Skewness of Earnings and the Believability Hypothesis: How Does the Financial Market Discount Accounting Earnings Disclosures?

M Krishnan, S Sankaraguruswamy and Hyun Song Shin

Economics Papers from Economics Group, Nuffield College, University of Oxford

Abstract: When firms attempt to manage their earnings disclosures by presenting evidence selectively, sophisticated inference on the part of financial market participants entails a positive association between the market to bood ratio of a firm and the skewness of the distribution of its announced earnings. In this paper, we put this hypothesis to the test, and confirm its main predictions.

Keywords: FINANCIAL MARKET; ECONOMIC MODELS (search for similar items in EconPapers)
JEL-codes: C52 E44 (search for similar items in EconPapers)
Pages: 25 pages
Date: 1996
References: Add references at CitEc
Citations: View citations in EconPapers (2)

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:nuf:econwp:120

Access Statistics for this paper

More papers in Economics Papers from Economics Group, Nuffield College, University of Oxford Contact information at EDIRC.
Bibliographic data for series maintained by Maxine Collett ().