Effects of budgetary participation conflict on job performance of Mexican and US managers

Abstract

Abstract This study extends the stream of participative budgeting literature by introducing a new variable, Budgetary Participation Conflict (BPC). BPC occurs when the level of budget participation experienced by a manager differs from a desired level. We propose a model where BPC is the independent variable to further evaluate the effect of budget participation on job performance. Using path analysis, we measure the direct effect of BPC on job performance, and the indirect effects between BPC and performance that run through job satisfaction and job tenure in two countries, Mexico and the US. While the results do not indicate that BPC either directly or indirectly affects the performance of US managers, the results indicate that BPC negatively affects the job performance of Mexican managers indirectly through the effects of BPC on job satisfaction and job tenure. The relationship between tenure and performance is much stronger among the Mexican managers than among their US counterparts, which is the largest single difference between the Mexican and US results.