Interdisciplinary Description of Complex Systems 12(1), 61-77,

Interdisciplinary Description of Complex Systems 12(1), 61-77,
2014
IMPACT OF STRATEGIC PLANNING ON
MANAGEMENT OF PUBLIC ORGANIZATIONS IN
BOSNIA AND HERZEGOVINA
Ismet Salkic*
Faculty of Political Science - University of Sarajevo
Sarajevo, Bosnia and Herzegovina
DOI: 10.7906/indecs.12.1.4 Received: 24. December 2013.
Regular article Accepted: 21. January 2014.
ABSTRACT
Modem public organizations should be familiar with the internal
and external factors that
affect their business. Striking a balance between these factors is
the main prerequisite for
building a successful business model in the current conditions
of rapid change and increased
competition. The aim of this study is to determine the impact of
strategic planning on
management of public organizations. An empirical research was
conducted in public
organizations in Bosnia and Herzegovina. The results of the
research indicate that the use of
strategic planning in public organizations enables more rational,
efficient and effective

management of organizational resources. Strategic plarming
defines certain aspects of the
performance measurement, which reduces the possibility that
managers allocate resources on
the basis of their subjective preferences or feelings, ambitions
or as some kind of response to
certain political pressures. This contributes to a transparent,
rational, more efficient and
effective management of the organization in providing quality
public services.
KEY WORDS
strategic management, strategic planning, public organization,
management
CLASSIFICATION
JEL: HI
•Corresponding author, ;;: [email protected]; +387 33 203 562;
Faculty of Political Science, Skenderija 72, 71 000 Sarajevo,
Bosnia and Herzegovina
I. Salkic
INTRODUCTION
Strategic planning is a way and approach to the work of public
organizations which has been
successfully applied in a private sector for a long time. In this
way, public organizations can
make timely decisions, with an aim to manage limited resources
in a more rational manner, to
increase and improve services and achieve a greater satisfaction

of citizens and business entities.
Public organizations serve social interest, i.e. provide public
services with an aim to meet the
interests and needs of citizens and business entities. Until
recently public organizations were
poorly organized and their operations have been developed in an
unstructured manner,
without any serious plans. That resulted in inefficiency and
ineffectiveness, which ultimately
led to a decline in the quality of public services and i ncreased
dissatisfaction of all
stakeholders. That very modus operandi of public organizations
has long-term consequences,
because public organizations create environment for the
development of economy and create
ambiance for social entrepreneurship, as a special aspect of
strategic entrepreneurship.
Accordingly, public organizations have a great social
responsibility and implications on the
economic development of a certain country.
Strategic planning is a concept that has already shown
remarkable results in market
operations. Today, it is almost impossible to find a serious
profit organization which does not
apply the methods and approaches of strategic planning in their
business. Organizations that
have a clearly defined concept of strategic planning are more
likely to achieve their goals.
Organizations that do not apply strategic plarming in their
business have little chance of
survival in the market. A formulated strategy takes into accotmt
the external factors that have
a significant impact on the organization, analyses the internal
strengths and weaknesses of the

organization, defines the organization's goals and ways to
achieve the set goals, the strategy
implementation method, as well as the means for the
measurement and evaluation of the
implementation of goals. It is very difficult for an organization
which does not apply strategic
planning to measure a degree of implementation of the goals as
well as work efficiency. Such
organizations run their business in an unstructured manner,
without serious plans and that
often leads to high costs and produces very little results.
In Bosnia and Herzegovina, as well as in other transition
cotmtries, the importance of
strategic planning in public organizations is still not sufficiently
studied. A great number of
public organizations in Bosnia and Herzegovina do not have
sufficient knowledge, culture
and routine to strategically plan their activities. The
consequences of such a situation are
extremely negative. This is the reason why these problems
should be consistently researched,
identified and properly addressed, because they imply and
multiply many adverse
consequences for B&H society and economy.
LITERATURE REVIEW
Dooris, Kelley and coach believe that strategic planning is still
a relatively new concept in
management. These authors have identified the period between
the 1950s and 1970s, as the
time when strategic planning emerged. They find that the last
several decades have been a
boom period for strategic planning [1; p.6]. When strategic
planning gained popularity,
researchers have begun paying more attention to the definition

of strategic planning. Bryson
defines strategic planning as "a disciplined effort to produce
fundamental decisions and actions
that shape and guide what an organization is, what it does, and
why it does it" [2; p.6].
Mintzberg says that the concept of fomialization is a key to
understand planning. He defines
strategic planning as "formalized procedure to produce
articulated result, in the form of an
integrated system of decision" [3; p. 12]. Wilkinson and
Monkhouse define strategic planning
62
Impact of strategic planning on management of public
organizations in Bosnia and Herzegovina
as "a method used to position an organization, through
prioritizing its use of resources
according to identified goals, in an effort to guide its direction
and development over a period
of time" [4; p. 16]. Sehic defines strategic planning as "making
present decisions in the light
of their future implementation" [5; p.27]. Kotier defines
strategic planning as „the process of
developing and maintaining a strategic fit between the
organization's goals and capabilities
and its changing marketing [6; p.44]. Strategic planning in
public organizations has a task to
analyze external factors infiuencing their operations, perceive
internal strengths and
weaknesses and, on that basis, set organizational goals and
takes all necessary measures in
order to achieve planned goals.

Many authors [7] believe that application of strategic platming
can bring many benefits to an
organization, such as: development of mission and vision of the
organization, adjustment to
the surroundings and achievement of set goals. Strategic
planning in public organizations
includes variety of activities, such as: setting organizational
goals, defining tasks, establishing
internal and external tasks and task forces, identifying key
issues, developing strategies for
each particular issue, planning control and adopting of
procedures, planning adoption and
producing fundamental decisions, taking actions, constant
control and communication of
results [7]. Bryson lists five benefits of strategic planning in the
public and non-profit
organizations: 1) promotion of strategic thinking and action, 2)
improvement of a decision
making process 3) improvement of organization, 4)
improvement of the overall organization
of work and results within an organization and 5) strategic
planning can directly benefit all
employees within the organization [7; p.5].
Strategic planning focuses attention on the important issues and
challenges in organizational
forms and helps key decision-makers to find the ways to address
them. Strategic planning
can, therefore, help organizations to define their strategic goals
and to make today's decisions
in the light of their future consequences. Organizations that use
strategic planning pay more
attention to major organizational issues and are prepared to
respond to internal and external
demands and pressures, efficiently dealing with the

consequences of all changes. Strategic
planning can directly benefit employees of an organisation,
enabling those who create
policies and make key decisions to work more effectively and
fulfil their obligations. It can
also help them build teamwork and expertise. [7].
The process of implementation of the strategy involves defining
specific requirements which
an organization needs to fulfil in order to achieve the expected
effects. We can say that the
strategy entails the use and development of certain resources,
abilities and skills, in order to
enforce the implementation process. Organizational structure of
a company defines the
manner, structure, distribution and model of the management of
tangible and intangible assets
of a company [8; p.4O].
There is a large degree of agreement in theoretical works that
managers have a very
important role in the planning process. The literature states that
managers are very important
part of the planning process, i.e. that people are the most
important factor for successful
implementation of strategic planning [9-12]. Streib [12]
acknowledges that it is difficult to
define the components of a successful strategic effort, but he
identifies four management
functions that he finds critical to the success of any strategic
planning effort: leadership,
human resources, managerial skills, and external support. The
importance of people in the
strategic planning process is evident in the fact that three of the
four critical functions
specifically address people and their role in planning. Eadie

states the importance of people
to the planning process by writing "the human factor looms
large in strategy implementation,
as well as in formulation and selection of strategies". [11;
p.448]. Hosmer describes strategic
planning as an organizational task. She writes "Strategic
management is an organizational
63
I. Salkic
task and requires an integrated effort by all members of the
organization for successful
completion" [13; p.55]. Bloom (1986) states that "the failure to
involve interested parties in
the planning process can reduce the chances for
implementation" [10; p.254].
Lorange and Vancil [14] draw attention to the specific role of
corporate planners and suggest
that planning must be done by line managers because it is likely
to be successftil if it is not
the work of just one person, but a people-interactive process
involving all employees. The
authors acknowledge the need for corporate planners, but view
the corporate planner as an
organizer who facilitates the process of planning. Bryson and
Roering [15] acknowledge a
similar role that they refer to as a manager. In their study of
strategic planning in government,
they identify the need that a manager is present everywhere in
the process, in order to
implement strategic planning.

