Changes in the value-relevance of earnings and book values over the past forty years

@article{Collins1997ChangesIT,
  title={Changes in the value-relevance of earnings and book values over the past forty years},
  author={D. Collins and Edward L. Maydew and Ira S. Weiss},
  journal={Journal of Accounting and Economics},
  year={1997},
  volume={24},
  pages={39-67}
}
  • D. Collins, Edward L. Maydew, Ira S. Weiss
  • Published 1997
  • Business, Economics
  • Journal of Accounting and Economics
  • This paper investigates systematic changes in the value-relevance of earnings and book values over time. We report three primary findings. First, contrary to claims in the professional literature, the combined value-relevance of earnings and book values has not declined over the past forty years and, in fact, appears to have increased slightly. Second, while the incremental value-relevance of "bottom line" earnings has declined, it has been replaced by increasing value-relevance of book values… CONTINUE READING
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