Accounting conservatism and firm investment efficiency

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dc.contributor.author García-Lara, Juan M.
dc.contributor.author García Osma, Beatriz
dc.contributor.author Penalva, Fernando
dc.date.accessioned 2017-01-18T09:49:56Z
dc.date.available 2018-02-01T23:00:06Z
dc.date.issued 2016-02-01
dc.identifier.bibliographicCitation Journal of Accounting and Economics, (2016), 61 (1), pp. 221-238.
dc.identifier.issn 0165-4101
dc.identifier.uri http://hdl.handle.net/10016/24030
dc.description.abstract We argue that conservatism improves investment efficiency. In particular, we predict that it resolves debt-equity conflicts, facilitating a firm's access to debt financing and limiting under investment. This permits the financing of prudent investments that otherwise might not be pursued. Our empirical results confirm these predictions. We find that more conservative firms invest more and issue more debt in settings prone to underinvestment and that these effects are more pronounced in firms characterized by greater information asymmetries. We also find that conservatism is associated with reduced overinvestment, even for opaque investments such as research and development.
dc.format.extent 18
dc.format.mimetype application/pdf
dc.language.iso eng
dc.publisher Elsevier
dc.rights © Elsevier, 2016
dc.rights Atribución-NoComercial-SinDerivadas 3.0 España
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.subject.other Conservatism
dc.subject.other Earnings asymmetric timeliness
dc.subject.other Investment efficiency
dc.subject.other Under-investment
dc.subject.other Over-investment
dc.title Accounting conservatism and firm investment efficiency
dc.type article
dc.relation.publisherversion http://dx.doi.org/10.1016/j.jacceco.2015.07.003
dc.subject.eciencia Economía
dc.identifier.doi 10.1016/j.jacceco.2015.07.003
dc.rights.accessRights openAccess
dc.type.version acceptedVersion
dc.identifier.publicationfirstpage 221
dc.identifier.publicationissue 1
dc.identifier.publicationlastpage 238
dc.identifier.publicationtitle Journal of accounting & economics
dc.identifier.publicationvolume 61
dc.identifier.uxxi AR/0000017849
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