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Productivity Growth in the Public Accounting Industry: The Roles of Information Technology and Human Capital
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Productivity Growth in the Public Accounting Industry: The Roles of Information Technology and Human Capital

Hsihui Chang, Jengfang Chen, Rong-Ruey Duh and Shu-Hsing Li
Auditing : a journal of practice and theory, v 30(1)
01 Feb 2011

Abstract

Business & Economics Business, Finance Social Sciences
In this paper we decompose productivity growth into four components: efficiency change, technical progress, information technology (IT) capital accumulation, and human capital accumulation. We analyze data on the operations of 51 public accounting firms in Taiwan for the years 1993 and 2003, and find that productivity growth was driven primarily by the accumulation of IT capital and human capital. We also find that the difference in productivity growth between Big 4 and non-Big 4 accounting firms is attributable to technical progress and, especially, IT capital accumulation. Further, our multiple regression results indicate that accounting firms that had high growth in non-audit services (NAS) during the 11-year period enjoyed significantly higher productivity growth through greater IT capital and human capital accumulation than firms that remained focused on traditional audit services.

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Web of Science research areas
Business, Finance
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