-
Where Does the Time Go? Auditors’ Commercial Effort, Professional Effort, and Audit Quality Journal of Accounting Research (IF 4.9) Pub Date : 2024-08-17 WILLIAM A. CICONTE, JUSTIN LEIBY, MARLEEN WILLEKENS
Audit theory and regulation assumes that auditors’ commercial motivation threatens audit quality. In this registered report, we use data from two Big Four firms in the Netherlands and provide empirical evidence on the relation between auditors’ commercial motivation and (1) compensation, (2) total audit effort, and (3) audit quality. We proxy commercial motivation as the time that individual auditors
-
Issue Information ‐ Standing Call for Proposals for Journal of Accounting Research (IF 4.9) Pub Date : 2024-07-19
-
-
Issue Information ‐ Request for Papers Journal of Accounting Research (IF 4.9) Pub Date : 2024-07-19
-
Just Friends? Managers’ Connections to Judges Journal of Accounting Research (IF 4.9) Pub Date : 2024-07-13 STERLING HUANG, SUGATA ROYCHOWDHURY, EWA SLETTEN, YANPING XU
We study the impact of social connections between judges and executives on the outcomes of Securities Class Action Litigation (SCAL). Judges who are socially connected to a firm's executives are significantly more likely to dismiss lawsuits against the firm. There is also evidence of faster resolution and lower payout amounts in connected cases. The favorable outcomes cannot be explained by the lower
-
The Decision Relevance of Loan Fair Values for Depositors Journal of Accounting Research (IF 4.9) Pub Date : 2024-07-11 QI CHEN, RAHUL VASHISHTHA, SHUYAN WANG
Using a large sample of U.S. commercial banks from 1994 to 2019, we find that loan fair values are highly relevant for depositor decision making. A one‐standard‐deviation decrease in loan fair value performance is associated with more than 10% lower uninsured deposit flows than the sample average. Information in fair values about loan credit quality is quite limited and cannot account for the bulk
-
Show Your Hand: The Impacts of Fair Pricing Requirements in Procurement Contracting Journal of Accounting Research (IF 4.9) Pub Date : 2024-07-03 BRAD NATHAN
This paper studies how a federal procurement regulation, known as the Truth in Negotiations Act (TINA), affects the competitiveness and execution of government contracts. TINA stipulates how contracting officials (COs) can ensure reasonable prices. Following TINA, for contracts above a certain size threshold, COs can no longer rely solely on their own judgment that a price is reasonable. Instead, they
-
News Bias in Financial Journalists’ Social Networks Journal of Accounting Research (IF 4.9) Pub Date : 2024-06-18 GUOSONG XU
Connected financial journalists—those with working relationships, common school ties, or social media connections to company management—introduce a marked media slant into their news coverage. Using a comprehensive set of newspaper articles covering mergers and acquisition (M&A) transactions from 1997 to 2016, I find that connected journalists use significantly fewer negative words in their coverage
-
Using and Interpreting Fixed Effects Models Journal of Accounting Research (IF 4.9) Pub Date : 2024-06-13 MATTHIAS BREUER, ED DEHAAN
Fixed effects (FE) have emerged as a ubiquitous and powerful tool for eliminating unwanted variation in observational accounting studies. Unwanted variation is plentiful in accounting research because we often use rich data to test precise hypotheses derived from abstract theories. By eliminating unwanted variation, FE reduce concerns that omitted variables bias our estimates or weaken test power.
