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This study examines how leadership style, budget participation, and perceptions of budgetary fairness influence an important employee outcome, organizational commitment. In the proposed model, the leadership style of the superior, specifically consideration, is linked to subordinate participation in the budgeting process. Both leadership style and budget participation, in turn, influence employee beliefs about budgetary fairness, that is, beliefs concerning the procedural and distributive justice of the budgeting system. Finally, the justice of the budgeting system and its antecedents (leadership and budget participation) affect organizational commitment. Results from a survey of supervisors and managers in several firms support the proposed model.

Budget decision-makers are forced at times to assign budgets that deviate substantially from budget participants’ requests. In these instances, budget participants likely interpret their budgetary involvement as lacking influence and perhaps as pseudo-participative. This experimental study examined two situational factors that may affect perceptions of pseudo-participation: budget favorability (receiving a much better or much worse budget than requested) and disclosure of budget intention (the decision-maker discloses or does not disclose a preliminary budget before the budget decision, with the final budget exactly matching the preliminary budget). As hypothesized, budget participants had a self-serving tendency to discount pseudo-participation as the cause of low influence when they received a favorable budget. However, contrary to a hypothesized effect, budget participants did not have a self-serving tendency to inflate pseudo-participation as the cause of low influence when they received an unfavorable budget. Instead, they formed strong, unbiased pseudo-participation perceptions. Also contrary to a hypothesized effect, the budget decision-maker's disclosure of an intended budget, which should have provided clear indications of an insincere request for budget input, did not increase perceptions of pseudo-participation. Budget outcomes that indicate low influence may evoke such strong perceptions of pseudo-participation as to override other information that suggests pseudo-participation.

This study revisits the area of reliance on budget to evaluate employee performance. It contributes in several ways. First, it updates this traditional research area making it more relevant to the current debate on the use of financial vis-à-vis nonfinancial measures in multidimensional performance measurement systems. Second, it examines the relationship between reliance on budget and budgetary participation in a manner that is different from that used by prior studies. Instead of treating budgetary participation as a moderating variable, the study examines it as a mediating variable. Specifically, the study hypothesizes that reliance on budget as performance measures affects the extent of employee budgetary participation. Third, it incorporates the recent interest by management accounting researchers in organizational fairness into this research area. It hypothesizes that budgetary participation affects the extent of employees’ perceptions of procedural fairness, which, in turn, influences employee job satisfaction and performance. The structural equation modeling results based on a sample of 152 managers indicate that the use of budget targets for performance evaluation is positively associated with employee job satisfaction and performance. However, much of these effects are indirect via (1) budgetary participation and (2) procedural fairness.

This chapter uses agency theory and ethics literature to assess the moderating effect of manager's moral equity on the relation between budget participation and propensity to create slack. Moral equity is the major evaluative criterion for ethical judgment, is based on the overall concept of fairness, justice and right and is often very influential in contemporary moral thought (Robin & Reidenbach (1996) Journal of Business, 5(1) 17–28). The results indicate that a manager's moral equity moderates the effect of budget participation. For managers with high moral equity, the relationship between participation and manager's propensity to create slack is significantly negative while, for managers with low moral equity, the relationship is significantly positive. Further analyses indicate that high budget participation and high moral equity result in less propensity to create slack than high budget participation and low moral equity.

The purpose of this paper is to extend the participative budgeting literature, and specifically the budgetary participation literature that has examined the casual mechanisms linking participation to satisfaction/performance and the literature that has examined culture as an explanatory factor in the budgetary participation/performance relationship.

This paper employs the path model to examine and compare the budget participation–performance relationship for South Korean managers working for either US controlled or Asian controlled companies in South Korea. The path model allows the examination of the direct effects of budget participation on performance and the indirect effects between budget participation and performance that run through job satisfaction and job relevant information.

The primary findings of this study are that while there are strong associations between budget participation and performance for both samples of managers, the causal mechanisms connecting budget participation to performance are different between these two groups. The information–communication connection between budget participation and performance is stronger among the South Korean managers working for US controlled companies.

Our study suffers from three common limitations found in all survey research: lack of temporal precedence between the independent and dependent variables; any limitations imbedded in the scales used to measure our variables; and generalizability of our samples.

