Copyright ? 2001. AU Rights Reseved.

Behavioral Research in Accounting

Volume 1. 1989
Printed in USA

Behavioral Accounting in
Retrospect and Prospect*
Anthony G. Hopwoodt
London School of Economics and Political Science

ABSTRACT
This introductory essay comments on the four subsequent reviews of the
behavioral accounting literature. The essay emphasizes the factors that
have been implicated in the emergence of the behavioral accounting
literature, the cumulative progress that has been achieved and the need for
further work. Accepting the diversity of the human sciences, the discussion
also notes the problems that can emerge when one perspective is used to
encapsulate the perspectives and approaches of another. Hoping that in the
future behavioral accounting researchers will be able to articulate a more
mature intellectual stance, the essay elaborates on some of the ways in
which this might be achieved.

Accounting has come to be recognized as a phenomenon

whose form, functioning and consequences are interdependent
with the contexts in which it operates. From an economic
perspective, the roles and functioning of accounting are now
seen as being centrally
implicated in both the governance of enterprises and the operation
of
the financial markets. Equally, from a behavioral and organizational
perspective, accounting is now recognized as being a practice
whose
consequences are mediated by the human and social contexts in
which
it operates and the ways in which it intersects with other
organiza-
tional and social phenomena. A conception of a technical autonomy
for
accounting is one that both behavioral and economic researchers
have
made more difficult to sustain. From both pespectives, accounting
is
now seen as a phenomenon that both infuses and is infused by the
contexts in which it functions and the issues and agendas with
which it becomes involved.
• Invited Paper.
t My introductory comments for this inaugural issue of Behavioral Research in
Accounting only focus on the review papers that follow. This paper was drafted in
1988 during a visit to the Department of Accounting and Management Information
Systems at The Pennsylvania State University. I would like to thank my colleagues at
Penn State for the facilitative environment which they provide during my summer
visits and, on this occasion, for their helpful comments at a seminar during
which the main arguments in this paper were presented. I would particularly like to
acknowledge the many helpful comments provided by Mark Dirsmith and C. J.
McNair.
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The achievement of such a perspective is something of recent origin.

Although there were earlier scholars who articulated such a stance,
be it from the perspective of accounting's involvement in shifting
forms of social control, or on the basis of an awareness of the
possibilities for accounting calculations to disturb and disrupt
processes of economic decision making, the majority view, even
within the academic community, was of a more autonomous
and seemingly neutral technical practice, whose role was merely to
illuminate what is. Seen in such terms, the potential for a behavioral
and organizational, let alone a social, analysis of its functioning
was a distant one. Although economic perspectives certainly were
appealed to by earlier scholars, their role was almost invariably
one of enhancing the underlying technical rationality of accounting,
thereby striving to make it an even more adequate representational
practice.' In this way, conceptions drawn from economic theorizing
pervaded analyses of costing, income measurement, and divisional
performance measurement, but they did not at that time provide a
basis for either a normative or a descriptive appreciation of the
functioning of accounting in organizational and market settings.
The rise of an interest in both the economic and the behavioral and
organizational functioning of accounting required a radical shift in
the conception which researchers had of both accounting and the
task of accounting research. Rather than taking accounting for
granted, the development of such perspectives required a more
problematic view of the accounting endeavor. People had to start
worrying about how the functioning of accounting related to the
competitive provision of other sources of information on corporate
economic performance. They had to ask questions about how
accounting information was actually used and how it sometimes
seemed to generate seemingly undesirable and often quite
unanticipated consequences. They had to ponder on the
relationship between budgets and the process of budgeting.
Questions related to the capital market consequences of accounting
disclosures also needed to be raised, as did others which focused on
the relationship between accounting and other characteristics of
corporate performance.
Rather than reflecting an acceptance of the accounting status quo
or the conventional wisdoms associated with it, such questions, the
like of which provided the basis for the modern behavioral and
economic analysis of accounting, started to reflect more restless,
questioning, analytical, and even worrying minds. Instead of only
seeing accounting

