Budget deficits and asset sales∗

Budget deficits, inflation risk, and asset prices

Kitchen examines how US budget deficit news affects asset prices and concludes that news of lower deficits reduces the inflation risk premium. This paper constructs narrative histories of several deficit-reduction laws to identify when markets learned that deficits would fall. It then estimates a multi-factor model that allows the inflation risk premium to vary following news of deficit-reducti...

Evidence on Asset Sales and Income Management: Case of Iran

This study empirically examines whether managers manipulate reported income through the timing of sales of long-lived assets and investments. Several empirical implications of the income-smoothing and debt-equity hypothesis in the context of asset sales were tested. The findings are consistent with the timing of asset sales by managers so that the recognized accounting income from these sales s...

Income from Asset sales, Earnings Change, and Leverage

Due to the fact that assets are recorded at their historical value and they may include unrealized gains (losses), managers may manipulate earnings through the sale of these assets and provide financial information which is not accurate and reliable. The aim of this study is to investigate the relationship between income from asset sales, earnings change and leverage of companies listed on Tehr...

Optimal Budget Deficits

evidence on asset sales and income management: case of iran

this study empirically examines whether managers manipulate reported income through the timing of sales of long-lived assets and investments. several empirical implications of the income-smoothing and debt-equity hypothesis in the context of asset sales were tested. the findings are consistent with the timing of asset sales by managers so that the recognized accounting income from these sales s...