The Moderating Effect of Monitoring on The Relationship Between Adverse Selection and Decision-Making Involving Escalation Situations: An Experimental Study
Abstract
The streams of research on adverse selection and escalation of commitment are still inconclusive and limited by only manipulating adverse selection in 2 conditions, namely the presence and absence of adverse selection. Meanwhile, the literature shows that adverse selection will always exist in agency contracts even though the information asymmetry mechanism has been modified. This study considers adverse selection manipulation into two levels: high and low. This research investigates the moderating effect of supervision on the impact of adverse selection and commitment escalation. This research used an experimental method with a 2 x 2 factorial design between subjects. This study involved undergraduate accounting students as extension practitioners. The test results show that different levels of adverse selection impact levels of commitment escalation. The research also indicates that supervision is quite effective in filtering the impact of adverse selection on commitment escalation behavior
References
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Rohma, F. F. (2019). Analisis biaya dan manfaat aliran kas investor: Telaah literatur kewajaran dari nilai wajar. Jurnal Penelitian Teori & Terapan Akuntansi (PETA), 4(2), 49–65. https://doi.org/10.51289/peta.v4i2.402
Rohma, F. F. (2021). The moderating effect of proactive personality on role ambiguity and user satisfaction : an experimental under technostress condition. Jurnal Riset Akuntansi Dan Keuangan Indonesia, 6(3).
Rohma, F. F. (2022). Mitigating the harmful effect of slack: does locus of commitment (organizational versus colleague) play a role?. 17(3), 1–12.
Rohma, F. F., & Zakiyah, R. D. (2022). Retaliation, obedience pressure, and investigative decisions on whistle- blowing allegations: An experimental study. Jurnal Dinamika Akuntansi, 14(2), 156–166.
Rosana, K., & Handoko, J. (2021). Effect of hurdle rate and confidence on commitment esacalation. Journal of Accounting, Entrepreneurship and Financial Technology, 3(1), 1–14.
Sa’diyah, H., Mahsuni, A. W., & Mawardi, M. C. (2018). Pengaruh informasi akuntansi terhadap pengambilan keputusan (eskalasi komitmen). Jurnal Ilmiah Riset Akuntansi, 7(01).
Sampouw, C. E. (2018). Experimental study : The influence of pay scheme and personalvalue to budgetary slack. Journal of Applied Management (JAM), 16(4), 614–621.
Sari, D. P., & Rahman, A. (2022). Enrichment : journal of management negative effects of framing and adverse selection on the commitment escalation in investment decision making. 12(5).
Sari, N. K. A. P., & Wirakusuma, M. G. (2016). Pengaruh adverse selection dan negative framing pada kecenderungan eskalasi komitmen. E-Jurnal Ekonomi Dan Bisnis, 5(3), 573–600.
Sari, R., & Dewanti, P. W. (2019). The effect of negative framing and risk preference in the adverse selection condition toward escalation of commitment. Jurnal Kajian Pendidikan Akuntansi Indonesia (KPAI), 8(4), 1–13.
Simbolon, E. (2020). Pengaruh pengendalian internal dan komitmen organisasi terhadap penceghan kecurangan pada inspektorat kabupaten Labuhanbatu. Jurnal Komitmen Organisasi, 10, 1–57.
Staw, B. M. (1997). The Escalation of Commitment: An update and Appraisal. Organizational Decision Making, 191–215.
Wahyudi, T., Yusnaini, Y., & Novriansa, A. (2021). The role of ethical environment in reducing escalation of commitment bias. Sriwijaya International Journal Of Dynamic Economics And Business, 4(2), 129–138.
Warliana, L., & Abdullah, M. W. (2021). The role of ethical environment in reducing escalation of commitment bias. El Barka Jouranl of Islamic Economic and BUsiness, 4(2), 257–281.
Wolk, H. I., Dodd, J. L., & Rozicky, J. J. (2016). Accounting Theory Conceptual Issues in a Political and Economic Environment (9 Edition). SAGE Publication.
Yani, F., Rodiah, S., & Azmi, Z. (2019). Pengaruh adverse selection dan locus of control terhadap kecenderungan eskalasi komitmen dalam pengambilan keputusan investasi. Jurnal Akuntansi Dan Ekonomika, 9(2), 204–212.
Apriwandi, Naufa, A. M., & Arifa, C. (2021). Who is the boss ? de-escalation of commitment strategy : effectiveness of share responsibility and superiors’ feedback an experimental investigation Turkish journal of computer and mathematics education research article. Turkish Journal of Computer and Mathematics Education, 12(8), 1349–1357.
