Administrative Culture Halduskultuur. Administrativna® kul Ýtu ra.Verwaltungskultur. Hallintokulttuuri vol. 19 no. 1 Ragnar Nurkse Department of Innovation and Governance Tallinn University of Technology 2018 Administrative Culture Established in 1999 EditOR-in-CHieF: Wolfgang Drechsler, Tallinn University of Technology EditOriaL BOard: Marleen Brans, Catholic University of Leuven Veiko Lember, Tallinn University of Technology Tiina Randma-Liiv, Tallinn University of Technology Eugenie Samier, University of Strathclyde MANAGING EDITOR: Shobhit Shakya, Tallinn University of Technology AdvisORY BOard: Pertti Ahonen, University of Helsinki; Jörg Bogumil, Ruhr-University Bochum; Geert Bouckaert, Catholic University of Leuven; Fenwick W. English, University of North Carolina at Chapel Hill; Agustin Ferraro, University of Salamanca; György Jenei, Corvinus University of Budapest; Christoph Knill, University of Munich; Vitalis Nakrošis, University of Vilnius; Edoardo Ongaro, The Open University, UK; Janine O'Flynn, University of Melbourne; B. Guy Peters, University of Pittsburgh; Martin Potu° ček, Charles University in Prague; Isabella Proeller, University of Potsdam; Harald Sætren, University of Bergen; Markku Temmes, University of Helsinki; Baldur Thorhallsson, University of Iceland; Frédéric Varone, University of Geneva; Mirko Vintar, University of Ljubljana COntact: Shobhit Shakya, Ragnar Nurkse Department of Innovation and Governance, Tallinn University of Technology, Akadeemia tee 3, 12618 Tallinn, Estonia, [email protected] ELECTRONIC ACCESS: www.halduskultuur.eu SubmissiOns: Submissions will be peer-reviewed anonymously. Manuscripts should be uploaded electroni- cally via http://halduskultuur.eu/submit.html The journal follows the Harvard Manual of Style. For sample notes, see www.halduskultuur.eu The journal is published twice per year. Full text available in EBSCO, Central and Eastern European Online Library and Google Books online databases. Abstracted in EBSCO Public Administration Abstracts, PA@BABEL (Public Administration's dataBase for Accessing aca- demic puBlications in European Languages), Scopus, Social Services Abstracts, Sociological Abstracts, and Worldwide Political Science Abstracts. Language editing by Ingbert Edenhofer Graphic design by Killu Sukmit Cover vignette by Marco Laimre based on drawings by Franz Kafka ISSN 1736-6070 (print) ISSN 1736-6089 (online) Printed by Vali Press © Ragnar Nurkse Department of Innovation and Governance, Tallinn University of Technology, 2018 Contents Ringa Raudla, Lars Mjøset, Rainer Kattel, Aleksandrs Cepilovs, Olga Mikheeva and Bent Sofus Tranøy Different Faces of Fiscal Bureaucracy 5 Arto Haveri, Henna Paananen and Jenni Airaksinen Narratives on Complexity: Interpretations on Local Government Leadership Change 37 Danica Fink-Hafner and Damjan Lajh Politico-Administrative Relations in the National Reception of OMC Policies: Comparing Policy Sectors in Slovenia 55 Rainer Kattel, Aleksandrs Cepilovs, Veiko Lember and Piret Tõnurist Indicators for Public Sector Innovations: Theoretical Frameworks and Practical Applications 77 Bonn Juego Authoritarian Neoliberalism: Its Ideological Antecedents and Policy Manifestations from Carl Schmitt’s Political Economy of Governance 105 Book review Rainer Kattel Edoardo Ongaro (2017) Philosophy and Public Administration: An Intro- duction 137 Ringa Raudla, Lars Mjøset, Rainer Kattel, Aleksandrs Cepilovs, Olga Mikheeva and Bent Sofus Tranøy. 2018. “Different Faces of Fiscal Bureaucracy.” Administrative Culture 19 (1), 5-36. Different Faces of Fiscal Bureaucracy Ringa Raudla, Lars Mjøset, Rainer Kattel, Aleksandrs Cepilovs, Olga Mikheeva and Bent Sofus Tranøy ABSTRACT In light of the growing importance of finance ministries and the financial dimension in policy-making, opening up the “black box” of fiscal bureaucracies is more war- ranted than ever. Our paper addresses the following research question: What kinds of roles can be assumed by fiscal bureaucrats in fiscal policy-making and budget- ing? We propose four dichotomies that can be employed for examining the roles played by fiscal bureaucracies: 1) developers vs guardians; 2) initiators vs followers; 3) mediators vs insulators; 4) modellers vs estimators. In developing these dimen- sions, we juxtaposed the insights from various streams of institutionalist research and also literature on public budgeting and public policy with the themes that emerged from the interviews we conducted in four different countries: Estonia, Latvia, Sweden and Norway. We find that fiscal bureaucracies in Estonia and Latvia tend to be closer to the guardian-insulator-estimator ends of the continuums, where- as the officials in Sweden and especially Norway lean towards the developer-medi- ator-modeller