To read this content please select one of the options below:

A NOMOLOGICAL FRAMEWORK OF BUDGETARY PARTICIPATION AND PERFORMANCE: A STRUCTURAL EQUATION ANALYSIS APPROACH

Advances in Management Accounting

ISBN: 978-0-76231-139-2, eISBN: 978-1-84950-295-5

Publication date: 13 December 2004

Abstract

This study extends Quirin et al. (2000) by incorporating equity theory (Adams, 1965) into a theoretical model of budgetary participation and performance. The study develops and tests a nomological framework of budgetary participation that includes two organizational constructs, budgetary participation and budget-based compensation, and three individual characteristics, perception of equity, organizational commitment, and employee performance. Measures of these constructs were gathered from a sample of 98 employees in 15 organizations.

In accordance with the proposed theory and hypotheses, results reveal that budgetary participation is associated with increased use of budget-based compensation as well as higher levels of perception of equity and organizational commitment. Budget-based compensation and perception of equity, in turn, are also associated with increased levels of organizational commitment, while elevated commitment was related to higher performance. The results provide further insight into the beneficial aspects of budgetary participation. Specifically, the results indicate that budgetary participation is positively associated with perception of equity, which in turn increases organizational commitment and, ultimately, employee performance.

Citation

Quirin, J.J., O’Bryan, D. and Donnelly, D.P. (2004), "A NOMOLOGICAL FRAMEWORK OF BUDGETARY PARTICIPATION AND PERFORMANCE: A STRUCTURAL EQUATION ANALYSIS APPROACH", Advances in Management Accounting (Advances in Management Accounting, Vol. 13), Emerald Group Publishing Limited, Leeds, pp. 143-165. https://doi.org/10.1016/S1474-7871(04)13006-2

Publisher

:

Emerald Group Publishing Limited

Copyright © 2004, Emerald Group Publishing Limited