Leadership has been identified as critical to the planning
process because it is important for
balancing the internal and external forces that affect the
organization [9, 16]. Additionally, an
active leader builds managerial support for the planning process
which results in greater
support for implementation of the plan [10]. Hosmer [13]
clearly identifies the critical
importance of leadership to the planning process. Leadership is
important; it is not an
outdated concept. There is a need for leaders. Much of the
literature agrees that strong
leadership committed to strategic planning is important for
successful implementation of the
plan. If the leader makes strategic planning a priority, which
means that the organisation
considers strategic planning as priority. The challenge,
however, comes from the idea that the
people in the organization are more likely to be accountable for
the plan if they are involved
in the development of the plan. This, intuitively, is very easy to
comprehend. In practice,
however, it is more difficult because the strong leader, the only
person planning the process,
may also be the leader who does not like to relinquish control of
the process. With
participation and involvement of other employees in the
planning process, the leader
necessarily loses some control. As a result, the strong
leadership that the literature calls for
and the participatory process for all employees can make
implementing the strategic plan a
difficult challenge. In addition to this challenge, the literature
acknowledges that people play
an important role in the planning process for strategic planning

to be effective. Organizations
must ensure participation and support of leaders and employees
who will implement the plan.
Streib [12] after identifying the importance of leadership to the
strategic planning process
questions whether the public sector possesses the level of
leadership necessary to succeed.
Difficulties arise in maintaining a shared vision among elected
and appointed officials, who
change frequently due to elections and staff changes. Streib and
Poister [17] discuss public
sector limitation in terms of strategic capacity and question
whether public organizations are
able to compile the information necessary for the completion of
a strategic plan. While
continuity of leadership certainly can help an organization
maintain a consistent vision which
would, in turn, help the strategic planning process, one could
argue that the author's
questioning of leadership and strategic capacity within public
organizations is too general and
fails to acknowledge individual levels of leadership and
strategic capacity. It is safe to
assume that just as there are strong and weak leaders in the
private sector, there are also
strong and weak leaders of public organizations.
M E T H O D O L O G Y
RESEARCH APPROACH
The subject of this study is to analyze the connection between
strategic planning and
responsible management of public organizations in Bosnia and
Herzegovina. Public

64
organizations include public administration bodies, public
institutions and public companies.
Based on the subject, the objective of the research is defined
and that is to determine how and
in what way strategic planning leads to a more responsible
management of public organizations
in Bosnia and Herzegovina. It will be examined to what extent
the application of strategic
management in public organizations in Bosnia and Herzegovina
enables the creation of an
efficient strategic planning process, with a clear and distinctive
strategy that the organization
follows, a more effective development and implementation of
business plans, planning and
performance measurement. This will contribute to a transparent,
rational, efficient and
effective management of the organization whilst providing
better quality pubhc services.
In public organizations' practice, it is important to ensure
objectivity of managers, which
directly affects the success of organizational performance. To
further support this practice, it
will be investigated to what extent the application of strategic
planning in public
organizations affects their managers' objectivity in allocating
resources.

Based on the defined problem, the subject and the research
questions, the research hypothesis
has been formulated: strategic planning in public organizations
defines certain aspects of
performance measurement, reduces the possibility that managers
allocate resources guided by
their subjective assessments and feelings, personal ambition or
as some kind of response to
certain political pressures.
In order to achieve the stated objectives of the study and
examine the above hypothesis, a
survey was conducted on a selected sample of public
organizations.
RESEARCH DESIGN
Research design defines the characteristics of this research that
follow. The survey research
for this study has exploratory and explanatory character,
stemming from the collection of data
on strategic planning in public organizations and the analysis of
the impact of strategic
planning on a number of indicators of public organizations'
performance. The method of
online interviewing was selected and conducted in a cross-
sectional survey, thus enabling the
collection of data from a greater number of public organizations
in a given time and space.
The questionnaires were sent to the respondents - top managers
of public organizations
(directors, managers, administrators, ministers, mayors),
selected for the sample. The
questionnaire was sent directly to the respondents via e-mail,
using a special application to

collect responses (www.SurveyConsole.com).
SURVEY INSTRUMENTATION
Strategic planning was analyzed in the sample, with a separate
analyzes of the "function of
institutional planning" in the sample (4 items, A1-A4),
"existence of a strategic
base/framework" in the sample (4 items, B1-B4), as well as
"strategic planning development
team optimization" in the sample (4 units, F1-F4). Development
of the functions of
institutional planning in the sample investigated using 4 items,
wherein the respondents
expressed the extent to which they agree with the statements
(items G1-G4). Cronabach's
alpha was calculated to test the reliability of the used scales.
SURVEY SAMPLE
The study population was as follows: in Bosnia and
Herzegovina there are 200 organizations
belonging to public administration, 500 organizations that are
organized as public institutions
and 100 public companies in which the state holds a majority
stake (the state is the owner). It
can be concluded that in Bosnia and Herzegovina there are total
of 800 public organizations.
65
I. Salkic
of which 200 (25 %) are public institutions, 500 (62,5 %) are

public administration bodies
and 100 (12,5 %) are public companies. This study sample
included 200 public organizations.
The sample was proportionally stratified with proportions of
groups in the sample matching
the population proportions. In order to control the structure of
the sample, three strata were
used: public institutions, public administration organizations
and public enterprises. To select
the sampling units within each stratum, a random number
generator was used. The stratified
sample model of public organizations is based on a legal form
as the only criterion of
stratification, and is applied with roughly equal allocation of
sample units per strata. In this
way, the representation of the three types of public
organizations in this study is ensured. In
this study, the sample of 200 public organizations includes nl =
124 public administration
organizations, n2 = 47 public institutions and n3 = 18 public
companies. The sample consists
of 24,87 % public institutions, 65,61 % organizations of public
administration and 9,62 %
public companies. Chi-square test examined whether the
difference in the structure of public
organizations in the sample is significantly different from the
structure of public
organizations in the population. Chi-square test showed that the
difference was not
statistically significant (chi-square = 0,866, p-value = 0,648).
RESULTS
FUNCTION OF INSTITUTIONAL PLANNING IN THE
SAMPLE (A1-A4)

Table 1 shows the average values of units from Al to A4. Each
unit can be assigned a
numerical value on a scale of 1 to 5. The data in the table show
that unit Al has the highest
average value (3,97). It is followed by unit A4 with the average
value of 3,82. The third is
unit A3 (3,68), and the last, fourth, is unit A2 (3,64).
EXISTENCE OF A STRATEGIC BASE/FRAMEWORK IN THE
SAMPLE (B1-B4)
Table 2 shows the average values of units from B1 to B4. Each
that imit Bl has the highest
average value (4,14). It is followed by unit B3 with the average
value of 4,08. The third is
unit B4 (3,56), and the last, fourth, is unit B2 (3,43).
STRATEGIC PLANNING DEVELOPMENT TEAM
OPTIMIZATION IN
THE SAMPLE (F1-F4)
Table 3 shows the average values of units from Fl to F4. Each
that unit F2 has the highest
average value (3,44). It is followed by units Fl and F4 with the
average value of 3,55, and the
last, fourth, is unit F3 with the average value of 3,31.
Table 1. Average values of units Al-A4. Source: author's
research in November 2013.
Function of institutional planning
(A1-A4)
A l . In your organization, top management

takes care of strategic planning.
A2. Strategic planning in your
organization is a priority activity.
A3. The organization follows a deñned
set of procedures in strategic plarming.
A4. The organization ensures that all
managers participate in the planning
process.
N
191
185
184
186
Min
1
1
1
1
Max
5
5
5

5
Average
3,97
3,64
3,68
3,82
St. Dev.
1,06
1,08
1,02
1,09
66
Table 2. Average values of units B1-B4. Source: author's
Existence of a strategic base/ framework
(B1-B4)
B1. The organization has a clearly vmtten mission
statement.

B2. All employees and all levels of management in
the organization understand the mission.
B3, The organization has written short-term (1 year)
and long term (3-5 years) goals.
B4. The organization, as needed, defines the goals by
location or geograpbical area (municipalities, regions,...).
183
181
181
180
Min
1
1
1
1
Max
5
5
5
5
Average

4,14
3,43
4,08
3,56
St. Dev.
1,03
1,12
0,99
1,10
Table 3. Average values of units F1-F4. Source: author's
Strategic planning development team
optimization (F1-F4)
Fl. The organization makes sure to use the talents
and time of each individual board member.
F2. The organization ensures adequate involvement
of each strategic plan development team member.
F3. The organization takes care of the development
of new members of the strategic plan development
team.
F4. The strategic plan development team strives to
get all employees involved in the strategic planning
process.
N

187
190
185
184
Min
1
1
1
1
Max
5
5
5
5
Average
3,35
3,44
3,31

3,35
St. Dev.
1,11
1,10
1,16
1,18
SUBJECTIVITY AND OBJECTIVITY OF THE
MANAGEMENT IN
THE SAMPLE (G1-G4)
Table 4 shows the average value of units from GI to G4. Each
numerical value on a scale of 1 to 5. The data in the table s how
that units GI and G2 have the
highest average value (4.06). They are followed by unit G2 with
the average value of 3,84,
and the fourth is unit G4 with the average value of 3,50.
Table 4. Average values of units G1-G4. Source:
Subjectivity and objectivity of management, in
the sample (G1-G4)
GI. The organization manager ensures fulfilment
of organizational goals.
G2. The organization manager takes into account
the interests of the community.
G3. The organization manager makes decisions on
the basis of an objective assessment.
G4, The organization manager does not make
decisions under the influence of external factors.

author's
TV
189
183
184
181
researcl
Min
1
1
1
1
1 in November 2013.
Max
5
5
5
5

Average
4,06
4,06
3,84
3,50
St. Dev.
0,88
0,97
1,06
0,96
DISCUSSION
This section of the study will examine the first hypothesis (HI)
which assumes that strategic
planning in public organizations defines certain aspects of
performance measurement, thereby
reducing the possibility that managers allocate resources on the
basis of their subjective
assessments and feelings, personal ambitions or as some kind of
response to certain political
pressures. In doing so, strategic planning in public
organizations shall be measured by the
following constructs: "ftinction of institutional planning" (tmits
A1-A4, aggregate imit AM),
67

I. Salkic
"existence of a strategic base/framework" (units B1-B4,
aggregate unit BM) and "strategic
platming development team optimization" (units F1-F4,
aggregate unit FM).
To examine the hypotheses, the correlation and regression
method will be used, whereby the
following analysis will be conducted:
• 4 multiple linear regression analyses, using aggregate units as
independent variables: (1)
dependent variable: unit Gli independent variables: aggregate
units AM, BM and FM, (2)
dependent variable: unit G2i independent variables: aggregate
units AM, BM and FM, (3)
dependent variable: unit G3i independent variables: aggregate
units AM, BM and FM, and
(4) dependent variable: unit G4i independent variables:
aggregate units AM, BM and FM.
• 4 Stepwise multiple linear regression analyses using
individual units as independent
variables: (1) dependent variable: unit Gli independent
variables: units A1-A4, B1-B4 and
F1-F4, (2) dependent variable: unit G2i independent variables:
units A1-A4 , B1-B4 and
F1-F4, (3) dependent variable: unit G3i independent variables:
units A1-A4, B1-B4 and F1-F4
and (4) dependent variable: unit G4i independent variables:
units A1-A4, B1-B4 and F1-F4 .

