Musings on Accounting Research by Steve

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Thought experiment 101


to set up this entry let’s assume An author had written an experimental paper that created post-earnings announcement drift in the lab.  Let’s further assume that The author wrote this paper carefully citing the experimental economics literature, the finance and economics literature and other experimental accounting papers that were related to this paper!

But, let’s assume The author did not quote any financial accounting papers other than ball and brown!  No Bernard and thomas, ec etc etc!  After all their work was not immediately relevant to my experimential paper as The author was not attempting to make a market inefficiency versus risk argument!

If The author presented such a paper to a standard accounting audience in most of the world what do you think would be the reaction of capital markets researchers?  

Do you think The author would have faced some tough questions?   Do you think the author might have been accused of ignoring important accounting research literature? Do you think there might have been some suggestions that The author was not very competent in the tone of the questions? That at the very least by ignoring this literature the results could have been much more informed if the literature was cited? 

I think we all know that the answer to all of these latter three questions would be a resounding YES!!!  Would The author have deserved it – YES!  Would it have been a ” feeding frenzy” with lots of questions, some openly hostile, to the author!!! We have all seen this happen…..

BUT what if the shoe were on the other foot? See my next post for the answer!

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