A Behavioral Model of Budgetary Slack: The Roles of Participative Budgeting, Social Pressure, and Machiavellianism with the Moderating Role of Political Skill
DOI:
https://doi.org/10.38035/dijefa.v7i3.7080Keywords:
budgetary slack, Machiavellianism, participative budgeting, political skill, social pressureAbstract
Despite extensive research on budgetary slack, limited evidence exists regarding the combined influence of budgeting mechanisms, social pressures, and individual characteristics. This study investigates the effects of participative budgeting, social pressure, and Machiavellianism on budgetary slack and examines whether political skill moderates these relationships. Using a cross-sectional survey, data were collected from lower- and middle-level managers of a Regional Development Bank in Indonesia. Data from 221 valid responses were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings reveal that participative budgeting, social pressure, and Machiavellianism positively and significantly influence budgetary slack, although the effect of participative budgeting is contrary to the proposed hypothesis. Political skill does not moderate these relationships but exerts a positive and significant direct effect on budgetary slack. These findings contribute to the behavioral accounting literature by demonstrating that budgetary slack is jointly shaped by budgeting mechanisms, social pressures, and individual characteristics, while political skill functions as a direct predictor rather than a moderating mechanism.
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