Often the economists whose work was drawn upon in these contexts had more
complex views of the organizational and social possibilities for economic calculative
practices such as accounting. Accounting writers tended only to utilize the more
technical aspects of such works, however, ignoring the often quite rich and subtle
insights into their organizational and social functioning.
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research as a means for improving the technical rationality of

accounting as currently conceived, such a wider questioning of
accounting was emerging from an increasing willingness to conceive
of it in a broader organizational, managerial, and economic setting.
In some sense, it was as if the academic community needed to
start distancing itself from the conventionality of accounting (even if
later to return to it, as often happened) in order to ask questions of
it, probe into it, and to start worrying about it before there could be a
basis for a more serious examination of both the behavioral and
economic functioning of accounting.
The incentive for such a reorientation came from outside the
accounting academic community. As Caplan makes clear in his
personal view of the development of behavioral accounting, the
external appraisal and criticism of the state of American business
education provided the basis for a major restructuring of the
intellectual life and expectations of business schools. Rather than
merely propagating current practices and the conventional wisdoms
associated with them, the Pierson and Gordon and Howell reports
suggested that business education needed to be conceived of in a
more scientific manner, in the process drawing on the perspectives
of the wider behavioral and social sciences. As a result of these reports,
more emphasis started to be put on business research, academics
from the social sciences started to be recruited into the faculties of
business schools, and the expectations for both the quantity and
nature of scholarly research started to change.
Accounting research was to be greatly influenced by these develop-
ments, initially perhaps more indirectly than directly. Although there
were few possibilities for recruiting a new breed of accounting
researchers at that time, bases were established for at least new
dialogues between accounting academics and their colleagues in
psychology, economics, the new finance, quantitative analysis, and
so on. In this different environment, people could even start to reflect
on those nonaccounting studies of old, such as the investigations
of Argyris, Dalton, Roy and Whyte of the Chicago School of Sociology,
and Simon and his colleagues, which had focused on accounting but
had until then been relatively unappreciated by the accounting
academic community. More importantly, the changing
intellectual life of American business schools provided a basis
for a more serious, thorough, and scholarly approach to doctoral
research. In this way, students were brought into contact with the
intellectual and research traditions of the social sciences, be they
behavioral or economic in nature. Indeed, an amazing number of
the significant early developments noted in the subsequent review
papers occurred in the context of doctoral programs at Berkeley,
Carnegie Tech, Chicago, Ohio State, Stanford, and elsewhere.
Likewise for the rise of a new economic
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interest in accounting. By the late 1960s the external pressures for the
reorientation of American business schools were starting to result in a
new generation of accounting scholars.
Seen in such terms, the origins of both the new behavioral and
economic research traditions in accounting were very similar. Neither
represented a mainstream. Both were viewed with suspicion in many
circles, at least initially. It is worth remembering that one of the most
significant of the new economic papers (now honored by the American
Accounting Association) was rejected by The Accounting Review,
only to be published in the Journal of Accounting Research,• a
journal which owed its origin to the same set of institutional
changes. From these related origins, however, the behavioral and
economic research traditions were to diverge, albeit never
completely. There are times such as now when a certain
complementarity of interests exists in a few areas, and in times past
the decision rationality of an economic perspective has provided an
influential basis for behavioral research. The divergence,
moreover, was seemingly not to be an even one because an
economic approach to accounting was quite rapidly in a position
where many could perceive it as the mainstream research
orientation of the accounting academic community.
The reasons for the nature and form of the divergence have not been
explored in any systematic manner and all the subsequent reviews
of the behavioral research literature are silent on this point. In all
probability, quite a number of interesting factors were involved.
The new economic tradition was initially established in relatively few
institutions, in large part because the necessary configurations of
intellectual influences for efficient capital market based research were
themselves in relatively short supply. The institutions were themselves
prestigious ones, occupying central and influential positions in the
accounting academic community. Moreover, so focused, the research
tradition became more easily susceptible to the orchestrating
rationality of economics, a discipline that strictly polices both
intellectual innovations and its own boundaries. Quickly resulting in
complex empirical work and statistical testing, the new body of
research also provided a seemingly more meaningful haven for the
growing number of accounting academics who had a quantitative
orientation. The perspective also was emerging in accounting at a
time when modes of economic rationality and theorizing were
becoming of more general significance in institutional and social
governance. In contrast, as the review papers themselves
demonstrate, behavioral research emerged in a wide variety of
institutions. It was thereby subjected to a diversity