-
Government Subsidies and Corporate Misconduct Journal of Accounting Research (IF 4.9) Pub Date : 2024-05-18 ANEESH RAGHUNANDAN
I study whether firms that receive targeted U.S. state-level subsidies are more likely to subsequently engage in corporate misconduct. I find that firms are more likely to engage in misconduct in subsidizing states, but not in other states that they operate in, after receiving state subsidies. Using data on both federal and state enforcement actions, and exploiting the legal principle of dual sovereignty
-
Issue Information ‐ Request for Registered Reports Journal of Accounting Research (IF 4.9) Pub Date : 2024-05-11
-
Issue Information ‐ Standing Call for Proposals for Journal of Accounting Research (IF 4.9) Pub Date : 2024-05-11
-
-
Issue Information ‐ Request for Papers Journal of Accounting Research (IF 4.9) Pub Date : 2024-05-11
-
The Effects of Mandatory ESG Disclosure Around the World Journal of Accounting Research (IF 4.9) Pub Date : 2024-05-04 PHILIPP KRUEGER, ZACHARIAS SAUTNER, DRAGON YONGJUN TANG, RUI ZHONG
We compile a novel data set on mandatory environmental, social, and governance (ESG) disclosure around the world to analyze the stock liquidity effects of such disclosure mandates. We document a positive effect of ESG disclosure mandates on firm‐level stock liquidity. The effects are strongest if the disclosure requirements are implemented by government institutions, not on a comply‐or‐explain basis
-
Relative Performance Evaluation and Strategic Peer-Harming Disclosures Journal of Accounting Research (IF 4.9) Pub Date : 2024-05-02 MATTHEW J. BLOOMFIELD, MIRKO S. HEINLE, OSCAR TIMMERMANS
Many firms use relative stock performance to evaluate and incentivize their CEOs. We document that such firms routinely disclose information that harms their peers' stock prices, and sometimes explicitly mention the harmed peers, by name, in these disclosures. Consistent with deliberate sabotage, peer-harming disclosures appear to be aimed at peers whose stock price depressions are most likely to benefit
-
The Capital Market Effects of Centralizing Regulated Financial Information Journal of Accounting Research (IF 4.9) Pub Date : 2024-04-29 GURPAL SRAN, MARCEL TUIJN, LAUREN VOLLON
We study the capital market effects of information centralization by exploiting the staggered implementation of digital storage and access platforms for regulated financial information (Officially Appointed Mechanisms, or OAMs) in the European Union. We find that the implementation of OAMs results in significant improvements in capital market liquidity, consistent with the notion that OAMs lower investors'
-
Bridging Theory and Empirical Research in Accounting Journal of Accounting Research (IF 4.9) Pub Date : 2024-04-26 MATTHIAS BREUER, EVA LABRO, HARESH SAPRA, ANASTASIA A. ZAKOLYUKINA
Formal theory and empirical research are complementary in building and advancing the body of knowledge in accounting in order to understand real-world phenomena. We offer thoughts on opportunities for empiricists and theorists to collaborate, build on each other's work, and iterate over models and data to make progress. For empiricists, we see room for more descriptive work, more experimental work
-
Diversity Washing Journal of Accounting Research (IF 4.9) Pub Date : 2024-04-26 ANDREW C. BAKER, DAVID F. LARCKER, CHARLES G. McCLURE, DURGESH SARAPH, EDWARD M. WATTS
We provide large‐sample evidence on whether U.S. publicly traded corporations use voluntary disclosures about their commitments to employee diversity opportunistically. We document significant discrepancies between companies' external stances on diversity, equity, and inclusion (DEI) and their hiring practices. Firms that discuss DEI excessively relative to their actual employee gender and racial diversity
-
Innovation and Financial Disclosure Journal of Accounting Research (IF 4.9) Pub Date : 2024-04-25 HUI CHEN, PIERRE JINGHONG LIANG, EVGENY PETROV
We examine how financial disclosure policy affects a firm manager's strategy to innovate within a two-period bandit problem featuring two production methods: an old method with a known probability of success, and a new method with an unknown probability. Exploring the new method in the first period provides the manager with decision-useful information for the second period, thus creating a real option