end of the scale. The division between the initiator vs follower roles is less clear-cut. Keywords: fiscal bureaucracy, fiscal policy, budgeting, comparative analysis 1. Introduction A number of studies on fiscal governance have pointed to the increasing power of the finance ministries, following the recent financial, economic and fiscal crises (Allen et al. 2016; Di Mascio et al. 2013; Raudla et al. 2015). Finance ministries have already tended to be primi inter pares among the ministries since they are respon- sible for “formulating and implementing the core financial functions of govern- ment” and are “at the center of economic and fiscal policy-making” (Allen et al. 2016, 3). The growing importance of the financial dimension in governance gives the finance ministries – and especially the “fiscal bureaucracy” part – an even big- ger role in the governmental ecosystem. By “fiscal bureaucracy” we mean the civil 5 Different Faces of Fiscal Bureaucracy servants who are involved in and contribute to budgetary and fiscal policy; hence, it covers officials working for the departments of budgeting, fiscal policy and macro- economic analysis in the finance ministries. In light of their growing importance, it is somewhat curious that the finance ministries have received only limited attention in scholarly research so far. Indeed, as Allen et al. (2016, 4) put it, “the literature on the functions and organizational structure of finance ministries is relatively slim”. However, anecdotally, the power and importance of fiscal bureaucrats is rarely doubted, often feared and vilified as in this following exchange from Yes, Prime Minister (1986): James Hacker: But that’s an outrageous view. Sir Humphrey Appleby: Yes indeed, it’s known as Treasury Policy. Thus, it comes as a surprise that the role of bureaucracy in policy-making is an understudied question – or even a “missing variable” (Meier 2009, 7) – even though it is often admitted that bureaucrats can play a significant role in policy making (Baekgaard et al. 2015; Howlett 2011). If the volume of studies on finance ministries and the role of bureaucracies in policy-making is “slim”, the literature on fiscal bureaucracies is even thinner. In Krause’s (2012, 149) words: “Budget officials are bureaucrats but bureaucracy is mostly absent from literature on bud- geting.” Given their increased power and relevance, however, it would be useful to open up the “black box” of fiscal bureaucracies and take a closer look at the kinds of roles they play and the types of “faces” they can have. In doing that, we have followed the call of Yesilkagit (2012, 35), who, when elaborating the future research agenda in the field of executive politics, called for “recalibrating” the images we have of bureaucracies by undertaking more studies about the bureau- crats’ roles, beliefs and perceptions. Thus, the research question this paper addresses is: What kinds of roles can be assumed by fiscal bureaucrats in fiscal policy-making and budgeting? While Allen et al. (2016) analyze the functions and organization of finance ministries as a whole, in this paper, we zoom in closer on the fiscal bureaucracy part of finance ministries. We propose four dichotomies that can be employed for examining the roles played by fiscal bureaucracies: 1) developers vs guardians; 2) initiators vs followers; 3) media- tors vs insulators; 4) modellers vs estimators. In developing these dimensions, we juxtaposed the insights from various streams of institutionalist research and also on literature on public budgeting and public policy with the themes that emerged from the interviews we conducted in four different countries: Estonia, Latvia, Sweden and Norway. In each country, 5-6 semi-structured interviews were conducted with fiscal bureaucrats during the period of 2014-2016. In choosing the interviewees we fol- lowed the logic of purposive sample and sought to cover officials who contribute to fiscal policy making and budgeting through different angles. The dichotomies we outline in this paper are, of course, continuums rather than binary in nature. For developing the first three dichotomies (developers vs guardians; initiators vs follow- ers; mediators vs insulators) we were able to draw on the theoretical discussions in the existing literature. The last dichotomy (modeller vs estimator) emerged as an insight from our interviewees. It also points to a gap in the existing theoretical dis- 6 Ringa Raudla, Lars Mjøset, Rainer Kattel, Aleksandrs Cepilovs, Olga Mikheeva and Bent Sofus Tranøy cussions on comparative public policy and bureaucracy – since we could not find any studies that would discuss the use of macroeconomic models by fiscal bureaucracies. In choosing the countries, our goal was to cover a sufficient