*Editor's note #1: The paper being referred to is Roy Ball and Philip Brown. "An
Empirical Evaluation of Accounting Income Numbers." Journal of Accounting
Research (Autumn 1968), pp. 159-178.
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of intellectual influences and, as a result, a much more heterogeneous

research tradition emerged. Moreover, many of the early innovating
institutions occupied less central positions in the invisible college that
constituted the accounting academic community at that time.
Although born in a similar context, the behavioral and the economic
research traditions were to be subject to different paths of develop-
ment, paths which themselves were to influence the forms that the
respective traditions were to take.
In the intervening period, however, the behavioral and organiza-
tional research tradition has progressed such that it now has a
substantial specialized literature, specialized journals and its own
professional groupings. A great deal has been achieved. More in
fact than is often realized. The unfocused discipline reviewed by
Burgs-
awl Sexmlem, satyaft as ..41- satunt.vrn .4s ito 'wan-me &sit-x-kits."
and "continuing weaknesses," stands in stark contrast to the
cumulative and substantive literatures reviewed by Birnberg and
Shields. Whilst no discipline is without shortcomings, and many are
indeed evident in the behavioral accounting area, one nevertheless
suspects that the former judgment has as much, if not more, to do
with the development of stereotypes than the exploration of a
complex and moving field. It is therefore extremely appropriate and
useful that the first issue of Behavioral Research in Accounting
provides a number of reviews and commentaries on the area.
It is a most appropriate and very helpful way for the new journal
to start.

A RICH, COMPLEX AND MOVING FIELD OF

INQUIRY
Birnberg and Shield's careful and systematic review of the
behavioral accounting literature portrays a rich and complex
area of research. They focus on the range of questions which
behavioral accounting research has come to address, illustrating in
each case not only the insights that have emerged but also the
cumulative processes of inquiry. Although the concerns that
constitute behavioral research in the accounting area are diverse,
and no doubt will remain so, Birnberg and Shields nevertheless
present a portrait of the area which emphasizes both the modalities
of inquiry which have come to structure the field and the very
real learning that has taken place. Moreover, they usefully
illustrate the various stimuli which have provided a means for
behavioral and organizational inquiry to advance, often by a
process of cross-fertilization between the various aspects of the field.
Choosing to focus on what might be termed the high points of the
literature they surveyed, the analysis which Birnberg and Shields offer
admittedly tends to be a generous one. With others illuminating the
problems that still abound in the more lowly sections of the field, it
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is
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useful to have an informed discussion of the insights that have been

