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Public And Private Forms Of Opportunism Within The Organization: A Joint Examination Of Budget And Effort Behavior, Jeffrey W. Schatzberg, Douglas E. Stevens

Accountancy Faculty Publications

We assert that some forms of opportunistic behavior within the organization are relatively transparent and, therefore, public in nature. Further , while organizations can tightly control such public opportunism, it may not be optimal for them to do so in the presence of private opportunism. To study how public and private forms of opportunism differ and interact, we jointly examine budget and effort behavior in a participative budgeting experiment. We group participants into producer /manager pairs and set the parameters such that the producer extracts the largest share of surplus from the manager by publicly setting the budget at zero …