Lock-up provision and performance of IPOs: Effect of information asymmetry

2014 ◽  
pp. 141-146
Keyword(s):  
Information Asymmetry ◽  
And Performance

A Theory of Participative Budgeting

2013 ◽  
Vol 89 (3) ◽  
pp. 1025-1050 ◽  
Author(s):  
Mirko S. Heinle ◽  
Nicholas Ross ◽  
Richard E. Saouma
Keyword(s):  
Information Asymmetry ◽  
Private Information ◽  
Agency Costs ◽  
Top Down ◽  
Maximal Level ◽  
Bottom Up ◽  
Budgetary Slack ◽  
Participative Budgeting ◽  
And Performance ◽  
Budgeting Process

ABSTRACT This paper complements the ongoing empirical discussion surrounding participative budgeting by comparing its economic merits relative to a top-down budgeting alternative. In both budgeting regimes, private information is communicated vertically between a principal and a manager. We show that top-down budgeting incurs fewer agency costs than bottom-up budgeting whenever the level of information asymmetry is relatively low. Although the choice between top-down and bottom-up budgeting ultimately determines who receives private information within the firm, we find that both the principal and manager's preferences over the allocation of private information remain qualitatively similar across the two budgeting paradigms. Specifically, while the principal always prefers either minimal or maximal private information, the manager prefers an interim or maximal level of private information regardless of who is privately informed. Last, we use our model to address empirical inconsistencies relating the firm's choice of budgeting process, the resulting budgetary slack, and performance.

Using importance–performance analysis to bridge the information gap between industry and higher education

2019 ◽  
Vol 33 (4) ◽  
pp. 223-227 ◽  
Author(s):  
Olivia Wohlfart ◽  
Gregor Hovemann
Keyword(s):  
Higher Education ◽  
Performance Analysis ◽  
Strategic Management ◽  
Information Asymmetry ◽  
Performance Measures ◽  
Sport Management ◽  
Advantages And Disadvantages ◽  
Information Gap ◽  
And Performance ◽  
Management Recommendations

The goal of this viewpoint article is to introduce, critically analyse and further develop importance–performance analysis (IPA) as a framework through which strategic management recommendations can be extracted for higher education institutions. The article introduces a new method of combining the perspectives of two significant groups to bridge the information gap between industry and higher education by exploring the results of two differing IPA variants from the context of sport management. The first IPA matches the importance and performance of future competencies based on statements solely derived from the labour market. The second explores the same importance measures in comparison to performance measures derived from current graduates. The authors discuss the advantages and disadvantages of each analysis and recommend the use of this framework in the effort to decrease the existing information asymmetry between industry and higher education.

A study of performance model development and good governance budgeting

2021 ◽  
Vol 63 (3) ◽  
pp. 301-319
Author(s):  
Haliah Haliah
Keyword(s):  
Information Asymmetry ◽  
Local Governments ◽  
Good Governance ◽  
Positive Relationships ◽  
Budgetary Slack ◽  
Content Type ◽  
And Performance ◽  
Relationship Of ◽  
The Relationship ◽  
Structural Coefficient

Purpose The purpose of this study is to empirically examine the influence of politics, culture and regulation on the budgetary slack and its impact on performance. Specifically, the purpose of this study is to analyze the influence of culture, politics and regulation on budgetary slack and performance in local government. Design/methodology/approach Studies to develop model pengangaran good (good governance budgeting). Using the survey method. The total sample is 300 respondents in seven local governments in West Sulawesi. Respondents from the executive and legislative participate in the preparation of budgets in local government. The research instrument in questionnaire is tested using GSCA. Findings The third structural coefficient of the relationship is positive, indicating all three positive relationships. That is, the higher political, cultural, regulatory, will result in the higher budgetary slack. Thus, if one wants to reduce the budgetary slack, then one needs to reduce the problems of politics, culture and regulations. Other results obtained (a) significant political, cultural and regulatory effect on performance either directly or indirectly through budgetary slack. The sixth structural coefficient of the relationship is positive, indicating all six positive relationships. That is, the higher political, cultural and regulatory variables will lead to higher performance either directly or indirectly through budgetary slack; (b) information asymmetry and budgetary slack significantly affect performance. The second structural coefficient correlation is positive, indicating both positive relationships. That is, the higher information asymmetry and budgetary slack will result in higher performance; (c) budgeting participation moderating influence budgetary slack variables that are false and strengthen moderation. That is, the higher the value of participation budgeting (M) affects increasing influence through budgetary slack (Y1) on the performance (Y2). Research limitations/implications The results showed that the political, cultural and regulatory variables significantly affect the budgetary slack. The structural coefficient of the relationship of these three variables had positive-marked, indicating that the relationship of all those three was positive. Thus, the higher political, cultural and regulatory variables will result in higher budgetary slack. Political, cultural and regulatory variables significantly affected the performance both directly and indirectly through budgetary slack. Structural coefficient of the relationship of those six had positive-marked, indicating that the relationship of all those six was positive. Thus, the higher political, cultural and regulatory variables will lead to higher performance both directly and indirectly through budgetary slack. Originality/value This paper conducts a research on mediation effect of budgetary slack in relationship between politics, culture and regulation toward performance; this research retests the research result from Fisher (2002) about information asymmetry and performance, Rubin (1993) about political, budgetary slack and performance, Scott (2000) about regulatory, budgetary slack and performance, Indriantoro (2000) about mediation of budgetary slack in relationship between politics, culture and regulation toward performance and Mardiasmo (2005) about budgetary slack and performance. No studies have examined this kind of relationship simultaneously. location of study (no previous research for this relationship): local governments in West Sulawesi.

