Musings on Accounting Research by Steve

Home » 2014 » November

Monthly Archives: November 2014

Navel gazing – getting beyond the descriptive!

While the title of this post mind sound like I object to articles that study the process of producing knowledge in accounting – I really do not object.

What I object to is atheoretical research that is based on a randomly generated and idiosyncratic set of questions driven by the authors’ personal agenda and experience.

There is an entire literature on the sociology of knowledge production and indeed one can go right to institutional theory directly to generate research questions and hypotheses.

For example
1. Are elite schools barriers to innovative research in accounting?
2. Are authors from non-elite schools more likely to believe the review process is unfair?
3. Do universities contribute to the narrowing of knowledge production through a strategy of mimicking so- called elite schools?
4. What are the effects of race, gender, etc of research production?

In other words research in what we do and how we do it should be held to the same standards as any other research.

The last post on the link between macroeconomics underpinnings and accounting research

So why do these views support my argument for paradigm diversity?

Simple – if you do not get challenged on your fundamental assumptions that you bring to your research you lose the opportunity to see if your theoretical tools and interpretations can withstand alternative views.

After all, a group of monetarists may delve into the models and data sources that a fellow researcher has taken and hence be strong quality control for the workmanship of the evidence produced! But they will not be very likely to examine whether there are alternative interpretations of the evidence that make fit the findings better!

Why not? Functional fixation. They know what they know but they cannot know about the unknowns that do not fit into their theoretical world. Unknowns that could well lead to a richer interpretation of the evidence.

Without challenge their interpretation of their research is substantially less rich!

Yet I still see accounting programs devoted to single paradigms on the basis that it provides a congenial research environment! Really!!! Is that the criteria for doing good research – to be nice!!!! If that is what you want – a nice genial work environment – may I suggest a liberal arts university with a nice business school. Critical reflection is vital for an inquiring mind and respectful paradigm diversity causes such reflection to naturally occur!

Okay, onto another hobby horse next week!

Assumptions leading to our interpretation of evidence

Last post started an analysis of how fundamental macroeconomic views effects how we approach our accounting research without many of us realizing it! I suggested that this provided a fundamental argument in favour of a more diverse set of paradigms focused on accounting research. So let’s first see how it affects the generation of research questions.

For example: accounting and auditing regulators exist – what issues arise from that observation?

The monetarist sees this as an involvement of a third party in the free capital markets and immediately focuses on the costs of regulation and pines for a truly free market where prices are fully revealing. ( of course, for prices to be fully revealing in markets externalities need to be monetized so all costs are considered – but I digress) Hence, their focus is on the costs on the regulatee assuming that the best regulation is none. Benefits are hard to measure so the focus is on costs.

The Keynesian sees a regulator’s role as trying to ensure the market is more information based so that prices, such as they are, are efficiently set based on the best obtainable information. Hence, they see costs of regulation as part of the costs of keeping up the capitalist production system. They are interested in whether people can actually interpret and apply the regulation in an effective, and to a lesser extent, efficient manner.

The critical theorist (a Keynesian in the extreme form) sees the fact that regulators tend to be “captured” over time by those they regulate and hence believe that regulations move towards being symbolic rather than substantive. They view their role as revealing ” the emperor has no clothes.” In other words show that the powerful can dominant the regulator who is tasked with preventing that.

While very simple, this analysis has attempted to show how accounting research questions get framed by our understanding of the macroeconomic world. Next post – how does it require multiple paradigms in accounting research?

%d bloggers like this: