The role of psychological capital in moderating the effect of budgetary participation on local government performance
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Received April 17, 2025;Accepted July 2, 2025;Published July 25, 2025
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Author(s)Link to ORCID Index: https://orcid.org/0000-0002-0480-0895
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Link to ORCID Index: https://orcid.org/0009-0002-7281-0451 -
DOIhttp://dx.doi.org/10.21511/pmf.14(3).2025.03
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Article InfoVolume 14 2025, Issue #3, pp. 30-43
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Type of the article: Research Article
Abstract
This study aims to examine the effect of budgetary participation, organizational commitment, motivation, and budget transparency on local government performance, with psychological capital as a moderating variable. Budgetary participation refers to the involvement of local government employees in the budgeting process, while psychological capital reflects their optimism, resilience, and confidence in decision-making. This analysis was conducted in Central Java, Indonesia, from June to August 2024 using a quantitative approach. A structured survey was conducted by distributing questionnaires to respondents consisting of 250 employees in local work units involved in financial management, policy implementation, and service provision. After being selected based on their professional knowledge and direct involvement in the governance and budgeting process, 221 respondents were considered valid. Strict ethical guidelines were adhered to in order to protect participants and maintain the integrity of the research process. The results show that budget transparency and motivation significantly improve government performance. Thus, both are important in the governance process. Psychological capital strengthens the influence of budgetary participation, organizational commitment, and budget transparency on local government performance. Motivation has a direct and substantial contribution to local government performance without being moderated by employee psychological traits such as optimism and self-confidence. Employees' motivation drives their performance regardless of their psychological capital. This is in contrast to budgetary participation and organizational commitment, which require psychological support to enhance their effects. This study contributes to governance research in highlighting the psychological aspects of budgetary participation, organizational commitment, and transparency.
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JEL Classification (Paper profile tab)H11, H72, H83, M12
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References39
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Tables4
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Figures2
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- Figure 1. Research model
- Figure 2. Output model
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- Table 1. Validity and reliability
- Table 2. Model fit
- Table 3. Hypotheses testing
- Table A1. Questionnaire
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Conceptualization
Warsito Kawedar
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Data curation
Warsito Kawedar, Rr. Sri Handayani
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Formal Analysis
Warsito Kawedar, Rr. Sri Handayani
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Investigation
Warsito Kawedar, Rr. Sri Handayani
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Methodology
Warsito Kawedar, Rr. Sri Handayani
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Project administration
Warsito Kawedar
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Supervision
Warsito Kawedar
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Validation
Warsito Kawedar, Rr. Sri Handayani
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Writing – original draft
Warsito Kawedar
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Visualization
Rr. Sri Handayani
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Writing – review & editing
Rr. Sri Handayani
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Conceptualization
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Academic resilience, emotional intelligence, and academic performance among undergraduate students
Uzoma Ononye, Mercy Ogbeta , Francis Ndudi
, Dudutari Bereprebofa , Ikechuckwu Maduemezia doi: http://dx.doi.org/10.21511/kpm.06(1).2022.01
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Investigating the impact of workplace bullying on employees’ morale, performance and turnover intentions in five-star Egyptian hotel operations
Ashraf Tag-Eldeen , Mona Barakat , Hesham Dar doi: http://dx.doi.org/10.21511/tt.1(1).2017.01In today’s competitive business environment, human resources are one of the most critical assets particularly for service-focused organizations. Consequently, employees’ morale has become invaluable for maintaining outstanding organizational performance and retaining employees. One of the most important factors which may affect employees’ satisfaction is workplace bullying from employers and colleagues at large. It is considered a negative and unethical issue which may degrade, humiliate and create a risk to a healthy working environment. Therefore, the main objective of this research is to investigate the extent to which workplace bullying may affect the organizational outcomes of a sample of five-star hotels in Egypt. Two questionnaires were distributed among the subjects of the sample; bell desk staff, kitchen stewards and head departments. The results of this research confirmed that there is a correlation between workplace bullying, employees’ morale and turnover intentions but, showed no correlation between workplace bullying and employees’ work performance.
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Corporate governance and financial performance: an empirical analysis of selected multinational firms in Nigeria
Gideon Tayo Akinleye , Odunayo Olarewaju, Bamikole Samson Fajuyagbe doi: http://dx.doi.org/10.21511/ppm.17(1).2019.02
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