Can Psychological Capital, Leadership Style, and Environmental Complexity Lower the Company’s Budget Game?

Abstract

Budget games almost happen to all companies in this world, be it government companies or private companies. This budget game is very detrimental and can reduce the performance of the company. Therefore, the company must make various efforts so that the budget game does not occur because it is very detrimental. This study will analyze the effect of psychological capital, leadership style, and environmental complexity on budget gaming. This study uses a sample of 125 respondents spread across various types of manufacturing sub-industry in Indonesia. The research method used is verificative research and is explanatory research with an analytical method using Structural Equation Modeling (SEM) using variance-based analysis techniques, namely Partial Least Square (PLS). The test results show that psychological capital has a negative effect on the gaming budget of -0.339, leadership style has a negative effect on the gaming budget of -0.25, and environmental complexity has a negative effect on the gaming budget of -0.236. This shows that with the existence of psychological capital, leadership style, and environmental complexity in manufacturing companies in Indonesia, it will be able to reduce the occurrence of budget gaming in these companies.

Keywords: Leadership Style, and budget gaming, environmental complexity, psycology capital

Article Review Status: Published

Pages: 17-37 (Download PDF)

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