Berg, J. E., Dickhaut, J. W., & Kanodia, C. (2009). The role of information asymmetry in escalation phenomena: Empirical evidence. Journal of Economic Behavior and Organization, 69(2), 135–147. https://doi.org/10.1016/j.jebo.2007.07.007
Bintang, V., Susbiyani, A., & Syahfrudin, A. (2020). Eskalasi komitmen berdasarkan informasi investasi, kondisi adverse selection dan job rotation. Budgeting : Journal of Business, Management and Accounting, 2(1), 283–293. https://doi.org/https://doi.org/10.31539/budgeting.v2i1.1237
Bone, H. (2020). Dampak keterlibatan dan monitoring terhadap kecenderungan untuk melakukan eskalasi komitmen. Akuntabilitas, 13(1), 1–10. https://doi.org/10.15408/akt.v13i1.14486
Chong, V. K., & Suryawati, R. F. (2011). The effect of job rotation policy in preventing managerial escalation of commitment. International Journal of Accounting, Auditing and Performance Evaluation, 7(3), 176–199. https://doi.org/10.1504/IJAAPE.2011.040833
Chulkov, D. V., & Barron, J. M. (2021). Escalation of commitment and CEO departures: theory and evidence. Journal of Business Economics and Management, 22(6).
Dwita, S. (2007). The Influence of adverse selection and negative framing on escalation of commitment in project evaluation decision. Simposium Nasional Akuntansi X.
Jasrul, N. A. (2015). Pengaruh gaya kepemimpinan manajer dan keefektifan monitoring control terhadap eskalasi komitmen dalam pengambilan keputusan investasi. Nominal, Barometer Riset Akuntansi Dan Manajemen, 4(1). https://doi.org/10.21831/nominal.v4i1.6891
Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3, 77–132. https://doi.org/https://doi.org/10.4159/9780674274051-006
Kusufi, M. S., Rohma, F. F., & Muhammad, E. (2020). Pengaruh horizon skema turnamen dan frekuensi publikasi informasi relatif terhadap kinerja karyawan. Jurnal Kajian Akuntansi, 4(1), 1. https://doi.org/10.33603/jka.v4i1.3161
Maulita, M. (2019). Pengaruh ketersediaan informasi publik dan monitoring control terhadap hubungan antara self efficacy dan escalation of commitment. Media Riset Akuntansi, Auditing & Informasi, 19(2), 227–248.
Nahartyo, E. (2012). Desain dan Implementasi Riset Eksperimen. Yogyakarta: UPP STIM YKPN.
Nahartyo, E., Rohma, F. F., & Mursita, L. Y. (2020). The mediating effect of overcompensation of rationalisation on instrumental climate and escalation of corruption relationship. Asian Academy of Management Journal, 25(2), 1–21. https://doi.org/10.21315/aamj2020.25.2.1
Nahartyo, E., & Utami, I. (2016). Panduan Praktis Riset Eksperimen. Jakarta : Indeks.
Narsa, I. M., & Narsa, N. P. D. R. H. (2021). The effect of adverse selection and psychological capital on decision making involving escalation situations: An experimental study. Jurnal Ilmiah Akuntansi, 6(1), 1–21. https://doi.org/10.23887/jia.v6i1.30239
Nasution, S. Z. H., & Suryawati, R. F. (2020). Pengaruh adverse selection dan negative framing terhadap eskalasi komitmen dalam pengambilan keputusan investasi. Jurnal Manajemen Dan Organisasi (JMO), 10(3), 197–206. https://doi.org/10.29244/jmo.v10i3.30153
Prihatini, D. (2021). Pengaruh adverse selection, negative framing dan gaya kepemimpinan terhadap eskalasi komitmen (studi kasus pada mahasiswa prodi pkuntansi fakultas ekonomi dan bisnis unversitas Tanjungpura Pontianak). JAAKFE UNTAN Jurnal Audit Dan Akuntansi Fakultas Ekonomi Universitas Tanjungpura, 10(1), 19–43.
Rachmawati, D., & Budianto, P. F. (2022). The determinants of commitment escalation (Experimental study: Covid-19 pandemic as a contextual). Jurnal Akuntansi, 12(1), 13–22. https://doi.org/10.33369/j.akuntansi.12.1.13-22
Ridha, M. A. (2019). Hurdle rate and adverse selection on escalation of commitment. Shirkah: Journal of Economics and Business, 3(2). https://doi.org/10.22515/shirkah.v3i2.202
Ridhawati, R., Maryana, F., & Fitriana, A. (2018). Pengaruh gaya kepemimpinan manajer dan monitoring control terhadap eskalasi komitmen dalam pengambilan keputusan persetujuan pengajuan kredit sepeda motor (studi kasus pada PT Delta Abadisentosa). Dinamika Ekonomi Jurnal Ekononomi Dan Bisnis, 11(1), 1–11.
