Honesty and Intermediation : Corporate Cheating, Auditor Involvement and the Implications for Development

• Main Author: Guha, Brishti
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2007
• Subjects: Business Law, Public Responsibility, and Ethics; Industrial Organization
• Online Access: https://ink.library.smu.edu.sg/soe_research/1015
• Institution: Singapore Management University

We examine self-enforcing honesty in firm-investor relations in an imperfect public information game. Minimum firm size requirements and moral hazard limit ability to raise outside capital, yielding a floor on personal wealth required to enter entrepreneurship. Credible auditing could create efficie...