Fairness, budget satisfaction, and budget performance: a path analytic model of their relationships

Abstract

This study uses a path analytic model to investigate the influence of fairness (i.e., procedural fairness, distributive fairness, and interactional fairness) on managers’ budget satisfaction and the influence of managers’ budget satisfaction on budget performance. To this end, data from 92 U.S. individual managers are used for the study. The results show that fairness perceptions have a significant positive impact on budget satisfaction which, in turn, positively affects budget performance. Further analyses indicate that budget satisfaction mediates the relationship between fairness measures and budget performance. The implications, limitations, and directions for future research are discussed.

Citation

Maiga, A.S. (2006), "Fairness, budget satisfaction, and budget performance: a path analytic model of their relationships", Arnold, V., Clinton, B.D., Luckett, P., Roberts, R., Wolfe, C. and Wright, S. (Ed.) Advances in Accounting Behavioral Research (Advances in Accounting Behavioural Research, Vol. 9), Emerald Group Publishing Limited, Leeds, pp. 87-111. https://doi.org/10.1016/S1475-1488(06)09004-1