| Budgeting carries behavioral problems that can have important effects on the effectiveness of an organization. The purpose of this dissertation is to investigate whether control (economic) and non-control (psychology) components of procedural justice provide a significant contribution in explaining the relation between budgetary participation and two outcome variables: budget commitment and subordinate performance in a stretch budget condition.; College students perform a task involving basic budgeting decisions. Their main job is to decode as many symbols as possible in a work session under different conditions. Manipulations of voice, choice, group value, and budget type are randomly assigned to the participants. Three dependent variables, which include procedural justice judgments, budget commitment, and performance are measured in this study.; The results show that voice, choice, and group value interact to influence procedural justice judgments. In a stretch budget condition, procedural justice has a mediating effect in the relations between voice, choice, and group value and budget commitment. Moreover, the study finds that in the stretch budget condition, voice, choice, and group value have negative relations with budget commitment, suggesting that budgetary participation creates a behavioral problem.; The analyses fail to support the mediating role of budget commitment in the relation between procedural justice judgments and performance in the stretch budget condition. However, the results show a significant positive relationship between budget commitment and performance, supporting prior research regarding commitment and performance.; Additional analyses of the sample in a fair budget condition reveal interesting results. The results suggest that participants in the fair budget condition do not pay attention to the budgeting process as much as their counterparts do in the stretch budget condition. The participants perceive the budget type as more important than the budgeting process. |
