We examine the increasing variance of earnings of white men over the 1970s and 1980s by focusing on changes in the covariance structure of earnings. Using data from the Michigan PSID from 1969-1987, we find that about half of the increase has arisen from an increase in the variance of the permanent component of earnings and half from an increase in the variance of the transitory component, wher...

This paper studies market and analyst reactions to earnings (i) during a proxy contest for board seats and (ii) after a proxy-contest-induced management change. Despite indications of earnings management during the proxy contest, market and analyst reactions are more pronounced than in prior periods, and earnings surprises explain more of the cross-sectional variation in these reactions. Market...

In this paper I analyse the dynamic structure of earnings in Great Britain for the period 1991-1999 by decomposing the earnings covariance structure into its permanent and transitory components. Using information on monthly earnings of male full-time employees from the first nine waves of the British Household Panel Study I find that earnings inequality increases over the Nineties. However, ear...

We argue that earlier quantitative research on the relationship between heterosexual partners’ earnings and time spent on housework has two basic flaws. First, it has focused on the effects of women’s shares of couples’ total earnings on their housework, and has not considered the simpler possibility of an association between women’s absolute earnings and housework. Consequently it has relied o...

If self-employment were much more prevalent at moderate and high earnings levels than at low levels and if the incidence of both the employee and employer taxes on wages is on the employee, then the social security tax structure would be regressive relative to taxable earnings. Analysis shows, however, that this is the case only in a very limited sense. For 1970, 6.5 percent of taxable earnings...

Labor Market Assimilation and the Self-Employment Decision of Immigrant Entrepreneurs This paper uses data from the 1980 and 1990 U.S. Censuses to study labor market assimilation of self-employed immigrants. Separate earnings functions for the self-employed and wage/salary workers are estimated. To control for endogenous sorting into the sectors, models of the self-employment decision are estim...

While there are many alternative proxies for “earnings quality”, there is little evidence as to what auditors consider to be indicative of high earnings quality. To answer this, we examine the adjustments that auditors require companies to make to earnings during year-end audits. There are three findings. First, audit adjustments serve to increase earnings persistence, smoothness, and accrual q...

When the Revelation Principle (RP) holds, managing earnings confers no advantage over revelation. We construct an explanation for earnings management that is based on limitations on owners’ ability to make commitments (a violation of the RP’s assumptions). Traditionally, earnings management is seen as sneaky managers pulling the wool over the eyes of gullible owners by manipulating accruals; ou...

Security analysts generally provide forecasts of earnings for the current period as well as oneyear ahead earnings at fiscal year end. In this study, we derive an estimation procedure, which infers forecast bias from equivalent price expressions that utilize different horizon earnings forecasts. It is well documented that analyst long-horizon earnings forecasts tend to be more optimistic (ex po...

the main purpose of the present research is to determine the relationship between the management earnings forecast errors and conservatism level and then surveying about the effects of forecast difficulty, and external financing on this relationship. regarding this, the financial information related to 147 stock firms, available during the period of study (2003-2015) were collected and analyzed...