-
Algorithmic Trading and Forward-Looking MD&A Disclosures Journal of Accounting Research (IF 4.9) Pub Date : 2024-04-01 WAYNE B. THOMAS, YIDING WANG, LING ZHANG
This study examines how algorithmic trading (AT) affects forward-looking disclosures in Management Discussion and Analysis (MD&A) of annual reports. We predict and find evidence that AT relates negatively to modifications in year-over-year forward-looking MD&A disclosures. This evidence is consistent with AT reducing investors’ demand for fundamental information, which reduces managers’ incentives
-
The Impact of Information Frictions Within Regulators: Evidence from Workplace Safety Violations Journal of Accounting Research (IF 4.9) Pub Date : 2024-04-01 ANEESH RAGHUNANDAN, THOMAS G. RUCHTI
The Occupational Safety and Health Administration (OSHA) is decentralized, wherein field offices coordinated at the state level undertake inspections. We study whether this structure can lead to interstate frictions in sharing information and how this impacts firms’ compliance with workplace safety laws. We find that firms caught violating in one state subsequently violate less in that state but violate
-
Issue Information ‐ Standing Call for Proposals for Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-30
-
Issue Information ‐ Request for Papers Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-30
-
-
Issue Information ‐ Request for Registered Reports Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-30
-
Social Comparison on Multiple Tasks: Sacrificing Overall Performance for Local Excellence? Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-26 MAXIMILIAN KOHLER, MATTHIAS D. MAHLENDORF, MISCHA SEITER, TIMO VOGELSANG
This field experiment investigates how different levels of aggregation in relative performance information (RPI) impact employee performance in environments with multiple tasks. We randomly assign store employees of a retail chain to three groups: RPI on overall performance (control group), RPI on separate tasks, and RPI on both overall performance and separate tasks. We do not find evidence that providing
-
When Employees Go to Court: Employee Lawsuits and Talent Acquisition in Audit Offices Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-24 JADE HUAYU CHEN
I examine whether employee-initiated lawsuits against an audit office adversely affect its ability to attract high-quality talent and deliver quality audits. I posit that employee lawsuits erode prospective employees’ perceptions of an office, diminishing their willingness to join. Using a comprehensive data set of individual auditor profiles, I find a decline in the quality of newly hired auditors
-
Home Sweet Home: CEOs Acquiring Firms in Their Birth Countries Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-19 ANTONIO MARRA, ANGELA PETTINICCHIO, RON SHALEV
We find that foreign-born CEOs are more inclined than domestic-born ones to acquire across borders, and that this inclination is explained by their preference for targets in their birth country. This preference is motivated by foreign-born CEOs’ information advantage in their birth country and by these CEOs’ desire to give back to the birth country. CEOs’ desire to help their birth country also influences
-
Equity Incentive Plans and Board of Director Discretion over Equity Grants Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-12 BRIAN CADMAN, RICHARD CARRIZOSA
Equity compensation is granted out of an equity incentive plan that must be approved by shareholders and cedes discretion over equity grants to boards of directors. We predict and find that equity plan proposals give boards more discretion over grants when the firm faces greater labor market forces and more volatile stock returns. When examining votes, we find that shareholders are less likely to support
-
How Does Management Voluntary Disclosure Behavior Influence Auditors’ Judgments? Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-05 SEAN M. HILLISON, KAMBER D. VITTORI
Forward-looking information, often used by auditors to evaluate complex estimates and form conclusions about going-concern audit report modifications, is commonly disclosed voluntarily by U.S. public companies. We experimentally examine how this disclosure behavior affects auditors’ skepticism toward such information. Prior research has shown that investors and analysts frequently interpret voluntarily