The findings presented in this paper should have important implications for US companies employing US management techniques in their foreign operations.

Drawing on equity theory, social exchange theory and goal setting theory, the purpose of this paper is to investigate the contingencies on the link between employees’ budgetary participation and their work performance. Specifically, this study addresses the research questions: whether vertical information sharing and budget goal commitment mediate the relationship between employees’ budgetary participation and their work performance; and whether employees’ perceived budget fairness can strengthen the positive effects of budgetary participation on vertical information sharing and budget goal commitment.

Survey data were collected from a sample of 556 low to middle level managers of business organizations in Vietnam. The research model and its hypotheses were tested using PLS-SEM. The standardized root mean squared residual value of the composite model was employed to assess model fit. Common method bias was also checked using the marker-variable approach.

This study has two key findings: both vertical information sharing and budget goal commitment partially mediate the positive effects of budgetary participation on work performance; and both dimensions of perceived budget fairness (distributive and procedural) elevate the positive relationships of budgetary participation – vertical information sharing and budgetary participation – budget goal commitment.

The findings could benefit businesses in Vietnam and similar market contexts. Specifically, top management needs to select a proper level of budgetary participation that can facilitate information sharing vertically within the organization and motivate their employees to be more committed to achieve budget goals. Besides, the top management also needs to ensure that their employees perceive the fairness in the budgeting process.

The study contributes a greater understanding as regards the mediating roles of vertical information sharing and budget goal commitment as well as the moderating role of perceived budget fairness on the relationship between employees’ participation in the budgetary process and their work performance, especially in the context of an emerging market – Vietnam. Overall, this study contributes to the management and accounting literature with insights concerning a more complex process explaining employees’ work performance and triggered by their budgetary participation.

Research into the impact of the interaction between budgetary participation and budget emphasis on managerial performance and job related attitudes has failed to provide consistent results. Researchers are in general agreement that aspects of national culture, affecting the behaviour and attitudes of individuals within organisations, have to be taken into account. Motivated by the encouraging findings of Harrison's (1992) study in Singapore, this study is a partial replication of Harrison (1992, 1993) in the context of Indonesia. It explores further whether a high budget emphasis is an effective superior evaluative style in nations categorised as high power‐distance (PD) and low individualism. Specifically it examines the effect of participation on the budget emphasis in a superior's evaluative style and dependent variables: job satisfaction and managerial performance. In addition to the structured instruments used in prior research, open ended questions captured attitudes to management control issues. The results indicate that in Indonesia a low budget emphasis improves managerial performance, while high participation increases Indonesian managers' job satisfaction. This result does not wholly support previous research findings and leads to discussion of Indonesian national characteristics which potentially contribute to the impact of a superior's evaluative style in Indonesia. This research suggests that the same performance evaluative style is unequally effective across the nations common to Hofstede's cultural dimensions.

This paper reviews the literature concerning when and in what way citizen participation can have an impact on budgeting. The first part of the paper conceptualizes, through the literature, five budgeting models, each having both problems and solutions for citizen involvement. The second section of the paper explores intervention designs that can be constructive in dealing with the larger problems connecting budgeting and citizen participation. The paper, therefore, seeks to determine where participation in budgeting can have an impact on citizen anger, estrangement, distrust and pessimism.

This study adopts a goal setting theory as the theoretical framework for studying the motivational effect of budgetary participation on job performance. This study proposes that budgetary participation affects job performance via two intervening variables, namely budget goal difficulty and budget goal commitment. The results show that budgetary participation enhances job performance directly and indirectly via budget goal difficulty and budget goal commitment.

Examines the three‐way interaction between budget emphasis, participation and task difficulty affecting managerial performance within the framework suggested by Harrison (1992) with a sample of 197 functional heads from Singaporean and Australian manufacturing companies. The results support a three‐way interaction between budget emphasis, budgetary participation and task difficulty affecting managerial performance and second, cultural differences between Singapore and Australia (pertaining to power distance) which interact neither with budgetary participation nor budget emphasis. The results also suggest that high budgetary participation (regardless of budget emphasis) in high task difficulty situations and high budget emphasis (regardless of budgetary participation) in low task difficulty situations are associated with improved managerial performance in Singapore and Australia.