TThere has been debate over the economic consequences of accounting conservatism in debt contracting. We contribute to … accounting, even though it may not improve contracting efficiency ex post. The empirical evidence of the negative correlation … between interest rates and conservative accounting may be explained by the heterogeneity among firms, such as riskiness …

We examine whether accounting quality is associated with efficient investments in labor. Consistent with high quality … accounting mitigating market frictions that lead to sub-optimal levels of investment, we find evidence that abnormal net hiring … (measured as the absolute deviation from net hiring predicted by economic fundamentals) is negatively associated with accounting …

substitutional and a complementary relationship between accounting information and reputation, an informal institution. Empirical … the legal environment is far from perfect, the complementary relationship between reputation and accounting information is … the usefulness of accounting information in debt contracts. Besides the aggregate effect, this paper also provides …

In this paper, we investigate whether the use of accounting conservatism in India decreases IPO underpricing, which is … implication of accounting conservatism for IPOs. Based on a regression analysis of 527 firms that went public through IPOs of "A … conservatism and under-pricing is robust to alternative measures of accounting conservatism, mean regressions, sample exclusions …

demand for accounting conservatism when suppliers or customers have bargaining advantages over it that enable them to dictate … customers are associated with its accounting practices and also support the contracting explanation for accounting conservatism …

In this paper, we offer a new theory for the economic demand of accounting conservatism, which emphasizes the signaling … role of conservatism in a debt market with asymmetric information. In our model, accounting conservatism serves as a signal … analytically derive four basic properties of accounting conservatism, based on Basu's (1997) asymmetric timeliness of earnings …

In this paper, we investigate the effect of accounting biases on firms' financing decisions and the role of accounting …-biased accounting system performs better than a neutral accounting system, and a more downward bias helps mitigate both investment and … financing inefficiency; while for industries with generally high-profit prospects, an upward-biased accounting system is better …