Download this Paper Open PDF in Browser

Neuroaccounting, Part II: Consilience Between Accounting Principles and the Primate Brain

49 Pages Posted: 2 Feb 2009  

John W. Dickhaut

Chapman University (Deceased)

Sudipta Basu

Temple University - Department of Accounting

Kevin A. McCabe

George Mason University - Department of Economics; George Mason University - Antonin Scalia Law School, Faculty

Gregory B. Waymire

Emory University - Goizueta Business School

Date Written: January 30, 2009

Abstract

We develop the hypothesis that culturally evolved accounting principles are ultimately explained by their consilience with how the human brain has biologically evolved to evaluate opportunities for exchange. The primary function of accounting in evaluating exchange is providing information on the net benefits of past exchanges. Accounting's comparative advantage arises because it provides information based on reliable quantified data that is well suited to multi-period settings where reputation and trust are of first-order importance. We review evidence documented by neuroscientists that is consistent with the hypothesis that longstanding accounting principles such as Revenue Realization, Expense Matching, Objectivity, Historical Cost, Going Concern and Conservatism have distinct parallels in brain behaviors. We conclude that NeuroAccounting has important implications for how we think about accounting principles and the ultimate forces behind their emergence and persistence.

Keywords: Accounting principles, economic exchange, neuroeconomics, primate brain

JEL Classification: D80, E11, M40

Suggested Citation

Dickhaut, John W. and Basu, Sudipta and McCabe, Kevin A. and Waymire, Gregory B., Neuroaccounting, Part II: Consilience Between Accounting Principles and the Primate Brain (January 30, 2009). Available at SSRN: https://ssrn.com/abstract=1336517 or http://dx.doi.org/10.2139/ssrn.1336517

John Dickhaut

Chapman University (Deceased)

Sudipta Basu

Temple University - Department of Accounting ( email )

Philadelphia, PA 19122
United States
215.204.0489 (Phone)
215.204.5587 (Fax)

Kevin A. McCabe

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
United States

George Mason University - Antonin Scalia Law School, Faculty ( email )

3301 Fairfax Drive
Arlington, VA 22201
United States

Gregory B. Waymire (Contact Author)

Emory University - Goizueta Business School ( email )

Goizueta Business School
1300 Clifton Road
Atlanta, GA 30322
United States
404-727-6589 (Phone)
404-727-6313 (Fax)

Paper statistics

Downloads
640
Rank
33,297
Abstract Views
2,490