UM  > Faculty of Business Administration
Individualist-collectivist culture, ownership concentration and earnings quality
Chan Lyu1; Desmond Chun Yip Yuen2; Xu Zhang2
2017-04-03
Source PublicationAsia-Pacific Journal of Accounting & Economics
ABS Journal Level2
ISSN1608-1625
Volume24Issue:1-2Pages:23-42
Abstract

In this study we explore the effects of individualist-collectivist culture, an important dimension of national cultures, on the entrenchment incentives of large shareholders. Specifically, we investigate how individualist-collectivist culture affects the relationship between ownership concentration and earnings quality. We predict that the social connections among corporate insiders are stronger in collectivist societies, thus reducing corporate monitoring efficiency and exacerbating agency problems. Consistent with our prediction we find the poor earnings quality that normally goes hand-in-hand with concentrated ownership, is improved when the firm’s national culture is individualist. We further find that the poor earnings quality induced by ownership concentration is more pronounced in East Asia, where cultures are rooted in Chinese cultures and collectivism. This study sheds light on the role that individualist-collectivist culture plays in shaping corporate insiders’ ethical behavior.

KeywordEarnings Quality Ownership Concentration Cultures Individualism Collectivism
DOIhttps://doi.org/10.1080/16081625.2015.1129281
URLView the original
Indexed BySSCI ; SSCI
Language英語English
WOS Research AreaBusiness & Economics
WOS SubjectBusiness, Finance ; Economics
WOS IDWOS:000392856200002
PublisherROUTLEDGE JOURNALS, TAYLOR & FRANCIS LTD, 2-4 PARK SQUARE, MILTON PARK, ABINGDON OX14 4RN, OXON, ENGLAND
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Cited Times [WOS]:5   [WOS Record]     [Related Records in WOS]
Document TypeJournal article
CollectionFaculty of Business Administration
DEPARTMENT OF ACCOUNTING AND INFORMATION MANAGEMENT
Corresponding AuthorXu Zhang
Affiliation1.School of Business, Macau University of Science and Technology, Macau, China
2.Department of Accounting and Information Management, University of Macau, Macau, China
First Author AffilicationUniversity of Macau
Corresponding Author AffilicationUniversity of Macau
Recommended Citation
GB/T 7714
Chan Lyu,Desmond Chun Yip Yuen,Xu Zhang. Individualist-collectivist culture, ownership concentration and earnings quality[J]. Asia-Pacific Journal of Accounting & Economics,2017,24(1-2):23-42.
APA Chan Lyu,Desmond Chun Yip Yuen,&Xu Zhang.(2017).Individualist-collectivist culture, ownership concentration and earnings quality.Asia-Pacific Journal of Accounting & Economics,24(1-2),23-42.
MLA Chan Lyu,et al."Individualist-collectivist culture, ownership concentration and earnings quality".Asia-Pacific Journal of Accounting & Economics 24.1-2(2017):23-42.
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