The Market's Response to the 1974 LIFO Adoptions
研究1974-1975年高通胀时期，400多家公司改用后进先出法（LIFO）后股票价格的反应，发现这些公司在年报发布期间出现负异常回报。
In this paper I report the results of a study of stock price reactions to LIFO adoptions in 1974 and 1975. These two years were characterized by high levels of inflation and wide swings in stock prices, and more than 400 firms on the New York and American Stock Exchanges switched to LIFO. Previous studies (see below) provide conflicting results of the market's reaction to LIFO adoptions. These studies exhibit certain research design and small sample limitations which prevent one from resolving the issue of how the market reacts to LIFO switches. Using a better matched-pair design and a larger sample, I conclude that LIFO adopters suffered negative abnormal return performance during the period surrounding their annual earnings announcements. While several possible explanations for this result are discussed, additional research is needed to provide further insight into the nature of the market reaction to LIFO adoption.