Corporate lobbying and market reaction to proposed accounting rules: The case of postretirement benefits other than pensions.
Item
-
Title
-
Corporate lobbying and market reaction to proposed accounting rules: The case of postretirement benefits other than pensions.
-
Identifier
-
AAI9108087
-
identifier
-
9108087
-
Creator
-
Chung, Kwang-Hyun.
-
Contributor
-
Adviser: Victor Pastena
-
Date
-
1990
-
Language
-
English
-
Publisher
-
City University of New York.
-
Subject
-
Business Administration, Accounting | Political Science, General
-
Abstract
-
This study investigates what determines firms' lobbying positions on the proposed accounting standard for postretirement benefits other than pensions. It also examines whether the market reacts to events indicating an accounting change for these retiree benefits.;Corporate lobbying positions are hypothesized to be determined by the future income effect of the new accounting standard, firms' labor power, financial slack, management wealth from stock ownership, debt contracts, and market structure. Empirical results consistently support such hypotheses as the future income effect, management wealth, and market structure.;For the market study, two different portfolio groups are considered depending on the existence of the benefit plans. After the stock performances of each group are examined during eight individual event periods, the determinants of the market reaction, if any, are tested based on the hypotheses of future income effect, labor productivity, industry, financial slack, and debt contracts. Empirical tests show that firms with the benefit plans experienced significantly negative abnormal returns for most events while firms without the plans did not. Few hypotheses could explain the negative abnormal returns on a consistent basis. However, the future income effect is the best determinant of the market reaction.;Finally, the association between firms' lobbying positions and the market reaction is examined to determine whether the wealth transfer due to proposed accounting change can predict the firms' lobbying decision. It is found that the market reaction is rarely associated with a firm's lobbying decision.
-
Type
-
dissertation
-
Source
-
PQT Legacy CUNY.xlsx
-
degree
-
Ph.D.
