The New Palgrave Dictionary of Economics

Living Edition
| Editors: Matias Vernengo, Esteban Perez Caldentey, Barkley J. Rosser Jr

Accounting and Economics

Living reference work entry

Latest version View entry history



Accounting provides an important source of economic measures, yet consistently falls short of the economist’s conceptual ideal. This shortfall is fodder for economic research, is the result of economic forces, and is the key to making the best possible use of these measures.


Accounting and economics Auditing regulation Depreciation Financial Accounting Standards Board (FASB) Generally Accepted Accounting Principles (GAAP) Historical-cost accounting Information school of accounting International Accounting Standards Board (IASB) Measurement school of accounting 

JEL Classifications

This is a preview of subscription content, log in to check access.



Helpful comments by Haijin Lin and David Sappington are gratefully acknowledged.


  1. Anderson, S., J. Hesford, and M. Young. 2002. Factors influencing the performance of activity based costing teams: A field study of ABC model development time in the automobile industry. Accounting, Organizations and Society 27: 195–211.CrossRefGoogle Scholar
  2. Ball, R., and P. Brown. 1968. An empirical evaluation of accounting income numbers. Journal of Accounting Research 6: 159–178.CrossRefGoogle Scholar
  3. Beaver, W. 1998. Financial reporting: An accounting revolution. Englewood Cliffs: Prentice-Hall.Google Scholar
  4. Butterworth, J. 1972. The accounting system as an information function. Journal of Accounting Research 10: 1–27.CrossRefGoogle Scholar
  5. Canning, J. 1929. The economics of accountancy. New York: Ronald Press.Google Scholar
  6. Chambers, R. 1966. Accounting, evaluation and economic behavior. Englewood Cliffs: Prentice-Hall.Google Scholar
  7. Christensen, J., and J. Demski. 2002. Accounting theory: An information content perspective. New York: McGraw-Hill/Irwin.Google Scholar
  8. Clark, J. 1923. Studies in the economics of overhead costs. Chicago: University of Chicago Press.Google Scholar
  9. Debreu, G. 1959. Theory of value: An axiomatic analysis of economic equilibrium. New Haven: Yale University Press.Google Scholar
  10. Demski, J. 2003. Corporate conflicts of interest. The Journal of Economic Perspectives 17 (2): 51–72.CrossRefGoogle Scholar
  11. Edwards, E., and P. Bell. 1961. The theory and measurement of business income. Berkeley: University of California Press.Google Scholar
  12. Feltham, G. 1972. Information evaluation. Sarasota: American Accounting Association.Google Scholar
  13. Hicks, J. 1946. Value and capital. Oxford: Clarendon Press.Google Scholar
  14. Ijiri, Y. 1975. Theory of accounting measurement. Sarasota: American Accounting Association.Google Scholar
  15. Krantz, D., R. Luce, P. Suppes, and A. Tversky. 1971. Foundations of measurement. New York: Academic.Google Scholar
  16. Mock, T. 1976. Measurement and accounting information criteria. Sarasota: American Accounting Association.Google Scholar
  17. Morgenstern, O. 1965. On the accuracy of economic observations. Princeton: Princeton University Press.Google Scholar
  18. Paton, W. 1922. Accounting theory. New York: Ronald Press.Google Scholar
  19. Petrick, K. 2002. Corporate profits: Profits before tax, profits tax liability, and dividends, Methodology paper. Washington, DC: Bureau of Economic Analysis. Online. Available at Methpap/methpap2.pdf. Accessed 18 Nov 2005.
  20. Ross, S. 2004. Neoclassical finance. Princeton: Princeton University Press.Google Scholar
  21. Solomons, D. 1965. Divisional performance: Measurement and control, 1965. New York: Financial Executives Research Foundation.Google Scholar
  22. Wilson, R. 1983. Auditing: Perspectives from multiperson decision theory. The Accounting Review 58: 305–318.Google Scholar

Authors and Affiliations

  1. 1.