ISSN:
1573-7179
Keywords:
self-selection bias
;
management earnings forecasts
;
stock price reaction
;
zero/one dummy variable approach
Source:
Springer Online Journal Archives 1860-2000
Topics:
Economics
Notes:
Abstract This study examines the inferential bias due to the failure to control for self-selection when studying the market's reaction to management earnings forecasts. The analysis is conducted by controlling for self-selection and comparing the results to those obtained when self-selection is not controlled. This comparison suggests that the overall inference of a market reaction to the management forecast issuance does not change. However, the statistical significance declines when self-selection is considered. Since the issuance of a management forecast is an obvious self-selection, the results of this study suggest that self-selection should be considered and evaluated in quasi-experimental studies in accounting and finance.
Type of Medium:
Electronic Resource
URL:
http://dx.doi.org/10.1007/BF01074849
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