Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 13, 2022 erstellt
Beschreibung:
This study investigates how accounting information plays a role in macroeconomy. Decision makers in the economy extract information embedded in aggregate investment, leading to asymmetric uncertainty in their social learnings. Learning asymmetry induces a business cycle asymmetry commonly known as "slow boom, sudden bust." It also causes misallocations of economic resources, resulting in aggregate underinvestment. We explore the effect of accounting asymmetry on business cycle asymmetry and aggregate underinvestment. We show that, compared with neutral accounting, downward biased accounting mitigates learning asymmetry, thereby ironing out business cycles and improving the aggregate investment efficiency. This study identifies asymmetric accounting as a novel and low-cost macroeconomic policy instrument. Moreover, it sheds light on the macroeconomic consequences of neutrality in the FASB's and the IASB's conceptual frameworks