Explaining the choice of accounting standards in municipal corporations: Positive accounting theory and institutional theory as competitive or concurrent theories

Sven-Olof Yrjö Collin, Torbjörn Tagesson, Anette Andersson, Joosefin Cato and Karin Hansson

CRITICAL PERSPECTIVES ON ACCOUNTING, 2009, vol. 20, issue 2, 141-174

Abstract: Municipal corporations exist in an institutional twilight area, being both private and public, a characteristic, which presumably would be reflected in their choice of accounting standards. The literature of accounting choice does not, however, live in a twilight area, but is fragmented into two main divisions: positive accounting theory (PAT) and institutional theory (IT); only in a very few cases do the theories meet or cross-fertilize. We use both theories in this paper and derive hypotheses from them to explain accounting choices made by municipal corporations. Through testing the hypotheses on a sample of 545 Swedish municipal corporations, we indicate the empirical relevance of both PAT and IT. We conclude by suggesting an integrative approach of PAT and IT in an eclectic alternative.

Keywords: Accounting choice; Accounting standards; Positive accounting theory; Institutional theory; Eclectic accounting theory; Municipal corporation; Sweden (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (18)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:crpeac:v:20:y:2009:i:2:p:141-174

DOI: 10.1016/j.cpa.2008.09.003

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