gained and how, over time, cumulative progress has been
achieved.
The state-of-the-art of the field is, as Birnberg and Shields openly
and positively acknowledge, quite a rapidly moving one. New
emphases are emergent and, as with other dynamic areas of inquiry,
new issues, problems, perspectives, and methods are being
incorporated into the field. The present state of development,
however, is one such that Birnberg and Shields feel justified in
offering a positive characterization of the area, indeed it is now one
that contrasts with many of the stereotypes which others often want to
impose on its achievements. Although much undoubtedly remains
to be done and although research is still too variable in quality,
Birnberg and Shields are justified in emphasizing the
observational nature of behavioral accounting research, its
systematic nature, not least with relationship to behavioral
variations and comparisons, and the increasingly theoretically
orientated nature of the research process. They also stress the
applied nature of much of the work. Perhaps in contrast with many
views which are held by those outside the field, they point to the
mobilizing role that worries, questions, and problems concerning
accounting have played, and still do play, in shaping the nature of
behavioral and organizational inquiry in the accounting area.
Although methodological innovations have been particularly
important for the investigation of at least some problem areas, the
review presented by Birnberg and Shields attempts to
demonstrate how over time methods per se have not become a
concern in their own right. Rather they have played an active and
productive role in enabling more thorough, more focused, and more
valid explorations of substantive problems of interest to the
accounting community.
Possibly for the first time, Birnberg and Shields present a view of the
field that shows the coherent and cumulative progress that has been
achieved. Although the area is a complex one that is difficult to
characterize precisely, subject as it is to differing perspectives and
even rationalities, and although others might emphasize different
topics and conceptual frameworks, Birnberg and Shields nevertheless
show that over the years of its development behavioral and
organizational research in accounting has not progressed in a random
manner, merely consisting of a very large number of isolated
studies. Researchers in the field have been conscious of the
activities of both their predecessors and contemporaries. Learning
has taken place. Cumulative emphases and distinctions have
developed. Shared interests and perspectives, if not planned
research, have helped to forge what is now a richly patterned field of
inquiry. In these ways, a systematic body of knowledge has been
emergent.
That body of knowledge remains far from adequate, not least
because of the more intuitive processes that have resulted in
its
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growth. Important areas remain under-researched. In many areas

there is still not a sufficient degree of theoretical awareness. A lack of
vision permeates too many of the research efforts. Possibly as a
result, there remain too many inadequate studies, although, it has to
be said, this is not a feature of this area alone.
The research that has been undertaken thus far can provide an
interesting and indeed useful interpretative basis for
understanding and changing accounting in action. It is now
possible to offer a meaningful appreciation of the human and
organizational context of accounting. At the individual level, be it in
a management accounting or an auditing context, we are now in a
position to make sensible and potentially useful comments on the
functioning of accounting information systems. Phenomena such
as budgeting, standard setting and the interpretation of
management accounting information can now be conceived of in
ways that integrate them with the human and organizational
contexts in which they are embedded. The technical need no
longer be perceived in isolation of its setting. Whilst a great deal
still remains to be achieved at the organizational level of analysis,
we are nevertheless able to offer appreciations of the accounting
context that can provide a sensible basis for considering the design of
accounting systems in different environmental terrains, and that can
facilitate discussions about their human and organizational conse-
quences, be they anticipated or not.
Much of what Birnberg and Shields characterize as the "organiza-
tional sociology" school of research is orientated to the latter set of
issues. Perhaps more than most behavioral accounting researchers,
those working in this tradition have been fascinated by the sheer
diversity of accounting in practice and the heterogeneous ways in
which it can be implicated with organizational and social action. Being
uneasy with the universalizing techniques and rationales that pervade
many discussions of accounting, they have sought to probe into the
factors which influence how accounting is as it is, how it becomes
intertwined with the processes of organizing, and how it gives rise
to the behavioral, organizational, economic, and social
consequences that it does.
Adopting such a different research agenda, the organizational
researchers in accounting have appealed to a range of different
intellectual perspectives, research literatures, and modes of research
inquiry. Seen in such terms, it is not quite correct to unprob-
lematically label these as purely interpretative, as Birnberg and
Shields are tempted to do. Recognizing accounting diversity,
many such researchers have focused on enriching the perspectives
through which insights into the organizational practice of accounting
can be gained, but relatively few studies have been conducted in
strictly interpretative terms as this is conventionally understood
in the sociological
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literature. Being aware of the epistemological questionings in most

