Beatty, Anne; Liao, Scott; Yu, Jeff Jiewei - In: Journal of Accounting and Economics 55 (2013) 2, pp. 183-205
We investigate how high-profile accounting frauds affect peer firms' investment. We document that peers react to the fraudulent reports by increasing investment during fraud periods. We show that this finding is not driven by frauds that have a higher ex ante likelihood of detection or by an...