Investor protection, aggregate changes in profit margins and forecasts of growth in GDP: international evidence

• 成果类型: Article
• 署名作者: Fargher, Neil; Zhang, Lijuan
• 署名单位: Australian National University
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-023-09785-6
• 发表日期: 2024
• 页码: 3497-3533
• 关键词: reporting incentives; ACCOUNTING EARNINGS; management; INFORMATION; accruals; QUALITY; LEGAL; analysts; income; macro

摘要

This study draws on the investor protection literature to examine whether differences in a country's level of investor protections help explain cross-country variation in the extent to which macroeconomic forecasters consider aggregate changes in corporate profit margins when forecasting growth in GDP. We find that economies with stronger levels of investor protection have a higher association between changes in aggregate profit margin and GDP growth. Using a unique sample of analysts' GDP forecasts from 28 countries, we find that economies with stronger levels of investor protection have a lower association between changes in aggregate profit margin and errors in forecasts of GDP growth.