Abstract
<p>The competition is increasingly competitive in the world of education, particularly in this uncertain situation, it encourages every agency to plan, control, and determine the right policies. This study aims to explain the overall relationship between participatory budgeting and managerial performance by including Psychological Capital as an intervening variable and Leader Member Exchange as a moderating variable. The method used was a mixed method with a parallel convergent approach, it is conducted to produce more comprehensive facts. The method of data analysis and hypothesis testing used was Structural Equation Modeling. The survey results of 161 managerial positions in private high schools in DIY indicated that budget participation was directly related to managerial performance. Psychological capital was found to partially mediate the relationship between participatory budgeting and managerial performance. Then, the higher relationship between superiors and subordinates will increase the relationship between participatory budgeting and managerial performance. The survey results were also supported by the results of interviews with informants. This research contributes to the formation of employee of psychological capital and the implementation of leadership style as an important factor in influencing performance.</p>
Highlights
The role of the budget is very essential in the running of business processes, starting from planning, controlling, and making decisions
There are several approaches that can be undertaken in budgeting, one of which is a combined approach known as the participatory budgeting approach (Anthony and Govindarajan, 2009)
It is in line with Bangun's (2017) research, these results explain that participatory budgeting is an important source of success, it is due to it is conducive for each individual to interact with the leader to obtain feedback on their social beliefs, as well as experience in completing tasks
Summary
The role of the budget is very essential in the running of business processes, starting from planning, controlling, and making decisions. Research on the effects of participatory budgeting on performance has been extensively examined, several research have not shown consistent results. These inconsistent research results may be due to the absence of a simple direct relationship between participatory budgeting and performance (Gul et al, 1995). According to Sardjito and Muthaher (2008), through a contingency approach we can overcome the differences in results from previous studies. This contingency approach is an approach that enables other variables to be an indirect influence factor between participatory budgeting and performance
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