Knowing What Others Know: Common Knowledge, Accounting, and Capital Markets
AbstractThe concept of common knowledge concerning higher orders of knowledge has seen exciting new developments in the fields of philosophy, game theory, statistics, economics and cognitive science in the recent decades. Even though information lies at the heart of accounting and capital markets research, these new developments have had only a faint echo in these fields. Common knowledge thinking may significantly advance our understanding of financial reporting, analysis, securities valuation, managerial control, auditing and information systems. Such accounting and business applications will also make important contributions in the form of concrete real life examples and applications to the basic fields where the idea of common knowledge originated. This paper is an overview of common knowledge and its actual and potential applications to accounting and capital markets research.
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Bibliographic InfoPaper provided by Yale School of Management in its series Yale School of Management Working Papers with number ysm213.
Date of creation: 08 Aug 2001
Date of revision:
Common Knowledge; Accounting; Capital Markets; Beliefs About Others' Beliefs;
Other versions of this item:
- Shyam Sunder, 2001. "Knowing What Others Know: Common Knowledge, Accounting, and Capital Markets," Yale School of Management Working Papers ysm326, Yale School of Management, revised 01 Feb 2002.
- G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
- M41 - Business Administration and Business Economics; Marketing; Accounting - - Accounting - - - Accounting
- D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
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