Budget Goal Commitment and Informational Effects of Budget Participation on Performance: A Structural Equation Modeling Approach

This paper examines budget goal commitment and informational effects of budget participation on performance. A structural model is proposed and tested that includes budget participation, budget goal commitment, job‐relevant information, and job performance variables. The data were collected by survey questionnaires. Seventy‐nine middle‐level managers, drawn randomly from a cross‐section of manufacturing companies in Australia, participated in the project. A structural equation modeling technique was used to test hypothesized linkages. Support was found for the effects of budget goal commitment and informational roles of budget participation on job performance.