-
Bank Supervision and Organizational Capital: The Case of Minority Lending Journal of Accounting Research (IF 4.9) Pub Date : 2024-03-05 BYEONGCHAN AN, ROBERT BUSHMAN, ANYA KLEYMENOVA, RIMMY E. TOMY
We investigate whether improvements in banks' organizational capital and control systems facilitate increased loan origination to minority borrowers. We focus on bank supervisors' enforcement decisions and orders (EDOs) against banks and hypothesize that EDO-imposed improvements in loan policies, internal governance, and employee training mitigate deficiencies in credit assessments and lending decisions
-
The Real Effects of Supply Chain Transparency Regulation: Evidence from Section 1502 of the Dodd–Frank Act Journal of Accounting Research (IF 4.9) Pub Date : 2024-02-29 BOK BAIK, OMRI EVEN-TOV, RUSSELL HAN, DAVID PARK
Section 1502 of the Dodd–Frank Act requires SEC-registered issuers to conduct supply chain due diligence and submit conflict minerals disclosures (CMDs) that indicate whether their products contain tantalum, tin, tungsten, or gold (3TG) sourced from the Democratic Republic of the Congo (DRC) or its neighboring countries (“covered countries”). Consistent with the reputational cost hypothesis, we find
-
Wrong Kind of Transparency? Mutual Funds’ Higher Reporting Frequency, Window Dressing, and Performance Journal of Accounting Research (IF 4.9) Pub Date : 2024-02-20 XIANGANG XIN, P. ERIC YEUNG, ZILONG ZHANG
This study examines whether mandatory increase in reporting frequency exacerbates agency problems. Utilizing the setting of the 2004 SEC mandate on increased reporting frequency of mutual fund holdings, we show that increased reporting frequency elevates window dressing (buying winners or selling losers shortly before the end of the reporting period). This effect is driven by low-skill fund managers’
-
Economics of Information Search and Financial Misreporting Journal of Accounting Research (IF 4.9) Pub Date : 2024-02-14 JUNG MIN KIM
I examine how investors’ search for different types of information affects managers’ reporting decisions. I distinguish investors’ search for information about firm fundamentals (“fundamental search”) from their search for information about managers’ incentives (“incentive search”). Based on a parsimonious model of misreporting, I predict that fundamental search reduces the earnings response coefficient
-
Earnings News and Over-the-Counter Markets Journal of Accounting Research (IF 4.9) Pub Date : 2024-02-07 STEFAN J. HUBER, CHONGHO KIM, EDWARD M. WATTS
We document significant increases in bond market liquidity around earnings announcements. These increases are attributed to decreased search and bargaining costs, which arise from the over-the-counter (OTC) nature of bond markets and outweigh increases in information asymmetry during these periods. Our evidence traces reductions in search and bargaining costs to two sources around earnings announcements:
-
Payment Practices Transparency and Customer-Supplier Dynamics Journal of Accounting Research (IF 4.9) Pub Date : 2024-02-07 JODY GREWAL, ADITYA MOHAN, GERARDO PÉREZ-CAVAZOS
We exploit the introduction of the Payment Practices Disclosure Regulation in the United Kingdom (UK) to examine the effects of mandating disclosure of customer-supplier payment practices. We find that nondisclosing small and medium-sized enterprises (SMEs) experience a reduction in their accounts receivable by 8.3%, consistent with an acceleration of their trade credit collections. Further, SMEs exhibit
-
Fraud Power Laws Journal of Accounting Research (IF 4.9) Pub Date : 2023-12-30 EDWIGE CHEYNEL, DAVIDE CIANCIARUSO, FRANK S. ZHOU
Using misstatement data, we find that the distribution of detected fraud features a heavy tail. We propose a theoretical mechanism that explains such a relatively high frequency of extreme frauds. In our dynamic model, a manager manipulates earnings for personal gain. A monitor of uncertain quality can detect fraud and punish the manager. As the monitor fails to detect fraud, the manager's posterior
-
