Abstract: Some subsistent empirical researches indicate that budget slack is prevalent in organizations.There are two reasonable theories for explaining budget slack:agency theory and contingency theory.At the same time,it is one important character in our transitional economics that state-owned enterprises are influenced administratively by the government.We select budgetary data from the enterprises listed in Shanghai or Shenzhen to research budget slack.Empirical results illuminate:1.Ownership property,ownership structure andfirm size are important expository variables for budget slack.Therefore,agency theory and government influence provide more explanation than contingency theory.2.Tight budget does not have effective incentive effect,but improve manager's motivation to manage earnings.

Key words: budget slack, agency theory, contingency theory, government influence, firm performance