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Financial Reporting and the Austrian Theory of Entrepreneurship
Author(s) -
YOUNG S. DAVID
Publication year - 1987
Publication title -
abacus
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.632
H-Index - 45
eISSN - 1467-6281
pISSN - 0001-3072
DOI - 10.1111/j.1467-6281.1987.tb00135.x
Subject(s) - disequilibrium , valuation (finance) , economics , entrepreneurship , accounting , asset (computer security) , austrian school , accounting records , finance , accounting information system , neoclassical economics , medicine , computer security , computer science , ophthalmology
The Austrian School of economics, with its emphasis on the market as a process and the role of the entrepreneur as the catalyst of that process, sheds new light on the social role of accounting. This paper examines the implications of the School's teachings to financial reporting, including its insistence on relegating accounting to the role of retrospective economic calculation, and the use of current cash equivalents for asset valuation. The Austrian School's replacement of neo‐classical general equilibrium theory with a dynamic model of the market process offers accounting researchers some relief of having to cope with the real world of error, discovery, and disequilibrium.