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Budgeting—the Role of Trust and Participation: A Research Note
Author(s) -
Lau Chong M.,
Buckland Christen
Publication year - 2001
Publication title -
abacus
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.632
H-Index - 45
eISSN - 1467-6281
pISSN - 0001-3072
DOI - 10.1111/1467-6281.00092
Subject(s) - norwegian , emphasis (telecommunications) , style (visual arts) , psychology , business , public relations , social psychology , political science , computer science , telecommunications , philosophy , linguistics , archaeology , history
Prior studies have found a combination of an evaluative style with high budget emphasis and high participation to be associated with better behavioural outcomes (e.g., lower job‐related tension) than all other combinations of budget emphasis and participation. Yet there has been little research to investigate the theory on why this particular combination of budget emphasis and participation is associated with better behavioural outcomes. A path analytical model, which investigates the intervening effects of trust and participation on the relationship between budget emphasis and job‐related tension, was used. Senior Norwegian managers were selected as subjects for this study. The results indicate that budget emphasis has an insignificant direct effect on job‐related tension but a strong indirect effect through trust and participation. Trust also has an intervening effect on the relationship between budgetary participation and job‐related tension. It is therefore possible to conclude that high budget emphasis is associated with high budgetary participation and high trust. High trust, in turn, is associated with reduced subordinates’ job‐related tension.