Modeling the determinants of meet-or-just-beat behavior in distribution discontinuity tests

• 成果类型: Article
• 署名作者: Byzalov, Dmitri; Basu, Sudipta
• 署名单位: Pennsylvania Commonwealth System of Higher Education (PCSHE); Temple University
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2019.101266
• 发表日期: 2019
• 关键词: earnings management; nonaudit services; european private; incentives; selection; eps; decreases; shapes; COSTS; FIRMS

摘要

We develop new distribution discontinuity tests conditional on multiple explanatory variables for analyzing meet-or-just-beat behavior around benchmarks. These tests combine Burgstahler and Dichev's (1997) meet-or-just-beat intuition with a flexible statistical model that addresses important limitations of the existing tests. Our method considerably outperforms logit-based tests of distribution discontinuity determinants and changes the interpretation of a major finding in the earnings discontinuity literature. As a secondary benefit, it also has slightly higher statistical power than histogram-based tests of distribution discontinuity existence. Our method is robust, easy to implement using our publicly available Stata command, and could benefit researchers in many fields. (C) 2019 Elsevier B.V. All rights reserved.