| Summary: | 碩士 === 國立成功大學 === 會計學系 === 107 === This study examines how accounting conservatism moderates the relationship between business strategy and investment efficiency. Prior literature has argued that the firms with an innovation-driven Prospectors strategy tend to conduct over-investment decisions, while the firms with an efficiency-driven Defenders strategy tend to conduct under-investment decisions. Other prior studies show that conservatism is a part of a corporate governance system that can mitigate investment inefficiency. Based on prior studies, I further examine the link between business strategy, accounting conservatism and investment efficiency.
My research is based on the U.S. publicly traded companies from 2010 to 2017. I conclude that conservatism could mitigate the level of future over-investment of Prospector firms, whereas there is no obvious mitigation of the level of future under-investment for Defenders. My results are robust to plenty of checks, for example, alternatives of conservatism proxies, the Ordinary least squares regression for only Prospectors and Defenders business strategy (excluding Analyzers), and an alternative measure of investment efficiency.
|
|---|
