Social Desirability Bias and Earnings Management around the World

Paweł Niszczota


In this paper we test whether inter-country variation in individuals’ tendency to conform, as measured by the Lie (social desirability) scale used in the Eysenck Personality Questionnaire, can explain differences in the propensity to employ corporate earnings management around the world. Such a link is feasible, given that survey data suggest executives tend to be under severe pressure to meet earnings benchmarks, to which they often succumb by engaging in earnings management (to the detriment of the company’s long-term prospects). We hypothesize that in countries where the propensity to act in a socially desirable (outsider-satisfying) way is stronger, earnings management should be more prevalent. Research results support our hypothesis, and demonstrate the existence of a positive relationship between the prevalence of earnings management in a country and the mean score of individuals from that country on the Eysenck Lie scale, which further evidences that capital market pressure is a significant determinant of earnings management
Author Paweł Niszczota (WGM / KFM)
Paweł Niszczota,,
- Department of International Finance
Journal seriesInternational Journal of Management and Economics, ISSN 2299-9701, (B 12 pkt)
Issue year2015
Publication size in sheets0.7
Keywords in Englishpersonality traits, impression management, conformity, earnings manipulation, financial reporting
Languageen angielski
Score (nominal)12
ScoreMinisterial score = 12.0, 10-11-2019, ArticleFromJournal
Ministerial score (2013-2016) = 12.0, 10-11-2019, ArticleFromJournal
Publication indicators WoS Citations = 0
Citation count*3 (2021-06-09)
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