The Strategic Interaction between Committing and Detecting Fraudulent Misreporting

摘要: The paper considers an agency model of fraudulent misreporting which implies a rich set relationships between the commission fraud, observation or detection economic performance, and compensation policy firm. develops number testable empirical implications highlights several interesting phenomena, including on exogenous variables that can cause increase in amount fraud committed but decrease being observed (and visa versa). Thus, studies seek to identify firm managerial characteristics associated with cannot infer relationship by simply examining how varies these characteristics. In addition, also shows industry’s growth potential industry fall from high-productivity pooling equilibrium (with high levels incentive effort and, as result, many firms) lower-productivity mixed-strategy lower fewer firms), resulting drop performance.