Occupational Licensing and Minority Participation in Professional Labor Markets Journal of Accounting Research (IF 4.9) Pub Date : 2023-12-12 ANDREW G. SUTHERLAND, MATTHIAS UCKERT, FELIX W. VETTER
We examine the staggered adoption of additional educational requirements (“150-hour rule”) for Certified Public Accountants (“CPAs”) to understand the effects of occupational licensing on minority participation in professional labor markets. The 150-hour rule increased the educational requirement for CPAs from 120 to 150 credit hours, effectively adding a fifth year of study. We find a 13% greater
-
The Impact of Credit Market Development on Auditor Choice: Evidence from Banking Deregulation Journal of Accounting Research (IF 4.9) Pub Date : 2023-12-06 GUS DE FRANCO, YUYAN GUAN, YIBIN ZHOU, XINDONG ZHU
We exploit the staggered state-level adoption of the Riegle-Neal Interstate Banking and Branching Efficiency Act (IBBEA) to examine how banking deregulation and the resulting increase in bank competition affect firms’ auditor choices. We find that an exogenous increase in the degree of interstate branch banking deregulation leads to a reduction in firms’ propensity to engage a Big N or industry expert
-
Transparency in Hierarchies Journal of Accounting Research (IF 4.9) Pub Date : 2023-10-20 CHRISTIAN HOFMANN, RAFFI J. INDJEJIKIAN
We use an agency model to address the benefits and costs of transparency in a hierarchical organization in which the principal employs a manager entrusted with contracting authority and several workers, all under conditions of moral hazard. We define the principal's transparency choices as a decision to allow workers to observe their coworkers’ performances (observability) and as an investment in monitoring
-
Treatment of Accounting Changes and Covenant Violation Errors Journal of Accounting Research (IF 4.9) Pub Date : 2023-10-19 CHUNMEI ZHU
GAAP provisions in loan contracts specify how to address the effect of accounting changes on financial covenants. I document a pronounced upward trend in and the dominance of frozen-on-request (FOR) GAAP provisions, which incorporate accounting changes unless either the borrower or the lender requests a freeze. FOR GAAP streamlines the process of incorporating accounting changes into covenant calculations
-
What Role Do Boards Play in Companies with Visionary CEOs? Journal of Accounting Research (IF 4.9) Pub Date : 2023-10-16 XU JIANG, VOLKER LAUX
Visionary CEOs have strong beliefs about the right course of action for their firms. How should a board of directors that does not necessarily share the visionary CEO's confidence advise and monitor the CEO? We consider a model in which the board can acquire costly information about the firm's optimal strategic direction. The board not only advises the CEO on strategy, but also must approve it, and
-
Regulatory Transparency and Regulators’ Effort: Evidence from Public Release of the SEC's Review Work Journal of Accounting Research (IF 4.9) Pub Date : 2023-10-12 RUI GUO, Xiaoli (Shaolee) Tian
Using the public release of comment letters on EDGAR to capture a regime shift toward regulatory transparency, we examine whether an increase in transparency affects regulators’ effort and work performance. We find that the SEC staff reviews more filings and more documents per filing following the disclosure regime shift. These effects are incrementally stronger for firms with comment letters that
-
Information Complementarities and the Dynamics of Transparency Shock Spillovers Journal of Accounting Research (IF 4.9) Pub Date : 2023-10-03 SHANTANU BANERJEE, SUDIPTO DASGUPTA, RUI SHI, JIALI YAN
We show that information complementarities play an important role in the spillover of transparency shocks. We exploit the revelation of financial misconduct by S&P 500 firms, and in a “Stacked Difference-in-Differences” design, find that the implied cost of capital increases for “close” industry peers of the fraudulent firms relative to “distant” industry peers. The spillover effect is particularly
-
Corporate R&D Investments Following Competitors’ Voluntary Disclosures: Evidence from the Drug Development Process Journal of Accounting Research (IF 4.9) Pub Date : 2023-09-25 YUE ZHANG
