Pincus (2000), Internal versus external equity funding sources and earnings response coefficients
Permanent versus transitory components of annual earnings and estimation error in earnings response coefficients
The results showed the increased ability of the price and return models to explain better earnings-return relationship by providing highly significant earnings response coefficients
The effects of backdating on earnings response coefficients
Kothari, 1989, "An Analysis of Intertemporal and Cross-Sectional Determinants of Earnings Response Coefficients
," Journal of Accounting and Economics 11, 143-181.
2005 in the US, and Chen, Chen, and Su, 2001 in China) all regression results in Table 3 show that the earnings response coefficients
(ERC), relating stock returns to the level and change in earnings, are positive and significant.
Based on nonaudit fees from 1978-80, the evidence indicates that smaller earnings response coefficients
are associated with higher auditor provided nonaudit services.
Earnings Response Coefficients
Levels Associated With Dividend Yield
We expect that, if auditors' industry specialization results in greater audit quality, industry specialization would be negatively associated with clients' discretionary accruals and positively associated with clients' earnings response coefficients
Inter-temporal decline in earnings response coefficients
Next, in order to test for a statistical difference in the magnitude of the earnings response coefficients
in the two groups of firms, I introduce a dummy variable that represents the level of economic development (i.
Overall, the results indicate that, consistent with Freeman and Tse (1992), earnings response coefficients
are decreasing in the magnitude of earnings surprise.