IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Consistent estimation of conditional conservatism

Listed author(s):
  • Núñez-Nickel, Manuel
  • Cano Rodríguez, Manuel

In this paper, we propose an econometric model that presents three advantages in relation to the Basu model: (1) it is robust to the aggregation problem; that is, we prove that the Basu model produces inconsistent estimations of conditional conservatism and that this problem is solved with our proposal; (2) it can produce firm-specific measures of conservatism by using time-series; and (3) it completes the understanding of the intercept in the Basu model by breaking it down between unconditional conservatism and the reversion of the differences between market and book values of equity. In other words, we can provide firm-specific measures of both conditional and unconditional conservatism with the same model. We demonstrate all these theoretical assertions using simulated data

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by Instituto para el Desarrollo Empresarial (INDEM) in its series INDEM - Working Paper Business Economic Series with number id-10-07.

in new window

Date of creation: Nov 2010
Handle: RePEc:cte:idrepe:id-10-07
Contact details of provider: Web page:

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:cte:idrepe:id-10-07. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ana Poveda)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.