STRATEGY, BUDGETING, AND CRISIS IN LATIN-AMERICA

This empirical study investigated the relationship between business st rategy and budgetary usage, given perceived crisis in Latin America. U sing Miles and Snow's (1978) strategy typology, it was hypothesized th at the Defender and Reactor strategy usage would be positively associa ted with Crisis while the Prospector and Analyzer strategy usage would be negatively associated. Employing LISREL analytic techniques, study results supported these relationships (although an alternate analysis supports the possibility that Defenders and Prospectors enact their s trategy to be consistent with their Crisis perceptions). Further, thou gh relationships between all strategy types should be related to Budge tary Usage, results indicated that the only significant relationship w as between Prospector and Budgetary Usage. Though these results are co nsistent with the literature and have implications for budgeting pract ice in Latin America, additional research is needed. (C) 1997 Elsevier Science Ltd.