Table 5 shows the regression model where the unit Gl
"organization manager ensures
fulfilment of organizational goals" is the dependent variable,
and the independent variables
are the average values of the units: "institutional planning
function (AM)", "existence of a
strategic base/framework" (BM) and "strategic planning
development team optimization" (FM).
The coefficient of determination is 0,555, meaning that 55,5 %
of the variations of the
dependent variable can be explained by the variations of the
independent variables. The
regression coefficients with all the independent variables are
positive and statistically
significant. It can be concluded that "development of
institutional planning function" (AM),
"existence of a strategic base/framework" (BM) and "strategic
planning development team
optimization" (FM) significantly infiuence whether an
organization manager ensures
fulfilment of organizational goals.
In order to investigate which individual units have statistically
significant infiuence on the
dependent variable Gl "the organization manager ensures the
fulfilment of organizational
goals" a stepwise regression analysis method was used. The
independent variables were the
units measuring the „function of institutional planning" (A1-
A4), "existence of a strategic
base/framework" (B1-B4) and "strategic planning development
team optimization" (F1-F4).
The stepwise regression analysis method was used with an aim
of finding such a reduced set
of independent variables, of the total number of candidate
independent variables, which

Tabie 5. The regression model - the dependent variable is unit
Gl: "the organization
manager ensures fulfilment of organizational goals"; the
independent variables are the
average values of the units: "institutional planning
function"(AM), "existence of a strategic
base/ framework"(BM) and "strategic planning development
team optimization" (FM).
Source: author's research in November 2013.
Independent variables
(Constant)
AM
BM
FM
R2 adjusted for the number of
independent variables
Regression model using all independent variables:
dependent variable is Gl
B
1,330
0,164
0,238
0,359
Std. Error
0.214
0,093
0,084
0,075

t
6,208
1,762
2,845
4,795
Sig.
0,000"
0,080'
0,005"
0,000"
0,555
"statistically significant at 1 % probability
'statistically significant at 10 % probability
68
Table 6. The regression model, using all variables, and a
reduced regression model (stepwise
regression) - the dependent variable is unit Gl: "the
organization manager ensures ftilfilment
of organizational goals"; the independent variables: units A1-
A4, B1-B4 and F1-F4. Source:
author's research in November 2013.
(Constant)

A2. Strategic planning in your organization is
a priority activity.
A4. The organization ensures that all
managers participate in the planning process.
B2. All employees and all levels of management
in the organization understand the mission.
B4. The organization, as needed, deñnes the
goals by location or geographical area
(municipalities, regions ...).
Fl. The organization makes sure to use the
talents and time of each individual board
member.
R2 adjusted for the number of independent
variables
Reduced model (stepwise regression)
dependent variable is Gl
B
1,471
0,129
0,159
0,309
0,151
1,471
Std. Error
0,186

0,048
0.067
0,061
0,057
0,186
t
7,903
2,706
2,369
5,098
2,660
7,903
Sig.
0,000"
0,008"
0,019*
0,000"
0,009"

0,000"
0,571
"statistically significant at 1 % probability,
maximizes the validity of the regression model. The coefficient
of the regression model,
using all the independent variables, is 0,571, meaning that 57,1
% ofthe variations ofthe
dependent variable can be explained by the variations of the
independent variables. The units
that statistically significantly influence the dependent variable
are shown in the table. It can
be concluded that the units: "strategic planning as a priorify
activity in an organization" (unit
Al), "all managers participate in the planning process" (unit
A2), "understanding of the
organization's mission by all employees and all levels of
management" (unit B2), "denning
goals by place or geographical area" (unit B4) and "use of
talents and time of each individual
board member" (unit Fl) significantly affect whether an
organization manager ensures the
fulfilment of organizational goals.
Table 7 shows the regression model where the dependent
variable is unit G2: "the
organization manager takes into account the interests of the
community" and the independent
variables are the average values of the units: "institutional
planning function" (AM),
optimization" (FM). The coefficient of determination is 0.601,

meaning that 60.1% ofthe
variations of the dependent variable can be explained by the
variations of the independent
variables. The regression coefficients, with all the independent
variables, are positive and
statistically significant. It can be concluded that the units:
"development of institutional
planning function" (AM), "existence of a strategic
base/framework" (BM) and "strategic
planning development team optimization" (FM) statistically
significantly affect whether an
organization manager takes into account the interests ofthe
community.
significant influence on the
dependent variable G2: "the organization manager takes into
account the interests of the
community", a stepwise regression analysis method was used,
taking as independent
variables the units measuring the "flinction of institutional
planning" (A1-A4), "existence of
a strategic base/framework" (BI-B4) and "strategic planning
development team optimization"
69
I. Salkic
Tabie 7. The regression model - the dependent variable is unit
G2: "the organization
manager takes into account the interests of the community"; the
independent variables are the
average values of the units: "institutional planning ñinction"

(AM), "existence of a strategic
base/framework" (BM) and "strategic planning development
team optimization" (FM).
Source: author's research in November 2013.
(Constant)
AM
BM
FM
Regression model using all independent variables:
dependent variable is G2
B
0.917
0,411
0,213
0,234
Std. Error
0,219
0,096
0,086
0,077
t
4,181
4,306
2,494
3,053
Sig.

0,000"
0,000"
0,014"
0,003""
0,601
""statistically significant at 1 % probability,
'statistically significant at 5% probability
(F1-F4). The stepwise regression analysis method is used with
an aim of finding such a
reduced set of independent variables, of the total number of
candidate independent variables,
whieh maximizes the validity of the regression model. The
coefficient of the regression
model, using all the independent variables, is 0,612, meaning
that 61,2 % of the variations of
the dependent variable can be explained by the variations of the
independent variables. The
units that significantly infiuence the dependent variable are
shown in the table. It can be
concluded that "strategic plaiming as a priority activity in an
organization" (unit Al), "use of
a defined set of procedures in strategic planning" (unit A3),
"written short and long term
goals" (unit B3), "use of time and talents of each individual
board member" (unit Fl) but also
"of each team member" (unit F2) statistically significantly
influence whether an organization
manager takes into account the interests of the community.
Table 8. The regression model using all variables and a reduced
regression model (stepwise
regression) - the dependent variable is unit G2: "the
organization manager takes into account

the interests of the community"; the independent variables are
units: A1-A4, B1-B4 and
F1-F4. author's research in November 2013.
(Constant)
A l . The top management takes care of strategic
planning in your organization.
A3. The organization follows a deñned set of
procedures in strategic planning.
B3. The organization has written short-term (one
year) and long term (3-5 years) goals.
Fl. The organization makes sure to use the talents
and time of each individual board member.
F2. The organization ensures adequate
involvement of each strategic plan development
team member.
R2 adjusted for the number of independent variables
Reduced model (Stepwise regression):
B
1,037
0,173
0,146
0,124
0,124
0,282

Std. Error
0,206
0,075
0,082
0,059
0,049
0,063
t
5,031
2,311
1,769
2,101
2,531
4,450
Sig.
0,000"""
0,022"
0.079"
0.037"

0,012""
0,000"""
0,612
"""statistically significant at 1 % probability,
70
variable is the unit "organization
manager makes decisions on the basis of an objective
assessment", and the independent
planning fiinction" (AM),
optimization" (FM). The coefficient of determination is 0,522,
meaning that 52,2 % of the
statistically significant. It can be concluded that the functions
"development of institutional
planning"(AM), "existence of a strategic base/framework" (BM)
and „strategic planning
development team optimization" (FM) significantly affect

whether an organization manager
makes decisions on the basis of an objective assessment.
significant influence on the
dependent variable G3: "the organization manager makes
decisions on the basis of an
objective assessment", the stepwise regression analysis method
was used, taking as
independent variables the units measuring the "function of
institutional planning" (A1-A4),
"existence of a strategic base/framework" (B1-B4) and
"strategic planning development team
optimization" (F1-F4). The stepwise regression analysis method
is used with the aim of
finding such a reduced set of independent variables, of the total
number of candidate
independent variables, which maximizes the validity of the
regression model. The coefficient
of the regression model, using all independent variables, is
0,517, meaning that 51,7 % of the
variables. The units that statistically significantly influence the
dependent variable are shown
in the table. It can be concluded that the units: "strategic
plarming as a priority activity in an
organization" (unit Al), "defining goals by place or
geographical area"(unit B4) and "use of
talents and time of each individual board member" (unit Fl)
statistically significantly influence
whether an organization manager makes decisions on the basis
of an objective assessment.
variable is unit G4: "the

organization manager does not make decisions under the
influence of external factors", and
the independent variables are the average values of the units:
"institutional planning function"
(AM), "existence of a strategic base/framework" (BM) and
"strategic plarming development
team optimization" (FM). The coefficient of determination is
0,222, meaning that 22,2 % of
the variations of the dependent variable can be explained by the
Table 9. The regression model - the dependent variable is unit
manager makes decisions on the basis of an objective
assessment"; the independent variables
are the average values of the units: "institutional planning
function" (AM), "existence of a
strategic base/framework"(BM) and "strategic planning
development team optimization"
(FM). Source: author's research in November 2013.
(Constant)
AM
BM
FM
Regression model using all the independent variables:
B