of the human sciences (with the possible exception of
economics), organizational researchers have been prepared to
recognize the constitutive as well as reflective properties of not only
accounting itself but also the knowledge we gain of it. That has also
provided them with a basis on which to distance themselves from the
simpler epistemological statements that characterize other
sections of the accounting literature. Being concerned with the
organizationally embedded functioning of accounting and the
dynamics of its change, they often have sought to study single cases
in quite considerable detail. Rarely have these methodological,
epistemological, and theoretical preferences been adopted by
researchers other than those who have a substantive concern with
enriching our understandings of accounting in action. Indeed, as
Birnberg and Shields recognize, such understandings are now
emerging.
Developing, as it is, in these and other ways, even the existing
body of knowledge of the behavioral and organizational
functioning of accounting can illuminate accounting as it is and as
it might become in ways that create a useful tension with many of the
orthodoxes and conventional wisdoms of the past. That is a very
real achievement.

A VIEW FROM WITHOUT

The review assembled by Burgstahler and Sundem is, in contrast, a
very different one. As outsiders to the field, albeit accounting
outsiders, they provide a view from without. Such a perspective has
the potential to be a useful one. In any field of inquiry, there are
dangers of introspection and it is often challenging to consider the
views of those who perceive developments from a different
perspective. As Burgstahler and Sundem themselves point out,
behavioral accounting research has been surveyed in the past by
distinguished members of the social science community. And
behavioral accounting research undoubtedly has benefited from that
experience.
The task undertaken by Burgstahler and Sundem is a difficult one.
The richness and complexity of the field which emerges from the
Birnberg and Shields survey creates considerable difficulties for an
outsider. It requires a very substantial investment of time to
appreciate the ebbs and flows of the research process, the cumulative
research strategies that have been adopted, the ways in which the
field has come to be structured and characterized, and the full
implications of the diversity of conceptual perspectives at play. It
would be a daunting enough task for a behavioral or organizational
researcher to survey the whole field of economics orientated research
in accounting from the early concerns with income and cost theory
through today's emphasis on efficient capital market studies,
agency theory, the
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economics of information and organization, and so on. Yet that

task is at least simplified by the presence of a unifying
assumption of a dominant rationality of behavior. Such an
orchestrating uniformity is not present in the behavioral and
organizational area, something that considerably increases the
difficulty of the outsider's endeavor. If the outsider speaks from
the specificity of just one of the human sciences, economics in
this case, in trying to disentangle the intellectual processes
at work in the behavioral and organizational analysis of
accounting, he or she must confront the ways in which the
intellectual energies of a wide variety of the other human
sciences have infused and influenced accounting research. Even
Birnberg and Shields could only deal with this difficulty by a
strategy of segmentation. The time for integration and synthesis
has not yet come, nor is it near.
Burgstahler and Sundem are therefore to be congratulated
on undertaking the task. Although I will comment on a
number of problems which I see in their approach, there are
nevertheless many aspects of their commentary which are useful
and which are worthy of further consideration by the behavioral
accounting research community. Not only is it useful to have an
explicit statement of how the area can be perceived from
without, but it is also useful to share their views on at least
some possibilities for the behavioral and economic
perspectives to provide a related view. It could well be that the
growing interest in the economics community in exploring the
process of organizing in a more subtle and nuanced way might
further this end.
The review offered by Burgstahler and Sundem is quite
explicitly a subjective and biased one. As their opening
statement reveals, they perceive themselves as looking into
behavioral accounting from a more mainstream perspective,
perhaps without realizing that the very viewpoint from which
they speak was itself one that was emergent and hardly
mainstream in earlier times—the times in fact when behavioral
accounting was itself trying to develop. Rather than offering a
view of the institutional and social as well as intellectual
processes through which prevailing conceptions of centrality
were shaped, somewhat unfortunately, I think, they choose to
offer an interpretation of a field that is perceived to be without
"focus" from the perspective of one whose contrasting
stability and relative homogeneity is seen in unproblematic
terms.
An understanding of the Burgstahler and Sundem analysis
therefore needs to be undertaken with some care. For one thing,
they attempt to impose on the behavioral accounting field a
framework for analysis emanating from economic reasoning.
"Consumers" and "producers" populate their discourse. They
explicitly state that they approach the review "from the
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perspective of an information economics view of the world," only

