjusting their budgets to the economic cycle. 5 Aside from the special case of European integration, one may generally consider that, in countries with fragile coalition governments, fragmented decision making, and legislative committees acting as a focus for periodic bargaining, setting up legally binding targets may be appropriate. In other countries, however, binding targets could in effect predetermine the budget before its preparation even begins. 26 In contrast with an approach based on rigid targets, other countries (e. g. , New Zealand) do not mandate specific fiscal targets, but refer to criteria such as prudent levels and credible degrees.It is left to the government to specify the targets in a budget Policy Statement, which presents total revenues and expenses and projections for the next three years. This financial statement is published at least three months before the budget is presented to Parliament, and is reviewed by a Parliament committee but not formally voted by Parliament. 27 Box 17 The New Zealand Fiscal Responsibility Act Enacted in 1994, the New Zealand Fiscal Responsibility Act offers a comprehensive legal framework for formulation and conducting fiscal policy in general, and for incorporating a long-term orientation in the budget process in particular.While many OECD countries have similar practices in place, the Fiscal Responsibility Act is an example of these practices being enacted into law. The primary objective of the Fiscal Responsibility Act was to entrench sound fiscal policies and make it difficult for future governments to deviate from them. There are two provisions of the Act (i) a regime for setting fiscal objectives that focuses attention on the long term and (ii) an extensive system of fiscal reporting with unique mechanisms to ensure its credibility and integrity. The extensive reporting required by the act serves two purposes.First, it serves to monitor the consistency of the governments fiscal actions with its tell fiscal objectives. Second, it brings general transparency to government finances by mandating the disclosure of all relevant fiscal information in a timely manner. The act requires two specialized reports the Fiscal Strategy Report and the PreElection Economic and Fiscal Update. The Fiscal Strategy Report, which is presented to Parliament along with the budget, assesses the consistency of the policy framework contained in the budget with the short-term fiscal intentions and long-term fiscal objectives outlined in the Budget Policy Statement.The Pre-Election Economic and Fiscal Update contains the threeyear forecasts of all key economic and fiscal variables. Both reports contain two statements of responsibility, one b y the Minister of Finance and one by the Secretary to the Treasury (a civil servant). These statements of responsibility aim to clarify the roles of politicians and civil servants in producing reports and give a greater role to civil servants in producing them, thereby increasing the overall credibility of the reports. Source Budgeting for the future, OECD working paper, 1997.More important than specifying ex-ante targets and general criteria is to ensure that institutional arrangements and processes favor coherence among resource constraints, fiscal objectives, and expenditure programs. This broader issue involves the mechanisms for policy formulation, the budget preparation process, the role of the Ministry of Finance in budgeting, and the development of appropriate instruments for reviewing expenditures within a longer period than the annual budget. Box 18 A Good Macroeconomic Coordination Practice The work party of Four in Thailand The Thai system of budgeting is highly centra lized.It embodies a longstanding set of arrangements, rules, and procedures that together help exert discipline on aggregate fiscal management. It grants very little autonomy to line agencies over their budgets, and imposes weak accountability on them for their performance. The hallmark of the Thai budgeting system is aggregate fiscal discipline. A conspiracy of four interacts to control the level of spending and thus the deficit the National Economic and Social Development Board (NESDB), the Ministry of Finance (MOF), the Bank of Thailand (BOT), and the Bureau of the Budget (BOB) in the Prime Ministers Office.The gang of four is responsible for formulating the macroeconomic framework that serves as the basis for the aggregate expenditure ceiling. It also determines for the most part the ministerial ceilings. Prioritization is largely a function of the gang of four. It ensures that the budgetary requests of line agencies are consistent with the objectives of the five-year developme nt plan. The gang of fours control over aggregate allocations to agencies and to expenditure categories implies that it exerts considerable leverage over priority setting.In Parliament, the Budget Scrutiny Committee chaired by the Minister of Finance evaluates the governments proposal. Cabinet members can propose amendments to the governments proposal but seldom make significant changes in allocations to line agencies because of limited technical potentiality to evaluate such proposals. Politicians can alter the allocation of line agencies. After a series of deliberations and negotiations, the committee submits the budget bill to Parliament. The Parliament almost always accepts the bill.Source Campos and Pradhan, Budgetary institutions and expenditure outcomes, 1996. 4. Policy formulation a. Importance of policy formulation The budget preparation process is a powerful tool for coherence. The budget is both an instrument of economic and financial management and an implicit policy st atement, as it sets relative levels of spending for different programs and activities. However, policy decision making is complex and involves different actors in and outside the government.It is a technocratic illusion to embed all policy formulation within the budget process (as to some extent was the ambition of the PPBS see chapter 3). However, a coherent articulation should be sought between the policy agenda (which should take into account economic and fiscal realities) and the budget (which should accurately reflect the governments policy priorities). The budget process should both take into account policies already formulated and be the main instrument for making these policies explicit and operational. However, policies must be defined outside the pressure of the budget process. Making policy through the budget would lead to a focus only on short-term issues and thus to bad policy, since the policy debate would be invariably dominated by immediate financial considerations. (This is frequently the unfortunate outcome in developing countries with weak capacity faced with financial difficulties. ) In earlier times, medium-term development plans were intended as the instrument for setting up government strategy. However, these plans were rigid, invariant, and usually out of synchronize with financial realities.Paradoxically, therefore, they indirectly led in practice to the same dominance of short-term financial considerations. Organizational arrangements are discussed in chapter 5. b. The policy-budget link A duo between the policy making process and the budget process is essential to make policy a breathing reality rather than a statement of wishes. For this purpose at least two clear rules must be established. 28 The resource implications of a policy change should be identified, even if very roughly, before a policy decision is taken.Any entity proposing new policies must quantify their effects on public expenditure, including the impact both on its own spending and on the spending of other government departments. The Ministry of Finance should be consulted in good time about all proposals involving expenditure before they go into ministerial committee or to the center of the government and certainly before any public announcements are made. Within the budget formulation process, close cooperation between the Ministry of Finance and the center of government is required, at both the political and the technical level.The role of the center is to ensure that the budget is prepared along the lines defined to arbitrate or smooth over conflicts between the Ministry of Finance and line ministries and to assure that the relevant stakeholders are appropriately involved in the budget process. (This is a major challenge, which can only be mentioned here but requires care and commitment on a sustained basis. ) An interministerial committee is needed to tackle crosscutting issues and review especially sensitive issues.And, most importantly, each entity involved in the budget process must perform its own role in a responsible fashion, and be given the means and capacity to do so. c. Reaching out The importance of listening Consultations can strengthen legislative scrutiny of government strategy and the budget. Legislative hearings through committees and subcommittees, particularly outside the pressure environment of the annual budget, can provide an effective mechanism for consulting widely on the appropriateness of policies (issues related to the role of the legislature are discussed in chapter 5) .The government should try to get feedb