Technical Inefficiency, Allocative Inefficiency, and Audit Pricing

@article{Chang2017TechnicalIA,
  title={Technical Inefficiency, Allocative Inefficiency, and Audit Pricing},
  author={Hsihui Chang and Yi-Ching Kao and Raj Mashruwala and Susan M. Sorensen},
  journal={Journal of Accounting, Auditing \& Finance},
  year={2017},
  volume={33},
  pages={580 - 600}
}
The critical global role of audit firms, combined with the scarcity of qualified staff and downward pressure on fees, has increased the importance of understanding efficiency in this industry. This article examines the technical and allocative inefficiencies of audit firm staffing using data from 165 audit engagements performed by a Big 4 international certified public accountant (CPA) firm. Prior research has shown that the technical inefficiency of audit engagements leads to lower billing… Expand
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