How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs
The study of periods of market euphoria, such as Holland’s seventeenth-century tulip mania, England’s eighteenth-century South Sea Company, America’s nineteenth-century railroads, or, most recently, the U.S. housing market, is a topic of long-standing interest to economists. Theorists specify cond...
| Main Authors: | , , , |
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| Format: | Article |
| Language: | en_US |
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Wiley Blackwell
2013
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| Online Access: | http://hdl.handle.net/1721.1/76355 https://orcid.org/0000-0002-2221-5198 |
| _version_ | 1826201089477705728 |
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| author | Weber, Joseph P. Rice, Sarah Leone, Andrew J. Willenborg, Michael |
| author2 | Sloan School of Management |
| author_facet | Sloan School of Management Weber, Joseph P. Rice, Sarah Leone, Andrew J. Willenborg, Michael |
| author_sort | Weber, Joseph P. |
| collection | MIT |
| description | The study of periods of market euphoria, such as Holland’s seventeenth-century tulip
mania, England’s eighteenth-century South Sea Company, America’s nineteenth-century
railroads, or, most recently, the U.S. housing market, is a topic of long-standing interest to economists. Theorists specify conditions under which market participants and institutions cause "bubbles" to arise and persist and empiricists test participant-centric or institution- centric explanations (Hong, Scheinkman, and Xiong 2008; Schultz 2008; Greenwood and Nagel 2009). In this paper, we study a different participant other than one that stands to gain from price fluctuations. We are interested in how auditors behave during periods of market euphoria. Given their gatekeeper responsibility to act in the public’s interest, along with the seeming inevitability of bubbles (Rampell 2009), it is important to study how auditors behave during euphoric market conditions. To address this question, we examine auditor going-concern (GC) opinions around the time of the wave of stressed Internet firms filing to go public on NASDAQ, the capital markets entry point for the companies that went on to constitute "dotcom mania". |
| first_indexed | 2024-09-23T11:46:09Z |
| format | Article |
| id | mit-1721.1/76355 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T11:46:09Z |
| publishDate | 2013 |
| publisher | Wiley Blackwell |
| record_format | dspace |
| spelling | mit-1721.1/763552022-10-01T05:53:21Z How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs Weber, Joseph P. Rice, Sarah Leone, Andrew J. Willenborg, Michael Sloan School of Management Weber, Joseph P. The study of periods of market euphoria, such as Holland’s seventeenth-century tulip mania, England’s eighteenth-century South Sea Company, America’s nineteenth-century railroads, or, most recently, the U.S. housing market, is a topic of long-standing interest to economists. Theorists specify conditions under which market participants and institutions cause "bubbles" to arise and persist and empiricists test participant-centric or institution- centric explanations (Hong, Scheinkman, and Xiong 2008; Schultz 2008; Greenwood and Nagel 2009). In this paper, we study a different participant other than one that stands to gain from price fluctuations. We are interested in how auditors behave during periods of market euphoria. Given their gatekeeper responsibility to act in the public’s interest, along with the seeming inevitability of bubbles (Rampell 2009), it is important to study how auditors behave during euphoric market conditions. To address this question, we examine auditor going-concern (GC) opinions around the time of the wave of stressed Internet firms filing to go public on NASDAQ, the capital markets entry point for the companies that went on to constitute "dotcom mania". 2013-01-23T17:39:19Z 2013-01-23T17:39:19Z 2012-04 Article http://purl.org/eprint/type/JournalArticle 0823-9150 1911-3846 http://hdl.handle.net/1721.1/76355 Leone, Andrew J. et al. “How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs*.” Contemporary Accounting Research (2012). https://orcid.org/0000-0002-2221-5198 en_US http://dx.doi.org/10.1111/j.1911-3846.2011.01146.x Contemporary Accounting Research Creative Commons Attribution-Noncommercial-Share Alike 3.0 http://creativecommons.org/licenses/by-nc-sa/3.0/ application/pdf Wiley Blackwell SSRN |
| spellingShingle | Weber, Joseph P. Rice, Sarah Leone, Andrew J. Willenborg, Michael How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs |
| title | How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs |
| title_full | How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs |
| title_fullStr | How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs |
| title_full_unstemmed | How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs |
| title_short | How Do Auditors Behave During Periods of Market Euphoria? The Case of Internet IPOs |
| title_sort | how do auditors behave during periods of market euphoria the case of internet ipos |
| url | http://hdl.handle.net/1721.1/76355 https://orcid.org/0000-0002-2221-5198 |
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