0.771
0,235
0,225
0.397
Std. Error
0.260
0,113
0,101
0,091
t
2,966
2,078
2,220
4,378
Sig.
0.003"
0,039'
0,028'
0,000"
0,522
"statistically significant at 1 % probability,
71
I. Salkic
Table 10. The regression model using all variables and a

organization manager makes decisions
on the basis of an objective assessment"; the independent
variables are units A1-A4, B1-B4
and F1-F4. Source: author's research in November 2013.
(Constant)
A l . The top management takes care of strategic
planning in your organization.
B4, The organization, as needed, defines the
goals by location or geographical area
(municipalities, regions ..,).
F l . The organization makes sure to use the
talents and time of each individual board
member.
variables
Reduced model (stepwise regression):
B
0,872
0,248
0,171
0,412
Std. Error
0,247

0,072
0,057
0,070
t
3,529
3,470
2,968
5,895
Sig.
0,001*
0,001*
0,003*
0,000*
0,517
*statistically significant at 1 % probability
Table 11. The regression model - the dependent variable is unit
manager does not make decisions under the infiuence of
external factors"; the independent

planning function" (AM),
optimization" (FM). Source: author's research in November
2013.
(Constant)
AM
BM
FM
Regression model using ail
B
1,793
0,117
0,044
0.328
Std. Error
0,304
0,132
0,118
0,106
independent
t
0,117
0,039

0,357
variables:
Sig.
0,000*
0,376
0,710
0,002*
0,222
*statistically significant at 1 % probability
Statistically significant. It can be concluded that development
of "institutional planning
function" (AM), "existence of a strategic base/framework" (BM)
and "strategic planning
development team optimization" (FM) statistically significantly
infiuence whether an
organization manager makes decisions under the infiuence of
external factors.
significant infiuence on the
dependent variable G4: "the organization manager does not
make decisions under the
infiuence of external factors" a stepwise regression analysis
method was used, taking as
independent variables the units which measure "function of
institutional planning" (A1-A4),
"existence of a strategic base/framework" (B1-B4) and
"strategic planning development team
optimization" (F1-F4). The stepwise regression analysis method
is used with the aim of
finding such a reduced set of independent variables, of the total

number of candidate
independent variables, which maximizes the validity of the
regression model. The coefficient
of the regression model, using all independent variables, is
0,282, meaning that 28,2 % of the
variables. The units that significantly infiuence the dependent
variable are shown in the table.
It can be concluded that a "clearly written mission statement of
the organization" (unit BI),
72
Impact of strategic planning on management ofpubiic
Table 12. The regression model using all variables and a
organization manager does not make
decisions under the infiuence of external factors", the
independent variables are units A1-A4,
B1-B4 and F1-F4. Source: author's research in November 2013.
(Constant)
B1. The organization has a clearly written
mission statement.
B2. All employees and all levels of management
in the organization understand the mission.
B3. The organization has written short-term
(one year) and long term (3-5 years) goals.

Fl. The organization makes sure to use the
talents and time of each individual board member.
variables
Reduced model (stepwise regression):
Dependent variable G4
B
1,950
-0,278
0,255
0,184
0,324
Std. Error
0,287
0,099
0,085
0,089
0,075
t
6,803

-2,806
2,980
2,058
4,345
Sig.
0,000"
0,006"
0,003"
0,041'
0,000"
0,282
"statistically significant at I % probability,
"understanding of the mission by all employees and all levels of
management" (unit B2),
"written form of short-term and long-term goals" (unit B3) and
"use of talents and time of
each individual board member" (unit Fl) significantly affect
whether an organization
manager makes decisions under the infiuence of external
factors.
To test the hypothesis (HI) of this study, the results of the
conducted correlation and

regression analyzes shall be summarized.
Table 13 shows the determination coefficients and regression
coefficients of the individual
independent variables of the regression models, with dependent
variables of units G1-G4, the
average values of the independent variables of units:
"institutional planning function"(AM),
optimization" (FM). It can be noted that all the aggregate
independent variables are
statistically significant in all the regression models. Also, the
determination coefficients,
adjusted for the number of independent variables, were high for
the regression models with
dependent variables of units Gl, G2 and G3, with an exception
of the determination
coefficient of the regression model with the dependent variable
G4. This result is consistent
with the results of the correlation analysis presented in the
preceding table. The regression
analysis suggests that there is a statistically significant
relationship between strategic
planning and subjectivity/ objectivity in managing
organizations.
Table 14 shows the determination and regression coefficients of
individual regression
models, using as dependent variables the units G1-G4, and as
independent variables the units:
"function of institutional planning" (A1-A4), "existence of a
strategic base/framework"
(B1-B4) and "strategic planning development team
optimization" (F1-F4). This analysis was
conducted to detennine which specific aspects of the functions

"institutional planning",
"existence of a strategic base/framework" and "strategic
optimization" have the greatest impact on the objectivity of
managers in public organizations.
It turned out that only the units F3 and F4 do not have
statistically significant infiuence on
dependent variables. The stepwise regression analysis leads to a
conclusion that there is a
statistically significant relationship between strategic planning
and subjectivity/objectivity in
managing organizations.
73
I. Salkic
Table 13. The determination coefficient and the regression
coefficients of individual
regression models; the dependent variables: units G1-G4, the
independent variables: average
values of the units "institutional planning function" (AM),
"existence of a strategic base/
framework" (BM) and "strategic planning development team
optimization" (FM). Source:
author's research in November 2013.
(Constant)
Function of institutional
planning AM
Existence of a strategic
base/ fî amework BM

Strategic planning
development team
optimization
R2 adjusted for the number
of independent variables
Regression models: dependent variables
G l . T h e
organization
manager
ensures the
fulfllment of
organizational
goals.
1,330*"
0,164*
0,238***
0,359***
0,555
G2. The
organization
manager takes
into account
the interests of
the communit}'.
0,917***
0,411*"

0,213**
0,234***
0,601
G3. The
organization
manager makes
decisions on the
basis of an
objective
assessment.
0,771*"
0,235"
0,225**
0,397*"
0,522
G4. The
organization
managerdoes
not make
decisions under
the influence of
external factors
1,793*"
0,117

0,044
0,328***
0,222
'''statistically significant at 1 % probability,
Based on the presented analyses, it can be concluded that the
research hypothesis (HI) that
"strategic planning in public organizations defines certain
aspects of performance
measurement, thereby reducing the possibility that managers
allocate resources on the basis
of their subjective assessments and feelings, personal ambitions
or as some kind of response
to certain political pressures", can be accepted.
CONCLUSION
The aim of this study was to analyze the importance of strategic
planning to responsible
management of public organizations. The conducted study
confirmed that application of
strategic planning in public organizations in B&H helps
managers to manage public
organizations in a more responsible manner. Based on the
results of the empirical study, we
can conclude that the research hypothesis (HI) that "strategic
planning in public organizations
defines certain aspects of performance measurement, thereby
reducing the possibility that
managers allocate resources on the basis of their subjective
assessments and feelings, personal
ambitions or as some kind of response to certain political
pressures", can be accepted.

These results suggest that state/public organizations should pay
more attention to the
implementation of strategic management, i.e. strategic planning,
strategy implementation and
control of activities of public organizations, as that will
increase the work efficiency and
improve the quality of public services delivery.
Table 14. (Next page) The determination and regression
coefficients of individual regression
models: the dependent variables are units G1-G4, the
independent variables are units:
"institutional planning function" (A1-A4), "existence of a
strategic base/framework" (B1-B4)
and "strategic planning development team optimization" (F1-
F4). Source: author's research
in November 2013.
74
( Constant )
Al Top management takes care of
strategic planning in your
organization.
A2. Strategic planning in your
organization is a priority activity.
A3. The organization follows a

defined set of procedures in
strategic planning.
A4. The organization ensures that
all managers are involved in the
planning process.
BI. The organization has a clearly
written mission statement.
B2. All employees and all levels of
management in the organization
understand the mission.
B3. The organization has wntten
short-term (one year) and long
term (3-5 years) goals.
B4. The organization, as needed,
defines the goals hy location or
geographical area (municipalities,
regions ...).
Fl. The organization takes eare to
use the talent and time of each
individual board member.
F2. The organization ensures
adequate involvement of each
strategic plan development team
member.
F3. The organization takes care of
the development of new members of
the Strategie plan development team.
F4. The strategic plan
development team strives to get
all employees involved in the
strategic planning process.
Reduced model (stepwise regression): dependent variables
Gl. The

organization
manager
ensures the
fulfilment of
organization
al goals.
1,471""
-
0,129""
-
0,159"
-
0,309"""
-
0,151""
1,471""
-
-
-
0,571
G2. The

organization
manager takes
into account the
interests of the
community.
1,037""
0,173""
-
0,146"
-
-
-
0,124"
-
0,124"
0,282""
-
-
0,612
G3. The
organization

manager
makes
decisions on
the basis of
an objective
assessment.
0,872"""
0,248""
-
-
-
-
-
-
0,171""
0,412""
-
-
-
0,517
G4. The

organization
manager does
not make
decisions
under the
influence of
external
factors.
1,950""
-
-
-
-
-0,278"""
0,255"""
0,184"
-
0,324"""
-
-
-
0,282

' statistically significant at I % probability,
75
I. Salkic
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http://dx.doi.Org/10.1287/mnsc.24.9.934,
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http://dx.doi.org/10.1177/027507409002000103.
76
UTJECAJ STRATESKOG PLANIRANJA NA UPRAVLJANJE
JAVNIM ORGANIZACIJAMA U BOSNII HERCEGOVINI
I. Salkic
Fakultet politickih nauka, Univerzitet u Sarajevu