one of a range of possible economics perspectives. It is as if a
behavioral researcher were to appeal to economic sociology
to
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understand the problems inherent in the notions of economic

rationality implicit in the work of economics orientated accounting
researchers and to intellectual history to ground economic con-
ceptions of behavior in the social and political as well as economic
circumstances out of which they emerged. Both of these strategies
could be useful and interesting. They would provide a way of
grounding conceptions of the absolute and the inevitable that
pervade most areas of intellectual endeavor. Such approaches also
have their dangers, however, not least if the body of knowledge used
to review another merely functions as a way of calibrating the
achievements of the one in terms of the other. Without care such
an approach can provide a basis for a form of intellectual
imperialism that fails to recognize the human and socially
constituted nature of all bodies of knowledge and their own
specificities and particular foci.
The present state of development of the behavioral and organiza-
tional appreciation of accounting is now such that it can provide
insights which are not secondary to those of economics. The
behavioral perspective does not start where the economics
perspective can no longer function. It is not a residue. Rather it
provides a more positive and proactive perspective that can offer
alternative insights and analyses, even analyses of the
organizational and social nature of the economic and the specific
rather than generalized circumstances under which organizations
might appeal to economic reasoning to elaborate and shape their
modes of calculation and visibility.
Care also needs to be exercised in accepting the epistemological
premise that Burgstahler and Sundem would like to see underlying
their evaluative perspective. Although it might be tempting to
characterize their rejection of the applicability of notions of truth in
terms of their acceptance of postmodern philosophies of knowledge
which have, at the very least, introduced more complex notions of
truth into intellectual discussions, an analysis of their arguments
shows that much less is at stake. Not only is their stance towards the
real and the true a most equivocal one, pushing them at times to
question its applicability in an accounting context but also moving
them towards a concern with the validity of behavioral accounting
research, but they also pursue their mode of economic reasoning
beyond the confines pursued by economists themselves. Whilst
economics has come to provide a way of interpreting an extremely
broad spectrum of activities from love and marriage to crime,
economists very rarely apply economics to economics itself. The
discipline has not been noted for its reflexivity. To do so would make
economic pronouncements a mere temporary equilibrium of the
demand for and supply of economic understandings. Somehow
economists generally presume that more is at stake than that.
Even those economics orientated accounting researchers who
have per-
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ceived of the demand and supply of accounting theories in market

terms have been most careful not to see their own theoretical
activities in terms of their own theories, claiming, albeit silently and
implicitly, a more privileged epistemological position. *
Burgstahler and Sundem's theoretical position is therefore one of
some originality although unfortunately it is not one that is fully
developed in the subsequent review essay. Whilst it is useful to portray
accounting as an artifact subject to the contingencies of the
human and social world, including those of an economic nature,
Burgstahler and Sundem provide little insight into the nature of
their extension of a mode of economic reasoning to the analysis of
the knowledges that have arisen around accounting (including
presumably their own, unless they too claim exemption from their
own theories). They also show little awareness of the epistemological
problems that this might create. The issue is one of some
significance because the modern strands of both behavioral and
economic research in accounting emerged when the academic
community started to raise questions of accounting rather than
being merely content to apply knowledge to improving the
technical rationality of the accounting craft. Although the
distinction is certainly never a clear one, behavioral and economic
knowledge of accounting and of how it emerges and functions do
not have a one to one relationship with accounting itself.
Perhaps fortunately such perspectives, although quite explicitly
articulated by Burgstahler and Sundem, are only loosely related to the
review which they provide of the behavioral accounting literature. That
review was commissioned to be primarily a methodological and
thematic one rather than a substantive one of the type provided by
Birnberg and Shields.
Some interesting trends certainly emerge from the detailed analyses
undertaken by Burgstahler and Sundem, including some that confirm
and elaborate upon some of the developments analyzed by
Birnberg and Shields. And on a quite personal level, I found myself
fascinated by the insights they provided on the roles played by
Accounting, Organizations and Society. If nothing else, it
shows that the stewardship of the means of publication can be
important, an observation of some interest at a time when we
celebrate the launch of

