Does ownership structure reduce earnings manipulation practice of Egyptian listed firms? Evidence from a dynamic panel threshold model

Abstract This paper analyzes the nonlinear relationship between corporate ownership structure and income manipulation through accrual-based earnings management in Egyptian context. To do so, we develop a sample of 78 listed non-financial firms, covering period 2008–2017. Using dynamic panel threshold analysis approach (Seo Shin J Econom 195: 169–186, 2016), found manipulations. proves presence an optimal below which generates entrenchment effect on management. However, above this threshold, has alignment effect. Certainly, these results confirm theoretical predictions relation to managerial ownership, governmental (agency, political development theories, respectively). These yield important policy implications. It is recommended set control firm`s managers. likely avoid