In an experiment, we model two stylized facts about capital budgeting practice, budgetary slack creation and delegation of decision-making authority. In our setting, under centralization, headquarters announces a budget, the division manager gives a cost report, and headquarters decides on the...

Prior research suggests that providing managers with discretion over team bonus allocation can improve team performance because it enhances the relation between team members’ contributions to team output and their rewards. This study investigates whether task interdependence influences...

This paper uses an experiment to investigate the effects of giving subordinates the possibility to return remaining budget to the organization on capital budgeting processes. We predict and find that when subordinates face no uncertainty when they submit their budget request, the possibility to...

Employees’ skill development is key to organizations’ competitiveness in a global, knowledge-based economy. Prior research in accounting, however, has mainly focused on the effects of management control instruments on the provision of transitory effort, thereby treating employee ability as...