MANAGERIAL ACCOUNTING RESEARCH 313
and make the latter ‘‘the responsibility of the capitalist’’ (Braverman 1974, 57).
However, treating human beings as just another factor of production sets the stage
for the exploitation and expropriation of labor by capital. Accordingly, there is an
irreducible conflict between capital and labor ensuring perpetually antagonistic
relations between the classes. It is on this backdrop of capitalist social relations
that the labor process perspective on cost and managerial accounting is fleshed
out (see also Edwards 1979; Burawoy 1979; Noble 1977; Clawson 1980).
Hopperet al.(1987) introduced the labor process perspective to accounting by
contrasting this perspective from both functional and interpretative understand-
ings of managerial accounting. Their central argument was that management
accounting cannot be properly understood, except in the light of the social rela-
tions of production. They argued that to view organizations as united by a common
purpose is to fictionalize what is, in fact, a site of irreconcilable conflict. Such orga-
nization goals as the maximization of the net present value of future cash flows
transforms what is the goal of one sectional interest into the overriding goal of
all, thus obscuring the class-based distributional conflicts inherent in all capitalist
organizations.
Accordingly, labor process theorists deny that management accounting is a
neutral tool serving the general interests of efficiency and emphasize its role
in legitimizing partisan interests, in contributing to the control and domination
of labor, and in reinforcing the dominant mode of production, i.e., capitalist
production, albeit in a contested terrain. Moreover, management accounting also
is capable of showing up the ambiguous position of managers within capitalist
firms. Where on the one hand, they are ‘‘materially privileged’’ agents of the
capitalists’ class and must accordingly serve the interests of the latter, they are
on the other hand, wage labor and to that extent interested in ‘‘securing their
own employment, and in fighting for an improved share of available resources’’
(Hopperet al.1987, 450 – 451). Thus, managers are at once ‘‘both agents and victims
of control’’ such that phenomena such as budget games and divisional budgeting
slack must not be seen as the consequence of some ‘‘individual pathology’’ but
rather as the ‘‘deep effects of exploitative and oppressive social structures’’ that
are embedded and presupposed in the capitalist system of production.
While Hopperet al.(1987) offered a programmatic introduction to the labor
process perspective and distinguish it from the more functionalist and interpretive
traditions, a later paper by Hopper and Armstrong (1991) presented a historically
rooted reflection on the development of management and cost accounting since
the middle of the nineteenth century, in part by challenging the very popular
reading of the history of cost and managerial accounting given by Johnson and
Kaplan (1987) (see also Johnson 1972, 1981, 1983). Deploying a transactions-cost
approach, Johnson and Kaplan (1987) argued for understanding the emergence
and prevalence of cost accounting as techniques which contributed to increasing
operational efficiencies, and for ROI and budgets as techniques which reduced the
costs of managing large vertically integrated bureaucracies as opposed to securing
market-based coordination. In contrast, Hopper and Armstrong (1991) challenged
this interpretation by linking the presence and even subsequent absence of cost