Empirical Research on Accounting Choice
74 Pages Posted: 1 Feb 2001
There are 2 versions of this paper
Empirical Research on Accounting Choice
Date Written: January 30, 2001
Abstract
We review research from the 1990s that examines the determinants and consequences of accounting choice, structuring our analysis around the three types of market imperfections that influence managers? choices: agency costs, information asymmetries, and externalities affecting noncontracting parties. We conclude that research in the 1990s made limited progress in expanding our understanding of accounting choice because of limitations in research design and a focus on replication rather than extension of current knowledge. We discuss opportunities for future research, recommending the exploration of the economic implications of accounting choice by addressing the three different reasons why accounting matters.
JEL Classification: M41, M43, M44
Suggested Citation: Suggested Citation
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