The coordinating role of budgetary participation : rationalistic and institutional perspectives

Abstract

This paper investigates the role of budgetary participation in resolving interdepartmental coordination problems, which has received little empirical attention in the budgetary literature. Both qualitative and quantitative methods are used for exploring this issue. Two dimensions of budgetary participation (participation in budget-setting and more frequent participation initiated by subordinate managers) and their interactions with various types of task interdependence and institutional pressure are examined. The findings largely support the argument that institutional theory and more rationalistic approaches, focusing on the instrumental function of budgets, provide complementary explanations of the coordinating role of budgetary participation. Keywords: budgetary participation, contingency theory, coordination, institutional pressure, institutional theory, task interdependence, triangulation.