THE SMOOTHING OF INCOME NUMBERS: SOME EMPIRICAL EVIDENCE ON SYSTEMATIC DIFFERENCES BETWEEN CORE AND PERIPHERY INDUSTRIAL SECTORS |
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| Authors: | Ahmed Belkaoui Ronald D Picur |
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| Institution: | The authors are respectively, Professor of Accounting, and Associate Professor of Accounting at the University of Illinois at Chicago. They wish to thank the participants in the accounting workshop at the University of Illinois as well as an anonymous referee for their helpful comments and suggestions on an earlier draft of this paper. |
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| Abstract: | This study tests the effects of the dual economy on income smoothing behavior. It is hypothesized that a higher degree of smoothing of income numbers will be exhibited by firms in the periphery sector than by firms in the core sector as a reaction to different opportunity structures and experiences. The results indicate that a majority of firms may be resorting to income smoothing. A higher number is included among firms in the periphery sector. |
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