Accounting and Causal Effects: Econometric Challenges

In this book, we synthesize a rich and vast literature on econometric challenges associated with accounting choices and their causal effects. Identification and es- mation of endogenous causal effects is particularly challenging as observable data are rarely directly linked to the causal effect of interest. A common strategy is to employ logically consistent probability assessment via Bayes’ theorem to connect observable data to the causal effect of interest. For example, the implications o...