The significance of survey sampling as a useful tool for accounting has become more apparent in recent years. There is increasing evidence that accountants should become familiar with the characteristics of the various sample designs. It has been argued that the methods of statistical sampling can benefit accountants and auditors in two ways. First, the methods permit them to make' mathematically supportable estimates of Universe characteristics and second, because sampling is used in lieu of 100 percent count or itemization, the timeliness of reports to management can be increased. This article reports on one such instance, the verification of a physical inventory of motor vehicles of the U. S. Air Force by the Auditor General of the U. S. Air Force. The system for controlling and reporting vehicles within the Air Force is quite strong if it is followed. Essentially, the system requires that, at the time of procurement, a registration number will be assigned by the vehicle prime depot and a permanent registration card will be prepared in triplicate.

Among 188 countries, 72 had no state religion in 2000,1970, and 1900; 58 had a state religion throughout; and 58 had 1 or 2 transitions. We use a Hotelling spatial competition model to analyze the likelihood that the religion market would be monopolized. Similar forces influence a government's decision to establish a state religion. Consistent with the model, the probability of state religion in 1970 and 2000 is increasing with the adherence rate to the main religion, has a nonlinear relation with population, and has little relation with per capita GDP. The probability of state religion decreases sharply under Communism, but lagged Communism has only a weak effect. With costly adjustment for institutions, the probability of state religion in 1970 or 2000 depends substantially on the status in 1900. This persistence is much stronger for countries with no major regime change than for countries with such a change.

The purpose of this paper is to estimate the parameters of household preferences that determine the allocation of goods within the period and over the life cycle, using micro data. In doing so we are able to identify important effects of demographics, labour market status and other household characteristics on the intertemporal allocation of expenditure. We test the validity of the life-cycle model using excess sensitivity tests and find that controlling for demographics and labour market status variables can largely explain the excess sensitivity of consumption to anticipated changes in income.

We take up Cochrane’s (2011) challenge to identify the firm characteristics that provide independent information about average U.S. monthly stock returns by simultaneously including 94 characteristics in Fama-MacBeth regressions that avoid overweighting microcaps and adjust for data-snooping bias. We find that while 12 characteristics are reliably independent determinants in non-microcap stocks from 1980 to 2014 as a whole, return predictability sharply fell in 2003 such that just two characteristics have been independent determinants since then. Outside of microcaps, the hedge returns to exploiting characteristics-based predictability also have been insignificantly different from zero since 2003. Received January 28, 2015; editorial decision November 28, 2016 by Editor Andrew Karolyi.

This paper examines daily excess bond returns associated with announcements of additions to Standard and Poor's Credit Watch List, and to rating changes by Moody's and Standard and Poor's. Reliably nonzero average excess bond returns are observed for additions to Standard and Poor's Credit Watch List when an expectations model is used to classify additions as either expected or unexpected. Bond price effects are also observed for actual downgrade and upgrade announcements by rating agencies. Excluding announcements with concurrent disclosures weakens the results for downgrades, but not upgrades. The stock price effects of rating agency announcements are also examined and contrasted with the bond price effects.

We study whether the repricing of employee stock options is in the best interests of common shareholders by examining the excess stock returns associated with timely, noncontamin‐ated repricing announcements made by Canadian firms. On the basis of three theories of why firms reprice, we develop competing predictions about the mean announcement‐date excess stock return and the cross‐sectional relations among excess stock returns, the estimated probability of repricing, and proxies for predictions from each theory. For a sample of 72 noncontaminated repricing announcements made by Canadian firms between November 1994 and July 2001, we find a reliably positive three‐day announcement‐date mean excess return of 4.9 percent. The results of our cross‐sectional analyses suggest that the market responds favorably to repricings because they assist in retaining key employees even though, at the margin, they enable managers to extract rents from shareholders. We do not find sufficient statistically significant evidence to reliably conclude that repricings are done to realign employee incentives.

Credence goods are characterized by informational asymmetries between sellers and consumers that invite fraudulent behaviour by sellers. This article presents a natural field experiment on taxi rides in Athens, Greece, set up to measure different types of fraud and to examine the influence of passengers' presumed information and income on the extent of fraud. We find that passengers with inferior information about optimal routes are taken on significantly longer detours, while lack of information on the local tariff system increases the likelihood of manipulated bills by about fifteen percentage points. Passengers' perceived income seems to have no effect on fraud.