Managing Inefficiency of Participatory Budgeting by Investigating the Dark Side Personality of Managers
Journal Title: Polish Journal of Management Studies - Year 2019, Vol 19, Issue 2
Abstract
Participatory budgeting is widely promoted as a new reform in finance management. However, regardless of its acknowledged effectiveness, the model also produces managers’ moral hazard known as budgetary slack that is a propensity to underestimate the revenue but overestimate the cost. The objective of this article is to examine the relationships of human factors in budgeting process in terms of personality, budget participation, and the propensity of managers to create budgetary slack. Using the HEXACO model (Honesty-Humility, Emotionality, eXtraversion, Agreeableness, Conscientiousness, and Openness to Experience), Structural Equation Model is employed to prove the existence of the traits which is commonly associated with dark traits leading to unethical behavior in the workplace. A survey data from 150 respondents were used to conduct a structural equation modelling analysis. The results indicate that budget participation incrementally affects the propensity to create budgetary slack making the reform strategy to encourage manager participation to eliminate budgetary slack might not be relevant.<br/><br/>
Authors and Affiliations
Budi Suryadi, Hendrati Dwi Mulyaningsih, Ismi Rajiani
Keywords
Related Articles
- EP ID EP600013
- DOI 10.17512/pjms.2019.19.2.33
- Views 88
- Downloads 0
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