This study includes all available observations on the annual industrial and research Compustat databases for the years 1976-1994 which meet minimal data requirements.2 Banks, financial institutions, and firms in regulated industries (e.g., utilities) were deleted.3 In the results reported below, we focus on net income (NI, Compustat data item # 172). However, the main results were also computed for earnings before extraordinary items (Compustat data item # 18) and the results are generally consistent for these two alternative measures of earnings
This study includes all available observations on the annual industrial and research Compustat databases for the years 1976-1994 which meet minimal data requirements.2 Banks, financial institutions, and firms in regulated industries (e.g., utilities) were deleted.3 In the results reported below, we focus on net income (NI, Compustat data item # 172). However, the main results were also computed for earnings before extraordinary items (Compustat data item # 18) and the results are generally consistent for these two alternative measures of earnings
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