An empirical test of spatial competition in the audit market

作者：Numan Wieteke; Willekens Marleen^*

来源：Journal of Accounting and Economics, 2012, 53(1-2): 450-465.

DOI：10.1016/j.jacceco.2011.10.002

• Audit markets
• Price competition
• Industry specialization
• Differentiation

This study empirically examines the effects of competition through differentiation on audit pricing. Based on prior economic theory on differentiated-product markets (e.g., Hotelling, 1929: Tirole, 1988), we hypothesize that audit fees are affected by an auditor's relative location in a market segment. We define audit markets per industry segment and U.S. Metropolitan Statistical Area and specify an auditor's industry location relative to the client (auditor-client industry alignment) and relative to the closest competitor (industry market share distance to closest competitor). We find that audit fees increase in both auditor-client industry alignment and industry market share distance to the closest competitor.

• 出版日期2012-4