Sarajevo, Bosna i Hercegovina
SAZETAK
Suvremene javne organizacije u svom poslovanju trebaju
poznavati unutamje i vanjske faktore koji utjecu na
njihovo poslovanje. Uspostava ravnoteze izmedu ovih faktora
osnovna je pretpostavka izgradnje uspjesnog
koncepta poslovanja u danasnjim uvjetima brzih promjena i
povecane konkurencije, Cilj ovog rada je utvrditi
kakav je utjecaj strateskog planiranja na upravljanje javnim
organizacijama. Provedeno je empirijsko
istrazivanje u javnim organizacijama u Bosni i Hercegovini.
Rezultati istrazivanja pokazuju kako primjena
strateskog planiranja u javnim organizacijama omogucava
racionalnije, ucinkovitije i efektivnije upravljanje
resursima organizacije, Strateskim planiranjem definiraju se
odredeni vidovi mjerenja performansi sto smanjuje
mogucnost alociranja resurse na temelju subjektivnog stava ili
osjecaja, ambicije ili svojevrsnog odgovora na
odredeni politicki pritisak. Time se doprinosi transparentnom,
racionalnom, ucinkovitom i efektivnijem
upravljanju organizacijom u pruzanju kvalitetnih javnih usluga.
KLJUCNE RIJECI
strateski menadzment, strateäko planiranje, javna organizacija,
menadzment
77
Copyright of Interdisciplinary Description of Complex Systems
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Interdisciplinary Society and its content may not be copied or
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written permission. However, users
may print, download, or email articles for individual use.
Todd L. Ely is assistant professor in the
School of Public Affairs at the University of
Colorado Denver, where he teaches courses
on governmental budgeting and account-
ing, public fi nance, and local government
management. His research addresses the
fi nancing of state and local public services,
education fi nance and policy, and public
and nonprofi t fi nancial management.
E-mail: [email protected]
Benoy Jacob is assistant professor in the
School of Public Affairs at the University of
Colorado Denver and director of the Center
for Local Government Research and Training
in the Buechner Institute for Governance.
His research addresses issues in local politi-

cal economy.
E-mail: [email protected]
38 Public Administration Review • January | February 2013
Public Administration Review,
Vol. 73, Iss. 1, pp. 38–48. © 2012 by
The American Society for Public Administration.
DOI: 10.111/j.1540-6210.2012.02594.x.
Todd L. Ely
Benoy Jacob
University of Colorado Denver
Th is article explores public sector responsiveness to voter -
led initiatives, specifi cally, the degree to which public
managers attempt to lock in resources before they are
constrained by a particular initiative. Th e authors posit
that such behavior, which they term “beating the clock,”
is a function of the potential impact of the proposed
initiative, the degree to which managers can react to the
initiative’s central issues, and the perceived likelihood
of passage. Although scholars have explored diff erent
responses to voter-led initiatives, this particular form of
strategic behavior has yet to be studied. Using longitu-
dinal data on public debt issuance, hypotheses are tested
in the context of a reform proposed through the initia-
tive process in Colorado in 2010. Results show that the
number of debt issues increased by roughly 150 percent
in advance of a potentially binding election, indicating
the ability to preempt formal initiative eff orts in certain
policy areas.

In this article, we consider the strategic response of state and
local governments to citizen-led initiatives. Th e extant
literature has focused
on two such responses: direct and indirect. Th ese
responses are distinguished by the observed tim-
ing of public sector behavior.
Direct responses occur after an
initiative has been passed. In
such instances, public offi cials
have been found to either
“work around” the imposed
constraints (see, e.g., Levine,
Rubin, and Wolohojian 1981;
Matsusaka 1995; Mullins
2004) or simply ignore them
(Gerber et al. 2001). In contrast, indirect responses
occur before any particular initiative has been placed
on the ballot. Political actors, then, respond to the
threat of initiatives (see, e.g., Gerber 1996, 1998;
Lupia and Matsusaka 2004). In this article, we
extend the scholarship on these indirect eff ects.
More precisely, we consider the strategic behavior
of public offi cials after an initiative is placed on the
ballot but before it has been voted on. Th us, we
propose an additional form of indirect response in
which public managers may take actions to lock in
policy outcomes before voters have time to (dis)
approve the initiative.
Th e proposed managerial response is driven by three
key factors: (1) the potential negative impact of the
initiative on the government’s capacity; (2) the ability
of the government to respond, given the nature of the
proposed initiative; and (3) the perceived likelihood

of the initiative being passed (i.e., the credibility of
the threat). We test the likelihood of this response in
the context of a recent reform proposed through the
initiative process in Colorado.
In November 2010, Colorado voters were presented
with two amendments to their state constitution—
Amendments 60 and 61—that would have severely
curtailed the ability of state and local governments to
raise revenue and issue debt, respectively. Combined
with the fee-reducing Proposition 101, these ballot
items were labeled the “Bad Th ree” by their vocal
opponents. In the early stages of the campaign, there
was a perception that the initiatives might pass, yet
all three ultimately failed at the
ballot box. Th is case provides a
unique setting in which to test
our claim that public manag-
ers will respond to the mere
possibility of a specifi c initiative
being passed. Using longitu-
dinal data on public debt issu-
ance, both in Colorado and in
neighboring states, we estimate
the responsiveness of public managers during the
initiatives’ active campaign. Our fi ndings support the
expectation of a managerial response to the threat of
policy change, specifi cally, a signifi cant and large spike
in debt issuance in the months preceding the election.
Our article off ers two key contributions: First, since
1904, almost 60 percent of the initiatives proposed in
the United States have failed.1 Scholars have paid little

Beating the Clock: Strategic Management under the Th reat
of Direct Democracy
Th is case provides a unique
setting in which to test our
claim that public managers will
respond to the mere possibil-
ity of a specifi c initiative being
passed.
Beating the Clock: Strategic Management under the Threat of
Direct Democracy 39
key resources (Denhardt 1985; Dodge and Eadie 1982; Eadie
1983). Clearly, diff erences in the availability of such resources
will
lead to variation in the quality and effi ciency of public service
provi-
sion (Jacob et al. 2008; Ziblatt 2008). Th us, it stands to reason
that
initiatives posing a greater threat to available resources will
lead to
greater actions to protect existing resources or garner new ones.
Second, we argue that the likelihood of a public manager pursu-
ing resources in advance of the election will depend on the
degree
to which public managers can react quickly to the issues central
to a proposed initiative. Th is, of course, is a function of the
characteristics of the particular initiative, as a manager’s
discre-
tionary authority will vary across issues (Brown and Potoski

2006;
Whorton and Worthley 1981). In our particular analysis, for
example, we focus on the strategic behavior around Amendment
61 because, unlike the resources targeted in Amendment 60
(property taxes) and Proposition 101 (fees), public managers do
exercise some discretion over the issuance of debt and can issue
certain types of debt relatively quickly (i.e., over the campaign
period).
Finally, the beat-the-clock response will be predicated largely
on the
perceived likelihood of a proposed initiative passing, as
managers
must sense that the threat of new constraints is real.4 It is quite
pos-
sible that an initiative has enough support to get on the ballot
but
not enough for it to pass. In this case, there is less reason to
react.
Th us, we anticipate a strong eff ort to secure resources in
advance
of an election primarily if the initiative is thought to have wide
support or if there is signifi cant uncertainty regarding the level
of
support. Th at said, the magnitude of the response may also
depend
on the degree to which diff erent public managers are risk
averse and
unwilling to accept even low levels of risk associated with a
ballot
item’s passage. Managers may also use a low-probability ballot
threat
as an excuse for engaging in an already desired policy response.
In
short, government responses may still be observed even if the
ballot

initiative is not particularly credible.
Our argument leads to the following hypothesis: If a proposed
initiative is deemed credible and is likely to constrain resources
over which public managers have discretion, then public
managers
may try to secure these resources prior to the election. Implicit
in
this hypothesis is that managerial behavior (i.e., eff orts to
secure
resources) will vary during the campaign period as suppor t for
an
initiative waxes and wanes. We test the hypothesis in the
context of
a recently proposed citizen initiative in Colorado.
Colorado’s Amendment 61
On the November 2010 ballot, Colorado
voters were presented with Amendments 60
and 61 and Proposition 101. Th ese initiatives
aimed to constrain local property taxes, limit
the issuance of debt, and constrain state and
local fees, respectively. Th us, their passage
would have severely curtailed the ability of
state and local governments to raise rev-
enue and issue debt. Our analysis is focused on the public
sector’s
response to Amendment 61. We begin by briefl y elaborating
some
of the nuances of public debt issuance, particularly in the state
of
Colorado.
heed to the impacts of failed initiatives on the behavior of
manag-

ers and policy makers. Our work demonstrates that the
anticipated
outcomes of an initiative can have important impacts on the
subse-
quent operations of public organizations, in particular, by
locking
in resources that are not immediately required. Second, to date,
scholars of public management have largely ignored the
political
process; most management models do not explicitly account for
the
way in which public managers deal with political pressures
(Bryson,
Berry, and Yang 2010). In contrast, we consider managerial
behavior
within an explicitly political process.2
We proceed by fi rst situating our argument within the broader
lit-
erature on strategic management and direct democracy. Second,
we
describe the Colorado ballot item that defi nes the empirical
context
for this study. Th ird, we outline our empirical strategy and
provide
an analysis of government debt issuance in the period leading
up to
the vote. We conclude with a discussion of the implications of
our
study.
Managerial Responsiveness to Direct Democracy
Strategic management arrived in the United States in the mid-
1980s. Since then, a large proportion of American local govern-
ments have voluntarily adopted strategic planning or
management

