In pairwise comparisons of relative information content, adjusted R2s are
largest for EBEI in every two-year period. However, in 1984—85 differences
between EBEI, EVA and RI are not statistically significant at conventional
levels. Using a 5% cutoff, in 1986—87, EBEI does not outperform RI (p"0.072)
but does outperform EVA (p"0.045). In 1988—89 and 1990—91, EBEI outperforms
each of the other performance measures at the 0.01 level or better. In
1992—93, EBEI does not outperform RI (p"0.083) but does outperform EVA
(p"0.006). Taken together, there is no evidence of EVA (RI or CFO) dominating
EBEI. Thus we again cannot support the Stern Stewart claim that EVA has
greater information content than earnings. In contrast, the evidence points to
earnings having higher relative information content in many sub-period