This paper examines the role of peer firm disclosures in shaping corporate research and development (R&D) investments. Drawing on models of two-stage R&D races, I hypothesize that a firm could be either deterred or encouraged by peer disclosure of interim R&D success, depending on peer firms’ R&D strength in the race. Using granular, project-level data on clinical trials in the drug development process
-
Target Setting in Hierarchies: The Role of Middle Managers Journal of Accounting Research (IF 4.9) Pub Date : 2023-09-15 JAN BOUWENS, CHRISTIAN HOFMANN, NINA SCHWAIGER
We explore how a supervisor's hierarchical rank affects the extent to which employees’ targets reflect their past performance. Literature documents that supervisors do not fully ratchet targets for past performance, arguably because the commitment not to penalize successful employees with more difficult targets alleviates the severity of the ratchet effect. We argue that commitment is less credible
-
By What Criteria Do We Evaluate Accounting? Some Thoughts on Economic Welfare and the Archival Literature Journal of Accounting Research (IF 4.9) Pub Date : 2023-09-15 RAY BALL
The economic role of an accounting regime is to increase welfare through its effects—in conjunction with complementary institutions—on firm and household behavior. I review three major streams of the archival literature (real effects; price effects, including value relevance; and costly contracting), in terms of what they can and cannot reveal as proxies for welfare effects. One conclusion is that
-
Audit Partners’ Role in Material Misstatement Resolution: Survey and Interview Evidence Journal of Accounting Research (IF 4.9) Pub Date : 2023-08-18 ELDAR MAKSYMOV, MARK PEECHER, ANDREW SUTHERLAND, JOSEPH WEBER
Auditors are expected to identify and resolve material misstatements (MMs) in management's financial statements. However, beyond the audit opinion, the audit process is opaque. To address this, we independently survey 462 audit partners and interview 24 audit partners, CFOs, and audit committee members on how partners assess and address MM risk, resolve MMs, and the consequences of MMs. Partners identify
-
How Does Carbon Footprint Information Affect Consumer Choice? A Field Experiment Journal of Accounting Research (IF 4.9) Pub Date : 2023-08-14 BIANCA BEYER, RICO CHASKEL, SIMONE EULER, JOACHIM GASSEN, ANN-KRISTIN GROßKOPF, THORSTEN SELLHORN
This paper reports the results of a field experiment investigating how attributes of carbon footprint information affect consumer choice in a large dining facility. Our hypotheses and research methods were preregistered via the Journal of Accounting Research’s registration-based editorial process. Manipulating the measurement units and visualizations of carbon footprint information on food labels,
-
Out of Site, Out of Mind? The Role of the Government-Appointed Corporate Monitor Journal of Accounting Research (IF 4.9) Pub Date : 2023-08-09 LINDSEY A. GALLO, KENDALL V. LYNCH, RIMMY E. TOMY
We study the role of a relatively new type of external firm monitor, an on-site government-appointed Corporate Monitor, and assess whether such appointments reduce firms' propensity to violate laws. Using a sample of deferred and nonprosecution agreements, we first document the determinants of Monitor appointment. We find firms that voluntarily disclose wrongdoing and have more independent directors
-
The Effect of Client Industry Agglomerations on Auditor Industry Specialization Journal of Accounting Research (IF 4.9) Pub Date : 2023-08-09 W. ROBERT KNECHEL, DEVIN WILLIAMS
Prior research on auditor industry specialization documents fee premiums for local audit offices that are industry specialists. This research assumes that the effects of specialization are uniform across markets. We examine industry specialization based on the economic theory of industry agglomeration (geographic areas with high industry concentration). Agglomeration economies can facilitate access
-
Ethnic Minority Analysts’ Participation in Public Earnings Conference Calls Journal of Accounting Research (IF 4.9) Pub Date : 2023-08-08 RACHEL W. FLAM, JEREMIAH GREEN, JOSHUA A. LEE, NATHAN Y. SHARP
We investigate ethnic minority and nonminority sell-side analysts’ participation in public earnings conference calls. We find that minority analysts are underrepresented in conference call Q&A sessions, and minority analysts who do participate on the calls experience lower levels of prioritization than do nonminority analysts. Minority analysts’ lower participation rates are partially but not fully