practices (Poister and Streib 1994). Fundamental to such
practice
is the eff ective management of the external environment.
Direct
democracy, in the form of citizen-led initiatives, represents an
important challenge to this objective.3
Because initiatives are instituted by a petition from a suffi
cient
number of citizens, greater scope exists for previously
unrecognized
stakeholders to abruptly exert political infl uence (Budge 1971)
outside the normal policy-making process. Consider the
following
scenario: A citizen-led initiative is put on the ballot that will
signifi -
cantly constrain the resources available for the provision of
public
goods and services, which must still be provided after the
constraints
are imposed. Not having anticipated such proposed constraints,
legislators failed to adopt similar, though less restrictive,
legisla-
tion ex ante. Public managers can wait to see whether the ballot
is
passed and, if it is, they can either (1) do their best to provide
public
services within the new constraints or (2) fi nd a way around the
imposed constraints. We argue that there is a third, yet
unexplored,
option, which we term “beating the clock.”
Assuming that public managers prefer more resources to less, it
seems unlikely that they will wait to see whether an initiative
passes
before taking action, particularly if they have

some control over those resources. We argue
that public offi cials will respond proactively
to secure resources before new restrictions are
actually voted on—that is, they will try to
beat the clock. We propose that three factors
drive such a response: (1) the potential impact
of the initiative, (2) the government’s ability
to respond, and (3) the credibility of the
threat.
First, the likelihood that the organization preempts the initiative
will be related to its potential impact. Fundamental to a
manager’s
ability to provide public services is the ability to secure and
manage
We argue that public offi cials
will respond proactively to
secure resources before new
restrictions are actually voted
on—that is, they will try to beat
the clock.
Th us, the early eff orts at information dissemination were
largely
oriented around “defi ning” the impacts of the initiatives. More
precisely, between December 2009 and approximately the end of
March 2010, it was made clear that the initiatives would have a
det-
rimental impact on the public fi nances if passed. At that time,

the
issue for public managers would have been, what is the
likelihood
that the initiatives will pass, come election time? Th is
information,
in the form of public opinion polls, would not start to emerge
until
the more public phase of the campaigns in late summer and
early
autumn of 2010.
Press coverage of the ballot items in the state’s major
newspaper, the
Denver Post, illustrates that public visibility peaked in
September
and October, the two months preceding the election (see fi gure
1).
In early September, it was reported that Amendment 61 had the
highest support of the three ballot items, at 57 percent positive,
based on internal polling by opponents (Gardner-Smith 2010).
Four publicly released polls soon followed to gauge public
sentiment
on each of the proposed ballot items. Th e results of those polls
are
summarized in table 1, which presents the percentage of
respond-
ents who supported (S), opposed (O), and were undecided (U)
on the initiatives. In early September, one poll suggested that
the
outcome hinged on undecided voters, but by the end of the
month,
the Denver Post poll suggested that there was very little support
for
the measures. By mid- to late October, strong popular
opposition to
the ballot items had materialized.7

Public managers have discretion in (1) refunding outstanding
debt, (2) issuing non–general obligation debt with dedicated
revenue sources, (3) determining the timing of issuing previ -
ously voter-approved general obligation debt, and (4) schedul-
ing referenda to pursue voter approval of new general obligation
debt.5 While revenue bonds may avoid voter approval, they still
typically require approval from elected offi cials and the
comple-
tion of a feasibility study in order to secure a bond rating (Vogt
2004, 186). Th e time needed to issue debt varies dramatically
by the particulars of the borrowing, including the complexity of
the issue, current market conditions, market familiarity of the
issuer, and existing relationships with fi nancial intermediaries.
Despite such hurdles, the credit rating process averages three or
four weeks, with some additional time for fi rst-time issuers
(Vogt
2004, 226); thus, it is feasible that public agencies could com-
fortably issue debt between the certifi cation of Amendment 61
and the election. Of course, the fact that they can act does not
suggest that they will act. Two other factors, which are central
to
our argument, provide further insight into when we expect
public
offi cials to act.
A second factor in our argument is the degree to which an
initia-
tive is seen as signifi cantly constraining the available
resources.
Amendment 61 was aimed at limiting the issuance of debt. It
would have banned the state of Colorado from issuing any form
of debt, and it would have required all local government debt to
be approved through November elections, in addition to impos -
ing new constraints on the maximum amount to be borrowed. Th
e

potential impact was not inconsequential. For example, the
borrow-
ing potential of Arapahoe County, the state’s third-largest
county
(located adjacent to the city and county of Denver), would have
been reduced from $1.9 billion to $780 million (Bell Policy
Center
2010). Th us, we suspect that the impacts of this initiative
would be
seen unfavorably and would have provided an incentive to
public
managers to proactively secure resources.
Th e fi nal factor in our argument is the credibility of the threat.
By
“credibility,” we are referring to the perceived likelihood that
the
proposed initiative will pass when it is put before the electorate.
For
our analysis, we need to clearly articulate whether and when,
during
the campaign period, public offi cials perceived that the ballot
item
was credible. A brief summary of the campaign timeline will
shed
some light on this issue.
First, the ballot items received Statements of Suffi ciency from
the
Colorado Secretary of State’s offi ce in early December 2009.
Almost
immediately, the detrimental impacts of the proposed items
were
identifi ed. For example, a local research and advocacy group
issued
a preliminary analysis of the ballot items, while in mid-

February
2010, a law fi rm that serves as bond counsel to many Colorado
governments issued a client advisory highlighting “some of the
practical steps that governments may choose to take between
now
and November 2010 to be prepared if one or more of the
initiatives
is approved” (Sherman & Howard LLC 2010). A few months
later,
another law fi rm produced a memorandum analyzing the
potential
impacts of the ballot items, noting that, if passed, their
interpreta-
tion “is likely to play out in the courts for years and, while it
does,
could severely limit the ability of Colorado governments to fi
nance
public projects in the capital markets” (Kutak Rock LLP
2010).6
0
5
10
15
20
25
In
s
ta

n
c
e
s
o
f
C
o
v
e
ra
g
e
Note: News coverage was determined with multiple searches of
the Denver Post using
LexisNexis Academic and the search terms “Amendment* and
61 and 60 and 101” between
November 1, 2009, and October 31, 2010.
Figure 1 Monthly Instances of Ballot Item Coverage in the
Denver Post
Table 1 Polling Support Percentages by Poll, Date Reported
Ballot item
Ciruli
9/3/10

Denver Post
9/30/10
Denver Post
10/21/10
RBI
10/26/10
S O U S O U S O U S O U
Amendment 60 32 45 23 10 48 42 18 59 23 19 68 13
Amendment 61 36 34 29 10 49 40 18 63 20 25 68 7
Proposition 101 51 33 16 12 44 44 21 55 24 27 64 9
Note: “S” represents a response supporting the ballot item, “O”
opposes,
and “U” is undecided. Although the exact wording of the
surveys varies, these
categories track the general sentiment across surveys.
Sources: (1) Ciruli Associates Poll, September 3, 2010; (2) Tim
Hoover, “Colo-
rado Voters Down on Obama, Several Statewide Ballot Issues,”
Denver Post,
October 4, 2010; (3) SurveyUSA, Election Poll no. 17420,
release date October
22, 2010, sponsored by the Denver Post; (4) RBI Strategies &
Research, Cross-
tabs—Colorado Statewide Survey, October 2010.
Direct Democracy 41

the particular state and t is the month of issuance. Th e
independ-
ent variable of interest, Th reat
s,t
, is a dichotomous indicator of
the threat period. Following the timeline developed earlier, it is
operationalized in a number of ways. Our preferred specifi
cation
narrowly defi nes the threat period as the two months
(September
and October 2010) that began with the fi rst public polling for
the
amendment and ended when the threat, as refl ected in the polls
and the ballot box, dissipated (the election on November 2,
2010).
Alternative specifi cations use the three-month period preced-
ing the election (August, September, and October 2010) and the
four-month period surrounding the election (September through
December 2010).
Th e demand for debt depends on both the characteristics of the
issuer and the current debt market. Th e model includes state fi
xed
eff ects, υ
s
, to control for time-invariant state characteristics that are
expected to either promote or inhibit debt issuance. For
example,
neighboring sample states have relatively stable but vastly diff
erent
numbers of governments, ranging from 599 in Utah to 3,931 in
Kansas (U.S. Census Bureau 2008). A state with a large number

of
governments will have a larger number of debt issues, all else
being
equal.
Th e state fi xed eff ects implicitly capture whether a state is a
high-
or low-debt state, although they do not capture changes in debt
outstanding over the study period. Past debt issuance by a state
and its local governments is expected to reduce future issuances
in
two ways. First, high per capita debt outstanding refl ects past
bor-
rowing and investment in long-lived assets. Th e persistent
nature
of capital means that fewer investments and related borrowing
will be necessary in the near future. Second, a relatively high
debt
burden may be expected to increase the cost of capital as the
risk
associated with the underlying tax base grows, leading decisi on
makers to shy away from further raising debt levels (Robbins
and
Simonsen 2012).
To control for debt market conditions, we use the aggregated
monthly number of municipal bonds issued or the dollar value
of
bonds issued nationally, excluding the sample states in both
cases.
Th is control, BondMarket
t
, is especially important for the tumultu-
ous years since the credit crisis began. Th e national market

