Positive accounting

Capital market

Financial capital

Cost of capital

Microeconomics

Accounting

Economics

Market economy

Market value

Financial accounting

Business

Mark-to-market accounting

Monetary economics

Accounting research

Valuation (finance)

Human capital

Financial economics

Finance

Accounting information system

Profit (economics)

Journal of Accounting and Economics

I review empirical research on the relation between capital markets and financial statements. The principal sources of demand for capital markets research in accounting are fundamental analysis and valuation, tests of market efficiency, and the role of accounting numbers in contracts and the political process. The capital markets research topics of current interest to researchers include tests of market efficiency with respect to accounting information, fundamental analysis, and value relevance of financial reporting. Evidence from research on these topics is likely to be helpful in capital market investment decisions, accounting standard setting, and corporate financial disclosure decisions.

Capital markets research in accounting