Efficient Contracting and the Choice of Accounting Method in the Oil and Gas Industry
34 Pages Posted: 19 Sep 2014
Date Written: January 1, 1990
This paper's results are consistent with the choice of accounting method in the oil and gas industry being dominated by measurable characteristics of firms and guided by the principles of efficient contracting. The results are inconsistent with an alternative hypothesis, opportunistic behavior by managers. The efficient contracting explanation is also consistent with the empirical findings from earlier studies; [e.g., Lilien and Pastena (1982) and Deakin 1979)].
Keywords: Accounting Choice, Efficient Contracting, Full Cost, Successful Efforts
JEL Classification: G3
Suggested Citation: Suggested Citation