Series editor(s): Donna Bobek Schmitt
Subject Area: Accounting and Finance
|Title:||BUDGETARY SLACK CREATION AND TASK PERFORMANCE: COMPARING INDIVIDUALS TO COLLECTIVE UNITS|
|Author(s):||James M Kohlmeyer, James E Hunton|
|Volume:||7 ISBN: 978-0-76231-117-0 eISBN: 978-1-84950-280-1|
|Citation:||James M Kohlmeyer, James E Hunton (2004), BUDGETARY SLACK CREATION AND TASK PERFORMANCE: COMPARING INDIVIDUALS TO COLLECTIVE UNITS, in (ed.) 7 (Advances in Accounting Behavioral Research, Volume 7), Emerald Group Publishing Limited, pp.97-122|
|DOI:||10.1016/S1475-1488(04)07005-X (Permanent URL)|
|Publisher:||Emerald Group Publishing Limited|
|Article type:||Chapter Item|
|Abstract:||The purpose of this study is to investigate differences between individual and collective budgeting decisions with respect to budgetary slack creation and task performance. While a great deal of research exists in the area of budgeting, to our knowledge, no prior studies have dealt with budget settings in a collective (e.g. small group or cross-functional team) environment. Accordingly, the current study examines differences in slack creation and task performance using a two (decision mode: individual vs. collective decision) by two (incentive contract: slack-inducing vs. truth inducing) between-subjects experimental design. A total of 295 students participated in the experiment (79 individuals and 72 three-person collective units). As expected, individuals and collective decision-makers created significantly more slack under a slack-inducing contract than a truth-inducing contract. Additionally, as anticipated, collective decision-makers created more slack than individuals under a slack-inducing contract. Unexpectedly, however, collective decision-makers created more slack than individuals using a truth-inducing contract. Task performance was significantly different between individuals and collective unit members, such that performance of former exceeded latter, as hypothesized. Finally, preliminary analysis indicated that choice shift occurred in the collective units, such that the units became more cautious in setting budget goals than individuals under both incentive contract conditions.|
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