Alternative economic institutions to motivate managerial disclosure of private information: An experimental markets examination.

Persistent Link:
http://hdl.handle.net/10150/185019
Title:
Alternative economic institutions to motivate managerial disclosure of private information: An experimental markets examination.
Author:
Wallin, David Ernest.
Issue Date:
1990
Publisher:
The University of Arizona.
Rights:
Copyright © is held by the author. Digital access to this material is made possible by the University Libraries, University of Arizona. Further transmission, reproduction or presentation (such as public display or performance) of protected items is prohibited except with permission of the author.
Abstract:
A central consideration in constructing a theory of the firm is the divergent preferences of managers and investors. Managers have incentives to take actions (shirk, consume perquisites) not in the best interests of the firm. Accounting reports are a primary method by which managers make assertions about their actions or the results of their actions. Auditing is a mechanism by which managers can purchase external verification of their disclosures. This dissertation develops the demand for auditing in two multiperiod environments. The first environment allows the manager to disclose with impunity. In such a case the manager's demand for auditing depends on the ability of the manager to obtain the cooperative solution without auditing. The second environment permits the investors to bring suit against a manager suspected of issuing fraudulent disclosures. In that environment, a cooperative solution can be obtained without auditing. The results of 16 experiments designed to test the analytical assertions suggests that there is a demand for auditing, regardless of whether or not legal recourse is present. Both the availability of auditing and the availability of legal recourse induces a higher level of managerial effort. The highest level of managerial effort was seen when both auditing and legal recourse were available, despite the prediction that the presence of a legal system would make auditing useless. The investors tended to overbid and the markets with auditing reduced that tendency. Truthful disclosures were generally only seen when legal recourse was available.
Type:
text; Dissertation-Reproduction (electronic)
Keywords:
Disclosure in accounting; Managerial accounting; Auditors' reports; Executives -- Psychology.
Degree Name:
Ph.D.
Degree Level:
doctoral
Degree Program:
Business Administration; Graduate College
Degree Grantor:
University of Arizona
Advisor:
Waller, William S.

Full metadata record

DC FieldValue Language
dc.language.isoenen_US
dc.titleAlternative economic institutions to motivate managerial disclosure of private information: An experimental markets examination.en_US
dc.creatorWallin, David Ernest.en_US
dc.contributor.authorWallin, David Ernest.en_US
dc.date.issued1990en_US
dc.publisherThe University of Arizona.en_US
dc.rightsCopyright © is held by the author. Digital access to this material is made possible by the University Libraries, University of Arizona. Further transmission, reproduction or presentation (such as public display or performance) of protected items is prohibited except with permission of the author.en_US
dc.description.abstractA central consideration in constructing a theory of the firm is the divergent preferences of managers and investors. Managers have incentives to take actions (shirk, consume perquisites) not in the best interests of the firm. Accounting reports are a primary method by which managers make assertions about their actions or the results of their actions. Auditing is a mechanism by which managers can purchase external verification of their disclosures. This dissertation develops the demand for auditing in two multiperiod environments. The first environment allows the manager to disclose with impunity. In such a case the manager's demand for auditing depends on the ability of the manager to obtain the cooperative solution without auditing. The second environment permits the investors to bring suit against a manager suspected of issuing fraudulent disclosures. In that environment, a cooperative solution can be obtained without auditing. The results of 16 experiments designed to test the analytical assertions suggests that there is a demand for auditing, regardless of whether or not legal recourse is present. Both the availability of auditing and the availability of legal recourse induces a higher level of managerial effort. The highest level of managerial effort was seen when both auditing and legal recourse were available, despite the prediction that the presence of a legal system would make auditing useless. The investors tended to overbid and the markets with auditing reduced that tendency. Truthful disclosures were generally only seen when legal recourse was available.en_US
dc.typetexten_US
dc.typeDissertation-Reproduction (electronic)en_US
dc.subjectDisclosure in accountingen_US
dc.subjectManagerial accountingen_US
dc.subjectAuditors' reportsen_US
dc.subjectExecutives -- Psychology.en_US
thesis.degree.namePh.D.en_US
thesis.degree.leveldoctoralen_US
thesis.degree.disciplineBusiness Administrationen_US
thesis.degree.disciplineGraduate Collegeen_US
thesis.degree.grantorUniversity of Arizonaen_US
dc.contributor.advisorWaller, William S.en_US
dc.contributor.committeememberIsaac, R. Marken_US
dc.contributor.committeememberSchatzberg, Jefferyen_US
dc.identifier.proquest9024637en_US
dc.identifier.oclc703879106en_US
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