Take Action

Home | Faculty & Research Overview | Research

Research Details

Classifications Manipulation and Nash Accounting Standards, Journal of Accounting Research


This paper studies a model of Classifications Manipulation in which accounting reports consist of one of two binary classifications, preparers of accounting reports prefer one classification over the other, and accounting standards designates the official requirements that have to be met to receive the preferred classification, and preparers may engage in classifications manipulation in order to receive their preferred accounting classification. The possibility of classifications manipulation creates a distinction between the official classification described in the statement of the accounting standard and the de facto classification, determined by the shadow standard actually adopted by preparers. The paper studies the selection and evolution of accounting standards in this context. Among other things, the paper evaluates efficient accounting standards, it determines when there will be standards creep, it introduces and analyses the notion of a Nash accounting standard, and it compares the standard set by sophisticated standard setters to those set with less knowledge of firms financial reporting environments.




Ronald A. Dye

Date Published



Dye, Ronald A.. 2002. Classifications Manipulation and Nash Accounting Standards. Journal of Accounting Research.(4): 1125-1162.


Explore leading research and ideas

Find articles, podcast episodes, and videos that spark ideas in lifelong learners, and inspire those looking to advance in their careers.
learn more


Review Courses & Schedules

Access information about specific courses and their schedules by viewing the interactive course scheduler tool.


Discover the path to your goals

Whether you choose our Full-Time, Part-Time or Executive MBA program, you’ll enjoy the same unparalleled education, exceptional faculty and distinctive culture.
learn more