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Accounting and Economics

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Abstract

Broadly viewed, economics is concerned with the production and allocation of resources, and accounting is concerned with measuring and reporting on the production and allocation of resources. Corporate financial reporting, income tax reporting, and product cost analysis at the firm level are familiar accounting activities. Of course, accounting itself is a production process, and the production and allocation of its output is even regulated; for example, how a firm measures and reports its financial progress and how a firm communicates with outsiders are regulated, and auditing of a firm’s public financial statements is mandatory. This suggests two interrelated themes: accounting is useful in a wide variety of activities, including economics research, and accounting itself is a fascinating and important area of economics research.

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© 2008 Palgrave Macmillan, a division of Macmillan Publishers Limited

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Demski, J.S. (2008). Accounting and Economics. In: Durlauf, S.N., Blume, L.E. (eds) The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-58802-2_6

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