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The Effect of Participative Budgeting on Performance-to-Goal

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Authors
백인균
Advisor
신재용
Major
경영대학 경영학과
Issue Date
2016-08
Publisher
서울대학교 대학원
Keywords
Participative budgetingMotivational EffectBudgetary slack
Description
학위논문 (석사)-- 서울대학교 대학원 : 경영학과 회계학전공, 2016. 8. 신재용.
Abstract
Despite continued popularity of participative budgeting, prior studies in this area resort to proprietary survey data, laboratory experimental evidence, or data from single firms with multi-business units due to a lack of detailed information related to participative budgeting. Using a sample of 633 firm-year observations from S&P 1500 firms for fiscal years 2009 to 2011, I examine the relation between the use of participative budgeting and performance-to-goal. First, I find that the performance-to-goal of participative budgeting firms is higher than that of non-participative budgeting firms. Second, I investigate whether higher performance-to-goal is driven by motivational effects or slack building activities triggered by participative budgeting. I decompose performance-to-goal into effort level and budgetary slack using analysts forecasts as the benchmark to show that motivational effects dominate and result in higher performance-to-goal for participative budgeting firms. Overall, this study reaffirms the continued popularity of participative budgeting in a budget-setting process.
Language
English
URI
https://hdl.handle.net/10371/124692
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College of Business Administration/Business School (경영대학/대학원)Dept. of Business Administration (경영학과)Theses (Master's Degree_경영학과)
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