-
Externalities of Financial Statement Fraud on the Incoming Accounting Labor Force Journal of Accounting Research (IF 4.9) Pub Date : 2023-08-04 ROBERT R. CARNES, DANE M. CHRISTENSEN, PAUL E. MADSEN
Financial statement fraud generates many negative effects, including reducing people's willingness to participate in the stock market. If it also stigmatizes accounting, it may similarly adversely affect the quantity and quality of workers willing to become accountants, thereby potentially creating negative effects for years to come. We examine the impact of fraud on the labor force entering the accounting
-
Reciprocity in Corporate Tax Compliance—Evidence from Ozone Pollution Journal of Accounting Research (IF 4.9) Pub Date : 2023-07-26 TRAVIS CHOW, ZHONGWEN FAN, LI HUANG, OLIVER ZHEN LI, SIMAN LI
In a tax—public goods reciprocity framework between citizens and the state, managers view taxes as a payment to the government in exchange for public goods, and hence they adjust their willingness to pay taxes as public good quality changes. We show that corporate tax planning intensity increases with ground-level ozone pollution. Revisions in ozone pollution regulations cause counties that failed
-
The Financially Material Effects of Mandatory Nonfinancial Disclosure Journal of Accounting Research (IF 4.9) Pub Date : 2023-07-18 BRIAN GIBBONS
Complaints from institutional investors suggest that principles-based disclosure regimes that rely on financial materiality standards produce inadequate nonfinancial environmental and social (E&S) information. Using the staggered introduction of 40 country-level regulations that mandate disclosure, I document that reporting E&S information relates to increased investment from institutional owners and
-
Economic Consequences of Transparency Regulation: Evidence from Bank Mortgage Lending Journal of Accounting Research (IF 4.9) Pub Date : 2023-06-23 ALLISON NICOLETTI, CHRISTINA ZHU
We examine the economic consequences of a rule designed to improve consumers' understanding of mortgage information. The 2015 TILA-RESPA Integrated Disclosures rule (TRID) simplifies the mortgage disclosures provided to consumers. As a consequence, TRID-affected mortgages become a less attractive investment opportunity to banks. Our main results document that mortgage applications affected by TRID
-
Do Governments Hide Resources from Unions? The Influence of Public Sector Unions on Reported Discretionary Fund Balance Ratios Journal of Accounting Research (IF 4.9) Pub Date : 2023-06-21 ANGELA K. GORE, YUAN JI, SUSAN L. KULP
We explore whether municipalities with public sector unions exploit aspects of governmental (or “fund”) accounting to obscure the availability of discretionary resources in fund balance accounts, relative to municipalities without public sector unions. We first investigate whether governments with unions report higher proportions of discretionary resources outside of the general fund, a primary measure
-
Price Rigidities and the Value of Public Information Journal of Accounting Research (IF 4.9) Pub Date : 2023-06-08 LIFENG GU, JIN XIE
Firms' inflexibility in adjusting output prices to economic shocks exacerbates information asymmetry with respect to firms' profits, but public information on firms' cost structure mitigates this problem. We construct a novel form of public information from economic statistics disclosed by the government and find that such public information significantly reduces inflexible-price firms' bid–ask spreads
-
The Real Effects of Modern Information Technologies: Evidence from the EDGAR Implementation Journal of Accounting Research (IF 4.9) Pub Date : 2023-06-08 ITAY GOLDSTEIN, SHIJIE YANG, LUO ZUO
Using the implementation of the Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system from 1993 to 1996 as a shock to information dissemination technologies, we examine how a significant reduction in disclosure processing costs affects the real economy. We find that the EDGAR implementation leads to an increase in corporate investment and that this effect is concentrated in value firms