Typical textbook treatments of tax-advantaged retirement savings focus on legalistic characteristics such as contribution limits and early withdrawal penalties. Popular press articles often present a myriad of details on the effects of inflation, rates of return, expected tax rates, ordinary...

A large body of evidence indicates individuals keep promises even if self-interest dictates otherwise. Two rationales have been put forth. First, promises form an emotional commitment to keep actions and deeds consistent, referred to as the commitment rationale. Second, promises change the...

Purpose: To explore the role of accounting discretion in a principal-agent setting, where accounting information is used in performance evaluation. The agent, who is to be evaluated, may choose one from among several allowable accounting methods. However, limited audit resources allow only for...

Accounting is often viewed from a legalistic rather than economic perspective. Finance, on the other hand, is deeply rooted in economic theory, but at its heart is built on assumptions of frictionless markets. Neither perspective fully incorporates the rich economic environment in which we find...

An experiment with three treatments is used to evaluate the social efficiency of budgeting protocols induced by other-regarding preferences. In disaggregated superiors receive three individual proposals in iterated fashion, and must decide whether to accept each project without knowledge of the...

We conduct an experiment designed to investigate unobservable commitment in a management control setting with a privately informed subordinate. The experimental setting follows closely that found in Evans, Hannan, Krishan and Moser [2001] and Rankin, Schwartz and Young [2003]. In one treatment...

By its very nature, management control research can be complex and difficult to understand, and hence challenging to introduce into the classroom. Nevertheless, it is important for accounting instruction to retain a connection between teaching and research. This note provides guidance on how...

This study investigates the effect of a principal's choice on the availability of discretionary controls, where discretionary controls are defined as those not supported by enforceable explicit contracts. In contrast to prior findings on explicit controls, we find that agent reciprocity is not...

Agency research on capital budgeting has demonstrated that a principal can reduce information rents by contracting on several investment projects in aggregate rather than on each investment project individually. We investigate the robustness of this result in a model that facilitates comparative...

I examine the effect of marketable security holdings on monetary policy when those securities are classified under SFAS 115. Prior research has shown that loan growth is negatively related to monetary contractions and that marketable security holdings mitigate that negative relationship. Those...