Date of Award

1996

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Department

Accounting

First Advisor

Nicholas Apostolou

Abstract

Many sectors of the United States economy have experienced deregulation during the 1970s and 1980s. This study examines how deregulation affects the informativeness of accounting earnings of firms in deregulation industries. In this study, the informativeness of accounting earnings is measured by the earnings response coefficient (ERC, the slope coefficient in the regression of abnormal stock returns on unexpected accounting earnings). The effects of deregulation on ERCs are examined by (1) comparing ERCs before deregulation to those after deregulation to determine the changes in the magnitude of ERCs due to deregulation, (2) investigating the time series of ERCs after deregulation to determine the intertemporal variation of ERCs following deregulation, and (3) comparing the change in ERCs in one deregulated industry to that in another deregulated industry to determine the differential effects of deregulation. Results indicate that changes in the magnitude of ERCs due to deregulation and differences in the changes in the magnitude of ERCs among the three industries examined are found in some cases but only when variables found to be determinants of ERCs in previous studies are not included in the regression models. In other words, after controlling for the effects of covariates, no evidence is found for a significant impact of industry deregulation on ERCs.

ISBN

9780591133752

Pages

84

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