The Role of Shorting, Firm Size, and Time on Market Anomalies

2012 ◽  
Author(s):  
Ronen Israel ◽  
Tobias Moskowitz
Keyword(s):  
Firm Size ◽  
Market Anomalies

The role of shorting, firm size, and time on market anomalies

2013 ◽  
Vol 108 (2) ◽  
pp. 275-301 ◽  
Author(s):  
Ronen Israel ◽  
Tobias J. Moskowitz
Keyword(s):  
Firm Size ◽  
Market Anomalies

The Market for Audit Services: The Role of Market Power

2020 ◽  
Vol 19 (3) ◽  
pp. 3-8
Author(s):  
Tracy Ti Gu ◽  
Dan A. Simunic ◽  
Michael T. Stein ◽  
Minlei Ye ◽  
Ping Zhang
Keyword(s):  
Market Power ◽  
Firm Size ◽  
Academic Research ◽  
Audit Fees ◽  
Local Market ◽  
Capital Investments ◽  
Audit Firm ◽  
Big 4 ◽  
The Subject

ABSTRACT The market for audit services has been the subject of extensive academic research since the 1970s. The prevailing view is that audit markets are characterized by tiers of suppliers (Big 4 versus non-Big 4, and industry specialists versus non-specialists) where the upper tier suppliers produce and sell a systematically higher level of assurance, while competition among suppliers within tiers is essentially perfect and a uniform price prevails within the submarkets. We discuss three papers that challenge this orthodoxy. These papers argue and find that the price of an audit is essentially unique to each (auditor, client) pair and that this price depends on both audit firm size and client size. Furthermore, audit firm size is linked with the firm's capital investments, which enhance auditor efficiency and market power. We conclude that audit markets are atomistic and that local market power is an important determinant of audit prices and audit fees.

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