4.3 Negativity Analysis
In order to manage the content analysis of such a large sample of comment letters,
whilst maintaining objectivity, extracted words were compared to modal word lists to
assess the level of negativity in each letter. The political nature of the accounting
standard setting process, potentially, makes interested parties cautious of explicitly
opposing the standard setter in case it may hinder their influence. For the same reason,
the level of positivity in the letters may be misleading as a measure of consent. In
addition, discontent may be wrapped in positivity by negating the positive words.
Tetlock (2007) and Loughran and McDonald (2011) note that measuring positivity is
of limited use for this reason. On the other hand, negativity in the discussion of a
proposal is unnecessary unless there is opposition. This is, therefore, a key variable to
explore lobbyists’ potential for successfully blocking proposals from becoming
accounting standards. Measuring negativity circumvents the noise from using positive
word lists and allows the analysis to capture even that part of the sample which avoids
explicit opposition, yet makes its discontent with the proposal known to the standard
setter.