Predictors, Determinant Groups, and Participatory Budgeting

Recent developments in local public finance management in Slovenia indicate the local governments’ growing interest in introducing participatory budgeting as a decision-making tool, wherein part of local resources are used with citizen participation. Usually, the literature on participation budgeting analyses its effects, but our main research objective was to analyze the possible determinants influencing its implementation. The influence of political factors, sociodemographic factors, economic factors, and the capability of municipalities are examined here using binary logistic regression to predict a dichotomous dependent variable from a set of predictor variables. In binary logistic regression, predictable variables are the probability of one category being chosen. In this case, the authors calculated the probability that a municipality, described by selected prediction variables, would implement a participatory budget. The results of the analysis suggest six indicators that impact the probability of participatory budgeting adoption, proving the influence of four determinants on the decision to adopt such a measure.