Budgetary Participation in Turkey: The Effects of Information Asymmetry, Goal Commitment, and Role Ambiguity on Job Satisfaction and Performance

2012 ◽  
Vol 12 (1) ◽  
pp. 29-54 ◽  
Author(s):  
Johnny Jermias ◽  
Fatih Yigit
Keyword(s):  
Job Satisfaction ◽  
Information Asymmetry ◽  
Role Ambiguity ◽  
Goal Commitment ◽  
Institutional Factors ◽  
Budgetary Process ◽  
Budgetary Participation ◽  
And Performance ◽  
The Impact ◽  
Budgeting Process

ABSTRACT This study empirically investigates the antecedent, mediating, and outcome variables of budgetary participation in Turkey. Turkey is an interesting setting to investigate the impact of budgetary participation on job satisfaction and performance because of its unique cultural and institutional factors. We propose that the information asymmetry between superiors and subordinates creates the need for budgetary participation, and the outcomes of budgetary participation (i.e., job satisfaction and performance) will be mediated by goal commitment and role ambiguity. Based on a questionnaire survey of 194 mid-level managers in Turkey, we find that role ambiguity mediates the budgetary participation–job satisfaction and budgetary participation-performance relationships. The results are consistent with the view that the primary benefit of budgetary participation is to decrease role ambiguity, leading to more job satisfaction and better performance. Furthermore, we find that goal commitment mediates the budgetary participation-performance relationship. This result suggests that participation in the budgeting process increases goal commitment, which in turn leads to better performance. This study will be beneficial for companies in general and for organizations in developing countries in particular to realize that budgetary participation alone does not improve job satisfaction and performance. Rather, it is the increased commitment and decreased role ambiguity that results from managers' participation in the budgetary process that improves job satisfaction and performance. JEL Classifications: D21, G32, L1, M41.

Information asymmetry and performance tilting in hospitals: a national empirical study

2010 ◽  
Vol 20 (12) ◽  
pp. 1487-1506 ◽  
Author(s):  
Jong-Yi Wang ◽  
Janice C. Probst ◽  
Carleen H. Stoskopf ◽  
Jimy M. Sanders ◽  
James F. McTigue
Keyword(s):  
Empirical Study ◽  
Information Asymmetry ◽  
And Performance

Transparency and Executive Compensation

2014 ◽  
pp. 412-433
Author(s):  
Raghavendra Rau
Keyword(s):  
Moral Hazard ◽  
Information Asymmetry ◽  
Executive Compensation ◽  
Adverse Selection ◽  
Agency Problems ◽  
And Performance

There are two major types of agency problems: adverse selection and moral hazard. Changing the transparency of executive compensation is one solution to reducing the two agency problems. I define transparency as any mechanism that reduces the information asymmetry between executives and investors. In this chapter, I discuss how executive compensation is structured, and discuss major regulations that have affected compensation. Finally, I examine how increasing the transparency of these schemes affects the pay level and performance relationship to the executives and how executives modify their behavior to affect transparency as a result of their pay structure.

Using Budgets for Performance Evaluation: Effects of Resource Allocation and Horizontal Information Asymmetry on Budget Proposals, Budget Slack, and Performance

2002 ◽  
Vol 77 (4) ◽  
pp. 847-865 ◽  
Author(s):  
Joseph G. Fisher ◽  
Laureen A. Maines ◽  
Sean A. Peffer ◽  
Geoffrey B. Sprinkle
Keyword(s):  
Resource Allocation ◽  
Performance Evaluation ◽  
Information Asymmetry ◽  
Managerial Accounting ◽  
Compensation Plans ◽  
Scarce Resources ◽  
Subordinate Performance ◽  
Business Executives ◽  
And Performance ◽  
And Control

Business executives and academics frequently criticize budget-based compensation plans as providing incentives for subordinates to build slack into proposed budgets. In this paper, we examine whether either of two practices—using budgets to allocate scarce resources, or providing information about co-workers—reduces budget slack and increases subordinate performance when organizations use budgets for performance evaluation. The results from our experiment show that using budgets for both resource allocation and performance evaluation not only eliminates budget slack, but also increases subordinates' effort and task performance. Additionally, we find that an internal reporting system that provides information about subordinates' budgets and performance to their co-workers mitigates budget slack when superiors do not use budgets as a basis for resource allocation. These results highlight the synergies between the planning (resource allocation) and control (performance evaluation) functions of managerial accounting practices such as budgeting. Our results also suggest that by designing the internal information system to reduce information asymmetry among subordinates, the firm can increase subordinates' incentives to provide more accurate budgets.

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