activ-
ity measure is a proxy for variables that infl uence the number
and
volume of debt issuances, such as interest rates and
expectations
regarding future interest rates. It refl ects broad economic
trends, as
well as investor sentiment and appetite for municipal bonds. Th
is
market activity variable also controls for nationwide trends
driven
by external policy changes during the period, such as the
introduc-
tion of the federal Build America Bonds tax credit bond
program
(see Maguire 2010).
Data
Based on our empirical approach, we employ data on municipal
bonds issued within Colorado and seven neighboring states over
a 44-month period delineated by the start of the credit crisis,
running from October 2007 through May 2011, by querying
Th omson Reuters SDC Platinum database (U.S. Municipal New
Issues). Since October 2007, there were 7,778 bond issues in
these
states (excluding issues with less than a year to maturity). Th e
data set was then reduced to include only long-term municipal
Despite the fact that passage of Amendment 61 appeared
unlikely, resource-conscious public managers may err on the
side
of caution and secure resources before the election.8 Th e
possible
presence of an indirect eff ect even when an initiative is not
partic-
ularly credible suggests the phenomenon might represent behav-

ior beyond simply responding to likely constraints. Th at said,
the
lead time involved in issuing debt means that managers would
have started to respond to the threat by initiating the issuance
process prior to polls indicating decreased support. Th e actual
issuance of debt is a lagged indicator of the unobserved
decision
of public managers to issue debt before the election.
Nevertheless,
we expect this response to diminish as public support waned in
the polls closer to the election, as managers can delay or cancel
the sale of bonds.
In sum, the Colorado case provides a setting in which our three
conditions for employing a beat-the-clock strategy are present
to
varying degrees. Th e potential impact of the threat was high,
the
credibility of passage was present early in the campaign period
(by
at least September 2010), and government managers had the
ability
to respond. Th us, it is an ideal environment in which to test the
hypothesis that resource-conscious managers will act to preempt
an initiative’s proposed constraints on future resources. Th is
should
be refl ected in an increase in debt issues when managers were
faced
with the threat of policy change.
Empirical Strategy
Given the nature of Amendment 61, our primary interest is the
possible increase in debt issuance activity by the state of
Colorado
and its local governments. We consider two types of issuance:
new

money and refunding of existing debt. New money issues
represent
incremental obligations of the government to raise resources for
projects, while the refunding of outstanding debt by a govern-
ment is akin to a homeowner refi nancing a mortgage. Not only
can it be used to secure lower interest rates for the debt, but
also
it can extend the fi nal maturity date of the debt. Both types of
issuance represent a potential strategic response to the proposed
Amendment 61.
Th e measurement of a management response to the amendment
requires identifying a counterfactual, or cases that represent the
likely behavior of the state and its local governments in the
absence
of the proposed ballot item. Because governments in
neighboring
states frequently issue debt for similar purposes as Colorado,
we
use their borrowing activity in the absence of the ballot
initiative
for comparison.9 More precisely, we expect to see a spike in
debt
issuances in Colorado over the threat period but no such
response in
adjacent states.
Empirical Model and Methods
Th e core of our analysis is a parsimonious model of debt
issuance.
We use multiple regression analysis to estimate the eff ect of
the
proposed ballot item on state and local government behavior in
Colorado:10
BondsIssued

s,t = β0 + β1Th reats,t + β2BondMarkett + υs + εs,t
Our dependent variable, BondsIssued
s,t
, is operationalized in two
ways: (1) as the total number of bonds issued and (2) as the
dollar
amount of bonds issued by state and local governments, where s
is
common, followed by state authorities and cities. Although it is
not an outlier in any of the bond issue characteristics, Colorado
ranks highly among the comparison states in average years to
fi nal maturity, average par amounts, use of non–general obliga-
tion bonds, portion of refunding issues, and portion of taxable
bonds.
Th e number and volume of municipal bonds issued nationally is
taken from Th e Bond Buyer’s Market Statistics Archive. Table
3
presents additional information about Colorado and the adjacent
states that are used as our comparison group. State information
on
fi nances and government organization is gathered from the U.S.
Census Bureau’s Annual Finance Survey and 2007 Governments
Integrated Directory, respectively. Most notably, Colorado is
the
second largest of the comparison group states with regard to
popula-
tion, and it has the highest amount of debt outstanding as of
2008,

both in absolute and per capita terms.
bonds because we are not interested in the routine short-term
borrowing behavior typically used to smooth government cash
fl ows. We eliminated the majority of short-term notes by
exclud-
ing bond issues with fi nal maturity dates less than three years
away.11 Th e remaining individual bond issues were aggregated
by
state and month to create both a count of issues in a state during
each month as well as the combined face value of the bond
issues
(i.e., the par amounts).12 We have 352 observations for the
eight
states over this postcrisis period. Limiting our analysis to this
time
period is preferable because bond activity was altered after the
cri-
sis. As a precaution, we also applied our models to a longer
panel
beginning before the crisis, which resulted in 520 state-month
observations.
As seen in table 2, Colorado is similar to the comparison states
with respect to the number of bonds issued and the leading
types
of issuers, with districts, both special and school, being the
most
Table 2 Descriptive Statistics of Long-Term Bonds Issued by
Sample States, January 2006–May 2011
Number of
Issues
Average Maturity

(years)
Average Par Amount
(millions)
General Obligation
Bonds (percent)
Refunding Issues
(percent)
Taxable Bonds
(percent)
Top 3 Leading Issuer Types
Arizona 851 20.20 $44.87 44.77 13.75 8.93 1. Special/school
districts
2. Local authorities
3. Cities
Colorado 1,230 22.28 $33.26 35.61 27.97 12.68 1.
Special/school districts
2. State authorities
3. Cities
Kansas 1,356 16.05 $10.94 66.74 23.91 12.39 1. Cities
2. Special/school districts
3. Counties
Nebraska 1,769 14.94 $8.14 69.25 32.00 6.90 1. Special/school
districts
2. Cities
New Mexico 475 16.28 $30.57 55.79 14.11 10.11 1.

3. Cities
Oklahoma 1,372 10.71 $10.64 69.83 4.81 6.41 1. Special/school
districts
Utah 571 19.92 $29.21 23.64 22.59 19.44 1. Cities
3. Special/school districts
Wyoming 154 25.37 $18.42 14.94 9.09 11.04 1. Special/school
districts
3. Cities
All 8 States 7,778 16.78 $20.18 55.67 20.92 10.11 1.
2. Cities
Note: These descriptive statistics are based on the data used in
our preferred model specifi cation. This includes all bonds
issues (new money and refunding) with
more than three years to maturity.
Table 3 Descriptive Statistics of Sample States’ Population,
Area, Outstanding Debt, and Number of Governments
Population (2008) Area (square
miles)
Population

Density (2008)
Long-Term Debt Outstanding
(thousands, 2008)
Debt Per Capita
(2008)
Number of
Governments (2007)
Residents per
Government (2008)
Arizona 6,499,377 113,998 57.0 $43,473,897 $6,689 645 10,077
Colorado 4,935,213 104,094 47.4 $49,425,722 $10,015 2,416
2,043
Kansas 2,797,375 82,277 34.0 $20,714,690 $7,405 3,931 712
Nebraska 1,781,949 77,354 23.0 $13,852,408 $7,774 2,659 670
New Mexico 1,986,763 121,589 16.3 $13,132,242 $6,610 863
2,302
Oklahoma 3,644,025 69,898 52.1 $16,928,380 $4,646 1,880
1,938
Utah 2,727,343 84,899 32.1 $16,313,800 $5,982 599 4,553
Wyoming 532,981 97,814 5.5 $2,340,951 $4,392 726 734
Source: U.S. Census Bureau, Annual Surveys of State and Local
Government Finances, 2008.
Direct Democracy 43
and the threat of Amendment 61. Th e results of the primary
regres-

sion analysis are presented in column A of table 4, which uses
the
total number of monthly bond issues in a state as the dependent
variable. Th e number of bond issues in Colorado increased
signifi -
cantly relative to neighboring states as the threat of Amendment
61
loomed. Th e ballot threat resulted in an increase of roughly 24
bond
issues per month in Colorado, nearly 150 percent above
average.
In an eff ort to judge the robustness of the results, we
performed a
number of falsifi cation exercises.
Several alternative specifi cations were estimated: (1) without
state
fi xed eff ects; (2) with only new money issues; (3) over a
longer
period of time, including the pre–credit crisis months; (4) with
the
two alternative threat periods discussed earlier; (5) with the
depend-
ent variable standardized across sample states as the fraction of
the
state’s average monthly bond issuance over the study period;
and
(6) using negative binomial regression to account for the nature
of the count data dependent variable (see table 4). Th e
direction
and signifi cance of the eff ect is consistent across specifi
cations. Th e
coeffi cient for the threat period is smaller when the panel is
not
restricted to post–credit crisis because of generally higher
precrisis

debt activity and when only new money issues are included
(because
they represent only about two-thirds of Colorado issues during
the
study). Th e longer panel (not restricted to the postcrisis period)
validates the fi nding that the response of governments is not
simply
an artifact of the credit crisis. Th e use of the standardized
dependent
variable affi rms the previous fi ndings and, taking into account
the
count nature of the issuance dependent variable, the negative
bino-
mial regression results reinforce that the number of monthly
debt
issues increased by at least 100 percent during the threat period.
Th e magnitude of our results is noteworthy, but it likely
understates
the behavioral response to the threat of the ballot items. A por-
tion of the reaction by managers may manifest itself in forms
other
than debt issuance. For example, it was reported that referenda
were being held to increase taxes so as to avoid the limitations
of
the proposed Amendment 60 (Illescas 2010). More important for
considering the specifi c response to Amendment 61,
governments
that waited to see whether the preelection support ultimately
waned
or the amendment passed may have decided not to go to market
despite having already completed the extensive planning
process for
issuing debt. As Denver-based attorney Dee Wisor stated, “I
have
some clients who are queuing up to do these deals after the

