Religion, Crime, and Financial Reporting

C. Hofmann and Nina Schwaiger

Publications of Darmstadt Technical University, Institute for Business Studies (BWL) from Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL)

Abstract: The literature provides evidence on the separate roles of injunctive and descriptive norms in explaining corporate financial reporting, ignoring that descriptive norms are likely endogenous and partly explained by injunctive norms. We jointly analyze the direct and indirect effects of religious social norms (an injunctive norm) via local crime rates (a descriptive norm) on financial reporting quality. We find that religious social norms relate negatively to corporate earnings management and tax avoidance. We also show that this association is partially explained by crime rates in the firm’s geographical environment, underlining the indirect relation between religious social norms and financial reporting quality. Overall, the study highlights the importance of considering the interrelations between injunctive and descriptive norms when analyzing the effect of norms on corporate decision-making.

Date: 2020-04-17
Note: for complete metadata visit http://tubiblio.ulb.tu-darmstadt.de/157172/
References: Add references at CitEc
Citations:

Published in Journal of Business Economics = Zeitschrift für Betriebswirtschaft 5 (2020-04-17) : pp. 879-916

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:dar:wpaper:157172

Access Statistics for this paper

More papers in Publications of Darmstadt Technical University, Institute for Business Studies (BWL) from Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL) Contact information at EDIRC.
Bibliographic data for series maintained by Dekanatssekretariat ().