Journal
FRONTIERS IN PSYCHOLOGY
Volume 13, Issue -, Pages -Publisher
FRONTIERS MEDIA SA
DOI: 10.3389/fpsyg.2022.883596
Keywords
religion; real earnings management; corporate governance; social cultural; social norms
Categories
Ask authors/readers for more resources
This paper investigates the impact of local religious beliefs on the practice of earnings management. The findings suggest a negative relationship between religiosity and earnings management, indicating that firms located in counties with strong religious social norms are less likely to engage in earnings management.
This paper investigates whether local religious beliefs have a significant impact on the practice of earnings management. We extend the existing literature on the role of firm characteristics in mitigating earnings management by showing that local religious beliefs significantly impact the practice of earnings management. Specifically, exploring firms located in the U.S. counties that vary from 2000 through 2010, we document the negative relationship between religiosity and earnings management using multivariate regression analysis. Our results show that firms in counties with strong religious social norms are less likely to engage in earnings management. Furthermore, we attempt to mitigate endogeneity concerns by employing a modified Difference-Differences model and Propensity score matching methods. We find that the negative effects of religion on earnings management still hold. Overall, these findings emphasize the empirical relevance of the association between the local social norms and earnings manipulations.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available