Rohma, F. F. (2019). Analisis biaya dan manfaat aliran kas investor: Telaah literatur kewajaran dari nilai wajar. Jurnal Penelitian Teori & Terapan Akuntansi (PETA), 4(2), 49–65. https://doi.org/10.51289/peta.v4i2.402
Rohma, F. F. (2021). The moderating effect of proactive personality on role ambiguity and user satisfaction : an experimental under technostress condition. Jurnal Riset Akuntansi Dan Keuangan Indonesia, 6(3).
Rohma, F. F. (2022). Mitigating the harmful effect of slack: does locus of commitment (organizational versus colleague) play a role?. 17(3), 1–12.
Rohma, F. F., & Zakiyah, R. D. (2022). Retaliation, obedience pressure, and investigative decisions on whistle- blowing allegations: An experimental study. Jurnal Dinamika Akuntansi, 14(2), 156–166.
Rosana, K., & Handoko, J. (2021). Effect of hurdle rate and confidence on commitment esacalation. Journal of Accounting, Entrepreneurship and Financial Technology, 3(1), 1–14.
Sa’diyah, H., Mahsuni, A. W., & Mawardi, M. C. (2018). Pengaruh informasi akuntansi terhadap pengambilan keputusan (eskalasi komitmen). Jurnal Ilmiah Riset Akuntansi, 7(01).
Sampouw, C. E. (2018). Experimental study : The influence of pay scheme and personalvalue to budgetary slack. Journal of Applied Management (JAM), 16(4), 614–621.
Sari, D. P., & Rahman, A. (2022). Enrichment : journal of management negative effects of framing and adverse selection on the commitment escalation in investment decision making. 12(5).
Sari, N. K. A. P., & Wirakusuma, M. G. (2016). Pengaruh adverse selection dan negative framing pada kecenderungan eskalasi komitmen. E-Jurnal Ekonomi Dan Bisnis, 5(3), 573–600.
Sari, R., & Dewanti, P. W. (2019). The effect of negative framing and risk preference in the adverse selection condition toward escalation of commitment. Jurnal Kajian Pendidikan Akuntansi Indonesia (KPAI), 8(4), 1–13.
Simbolon, E. (2020). Pengaruh pengendalian internal dan komitmen organisasi terhadap penceghan kecurangan pada inspektorat kabupaten Labuhanbatu. Jurnal Komitmen Organisasi, 10, 1–57.
Staw, B. M. (1997). The Escalation of Commitment: An update and Appraisal. Organizational Decision Making, 191–215.
Wahyudi, T., Yusnaini, Y., & Novriansa, A. (2021). The role of ethical environment in reducing escalation of commitment bias. Sriwijaya International Journal Of Dynamic Economics And Business, 4(2), 129–138.
Warliana, L., & Abdullah, M. W. (2021). The role of ethical environment in reducing escalation of commitment bias. El Barka Jouranl of Islamic Economic and BUsiness, 4(2), 257–281.
Wolk, H. I., Dodd, J. L., & Rozicky, J. J. (2016). Accounting Theory Conceptual Issues in a Political and Economic Environment (9 Edition). SAGE Publication.
Yani, F., Rodiah, S., & Azmi, Z. (2019). Pengaruh adverse selection dan locus of control terhadap kecenderungan eskalasi komitmen dalam pengambilan keputusan investasi. Jurnal Akuntansi Dan Ekonomika, 9(2), 204–212.
Published
2024-09-30
How to Cite
ROHMA, Frida Fanani; FITRIYAH, Anik; ZULFATILLAH, Auliya.
The Moderating Effect of Monitoring on The Relationship Between Adverse Selection and Decision-Making Involving Escalation Situations: An Experimental Study.
Klabat Accounting Review, [S.l.], v. 5, n. 2, p. 102-110, sep. 2024.
ISSN 2722-7278.
Available at: <https://ejournal.unklab.ac.id/index.php/kar/article/view/1158>. Date accessed: 14 dec. 2024.
doi: https://doi.org/10.60090/kar.v5i2.1158.102-110.
Section
Articles
This work is licensed under a Creative Commons Attribution 4.0 International License.