election
but before the end of the year. But if the ballot issues don’t
pass,
they probably won’t do the deals this year” (Williamson 2010).
In addition to the observed change in the number of debt issues
in
Colorado in response to the threat of Amendment 61, we might
also expect to observe diff erent levels of reaction by
government
type. Th is is especially true if the impacts of the amendment
are not
evenly distributed across diff erent levels of government, which
was
the case, with state government likely being the most
constrained.
Table 5 displays the percentage of total bond issues by the diff
erent
types of government in Colorado during a number of time
periods.
During the threat period, cities are overrepresented, with more
than
30 percent of issues, relative to historical patterns of issuance
in
Colorado. Cities are more heavily dependent on sales tax
revenue in
Colorado than counties and the state government. Heightened fi
scal
stress in response to the dramatic downturn in economic activity
Results
We have argued that public managers will take action to lock in
resources before voters have time to (dis)approve a resource -
con-
straining initiative. Th is managerial response is driven by three
key

factors: (1) the potential impact of the initiative, (2) the govern-
ment’s ability to respond, and (3) the credibility of the threat.
Th us,
given Amendment 61, we expect to see a spike in debt issuance
during the two months preceding the ballot item vote
(September
and October 2010), when the strategic management responses to
the threat would manifest.
We fi rst present visual evidence of the relationship (fi gure 2).
As
expected, the number of monthly bond issues in Colorado did
indeed spike in the two months preceding the election and then
declined. Figure 3 presents the percentage deviation from the
aver-
age monthly number of municipal bond issues in Colorado and
nationally (excluding Colorado) over the study period. Th e
jump
in Colorado issuance, between 150 percent and 200 percent
above
average, in September and October 2010 is clearly visible. Th e
Colorado bond issues do not simply match patterns of national
debt
activity. Moreover, as seen in fi gure 4, the spike seen in
Colorado is
not replicated in any of the comparison states.
Using the debt issuance in neighboring states, as well as
issuance
activity in Colorado before and after the threat period, we
employ
regression analysis to judge the statistical signifi cance and
magnitude
of the visible relationship between the bond issuance in
Colorado

-100
-50
0
50
100
150
200
O
ct
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n
-0
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p
r-
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l-

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ct
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D
e
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a
tio
n
(
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)
fr
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m
A
vg
.
M
o
n
th
ly
B
o
n
d
I
ss

u
a
n
ce
Colorado Nation
Figure 3 Percentage Deviation from Average Monthly Bond
Issuance (number of issues), Colorado and Nation, October
2007–May 2011
0
5
10
15
20
25
30
35
40
45
50
O

ct
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n
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ly
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n

d
I
ss
u
e
s
Ballot Items
Certified
Ballot
Item
Election
Note: Bond issue counts include long-term debt issued during
the period as reported in
Thomson Reuters SDC Platinum.
Figure 2 Colorado Monthly Bond Issuance (number of issues),
October 2007–May 2011
the increased debt activity simply represents the shifting of
future
debt issuance into the preelection period rather than a net long-
term
increase in government borrowing. An additional specifi cation
of
the model estimates the relative debt issuance, by number of
issues,

in the months following the election that are available in our
data
set. Th is postelection dummy variable has a negative and
statistically
signifi cant coeffi cient (see column I in table 4), suggesting
that the
number of issuances was reduced by nearly fi ve issues per
month for
the seven months following the election. Th is represents nearly
60
percent of the increased issuance observed during the threat
period
and provides some evidence that, at least to date, 40 percent of
the
increased issuance came from new activity spurred on by the
threat
of the amendment.
Th e number of issues is our primary indicator of increased
activ-
ity because it is a representation of an individual government’s
over this period may have made cities more responsive to the
per-
ceived threat of future constraints.
If governments are trying to circumvent the will of voters, then
we
might also expect the use of high-discretion bond types, such as
rev-
enue and refunding bonds, to increase during the period, as
opposed
to general obligation debt, which requires public approval.
Revenue
bonds already make up a majority of the issues in Colorado
(nearly

67 percent) during the study period. Th is proportion increased
by a few percentage points during the two months when govern-
ments were expected to most actively respond to Amendment
61.
Similarly, the proportion of debt issues that were purely
refunding
versus new money saw a modest increase during the threat
period.
Having established that there was an increase in bond issuance
in
the months prior to the election, it makes sense to consider
whether
Note: Bond issue counts include long-term debt issued during
the period as reported in Thomson Reuters SDC Platinum.
Figure 4 Monthly Bond Issuance (number of issues), Colorado
and Comparison Group States, February 2010–May 2011
0
10
20
30
40
50
M
o
n

th
ly
D
e
b
t
Is
s
u
e
s
Colorado Arizona
0
10
20
30
40
50
M
o
n
th

ly
D
e
b
t
Is
s
u
e
s
Colorado Kansas
0
10
20
30
40
50
60
M
o
n
th
ly
D
e

b
t
Is
s
u
e
s
Colorado Nebraska
0
10
20
30
40
50
M
o
n
th
ly
D
e
b

t
Is
s
u
e
s
Colorado New Mexico
0
20
40
60
80
M
o
n
th
ly
D
e
b
t
Is

s
u
e
s
Colorado Oklahoma
0
10
20
30
40
50
M
o
n
th
ly
D
e
b
t
Is

s
u
e
s
Colorado Utah
0
10
20
30
40
50
M
o
n
th
ly
D
e
b
t
Is
s

u
e
s
Colorado Wyoming
Direct Democracy 45
dollar amount or par value of bond issues in a state as the
depend-
ent variable (table 6). Th e results are consistent with our
previous
fi ndings in direction, although the magnitude is less
pronounced.
decision to borrow, but it can be argued that the dollar amount
of debt issued is also relevant. Th e reported specifi cations are
estimated using the natural logarithm of the aggregated monthly
Table 5 Composition of Colorado Bond Issuance by Issuer and
Issue Type (percentage of issues)
Time Period State County City Higher Education Special/
School
Districts
State Authority Local Authority Tribe Revenue
Bonds
Refunding
Issues

Five-year (1/2006–5/2011) 0.98 5.37 18.78 3.74 41.38 21.71
7.89 0.16 64.39 27.97
Postcrisis (10/2007–5/2011) 1.42 5.39 21.84 4.82 39.86 18.87
7.66 0.14 67.09 28.37
Threat period (9/2010–10/2010) — 5.81 31.40 6.98 38.37 10.47
6.98 — 70.93 30.23
Note: These descriptive statistics are based on the data used in
our preferred model specifi cation. This includes all bonds
issues (new money and refunding) with
more than three years to maturity.
Table 4 State Monthly Number of Bond Issues Regression
Model Results
(A) (B) (C) (D) (E) (F) (G) (H) (I)
Primary–
Issue Count
Primary–No
State F.E.
New
Money
Long Panel Alternate Threat Period
(Aug.–Oct. 2010)
Alternate Threat Period
(Sept.–Dec. 2010)
Relative
Issuance
Negative Bino-

mial Regression
Post-Threat
Issuance
Ballot threat (0,1) 24.056*** 24.219*** 16.551*** 20.950***
14.973** 13.122** 1.48*** 0.779*** —
(1.660) (1.721) (1.040) (1.652) (7.554) (5.913) (0.101) (0.276)
Postelection (0,1) — — — — — — — — –3.56**
(1.505)
National issuance 0.013*** 0.013*** 0.009*** 0.013***
0.013*** 0.013*** 0.001*** 0.001*** 0.013***
(0.002) (0.003) (0.002) (0.002) (0.002) (0.002) (0.000) (0.000)
(0.002)
Constant 3.853** 0.733 3.850*** 3.490** 3.711** 3.876**
0.262*** 1.677*** 2.938*
(1.521) (2.438) (1.352) (1.464) (1.530) (1.540) (0.100) (0.132)
(1.650)
Observations 352 352 352 520 352 352 352 352 352
R2 0.598 0.078 0.471 0.530 0.588 0.588 0.152 0.163 0.574
Adjusted R2 0.588 0.073 0.457 0.521 0.577 0.577 0.130 —
0.564
Robust standard errors in parentheses.
*** p < .01; ** p < .05; * p < .10.
Note: The dependent variable in all columns, except C and G, is
the number of monthly bond issues in a state (including both
long-term new money and refunding
activity). Column C excludes issues that were only for
refunding purposes. Column G uses the fraction of the average
monthly number of bond issues for the given

state issued in the current month as the dependent variabl e
(current month number of issues in state/average monthly
number of issues in state). The independent
variable of interest, ballot threat, is a dichotomous variable set
to 1 in September and October 2010, the two months preceding
the November 2 election, when public
awareness of the ballot items peaked, and to 0 otherwise. This
operationalization is used in all specifi cations, except for
columns E and F, which use expanded threat
periods, including August and September through December
2010, respectively. National issuance is the total number of
municipal bonds issued nationally in each
month, less the issuance from the comparison group states. All
specifi cations, except column B, include state fi xed effects.
Pseudo R2 is reported for the negative bi-
nomial regression. Column I excludes the ballot threat indicator
as an independent variable and includes a dichotomous variable
set to 1 beginning in November 2010
following the election for Colorado.
Table 6 State Monthly Volume of Bond Issuance Regression
Model Results
(A) (B) (C) (D) (E) (F) (G) (H)
Primary–Issuance
Amount
Primary–No
State F.E.
New Money Long
Panel
Threat Period
(Aug.–Oct. 2010)

Interdisciplinary Description of Complex Systems 12(1), 61-77,

Interdisciplinary Description of Complex Systems 12(1), 61-77,

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