• Editor's note #2: The reader may find the following useful reading in regard to the
argument presented by Hopwood:
Charles Christenson, "The Methodology of Positive Accounting," Accounting Review
(January 1983), pp. 1-22.
Ross L. Watts and Jerold L. Zimmerman, "The Demand for and Supply of Accounting
Theories: The Market for Excuses," Accounting Review (April 1979), pp. 273-305.
Ross L. Watts and Jerold L. Zimmerman. "Towards a Positive Theory of the
Determination of Accounting Standards," Accounting Review (January 1978). pp.
112-134.
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a new journal and can witness the implications of changes in the

editorship of others.
Burgstahler and Sundem's review then goes on to comment on some
"inherent difficulties of BAR." However, as Burgstahler and Sundem
themselves note, although they perceive that all the difficulties apply to
behavioral accounting research, most are not unique to it. That is
indeed the case. Even economics orientated research in accounting
now covers quite a broad field, having only a partial understanding
of the interrelationships within itself. Agency theory, the economics
of information, capital market studies, investment theory and so on
are all based on a unifying presumption of a certain mode of
rationality but their interdependencies and potential for
providing mutual insight are much underexplored, as most
economists realize.
The specific difficulties noted by Burgstahler and Sundem reflect a
number of evaluative stances. Within the diversity of the human
sciences, the difficulties of one discipline are sometimes perceived
as the strengths of another. Concerns with theorizing complexity
are high on the agenda of some disciplines whilst others have
invested heavily in theoretical simplicity. In some of the human
sciences, there have been growing concerns about the potential
for generalizable theories in recent years, their intellectual energies
being devoted to increasing the extent to which specific
circumstances can be made intelligible and amenable to human
interpretation. Other disciplines have invested instead in
increasing the rigor of their generalizing theories. Burgstahler and
Sundem's evaluative concerns seemingly show little appreciation of
such intellectual diversity or the rationales lying behind it. Even
some of Burgstahler and Sundem's areas for further improvement
in behavioral accounting research need to be considered with some
care. Different human sciences place different emphases on the role
of prediction. Interpretative and nonpositivistic research traditions
can and do play a role in more than merely "exploratory"
research. And different disciplines also tolerate differing degrees of
diversity.
One also senses that some of the emphases given by Burgstahler and
Sundem reflect the inherent difficulty of observing a complex field of
inquiry from without. Certainly they contrast with the albeit generous
but nevertheless more cumulative and substantive review provided by
Birnberg and Shields.
Be that as it may, Burgstahler and Sundem offer some telling
criticisms which, even when modified by their own more encouraging
outline of the more recent progress that has been achieved, I, as an
editor, recognize. Not least of these from my point of view is the
sheer extent to which behavioral accounting research has been
shaped by the academic control system. Despite all the signs of
improvement, a concern with ease, speed and the immediate
publishability rather than
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Behavioral Accounting in Retrospect and Prospect

the substance of the research still bedevils the area, although in this
respect it certainly is not unique.
As should be quite clear, I have adopted a specific stance in
commenting on the views articulated by Burgstahler and Sundem. My
rationale for doing this is an internally orientated one for the
behavioral and organizational accounting area, although not a
defensive one. It is important for behavioral and organizational
researchers in accounting to receive, ponder on and, on suitable
occasions, act on the views of outsiders. The field should not be
isolated. Nor should it be seen as being isolated. Equally, however, I
think that it is extremely important for behavioral and organizational
researchers to be conscious of the nature and specificity of their own
endeavors, of the intellectual traditions upon which they draw and
of the positions which they occupy or should attempt to occupy
within the spectrum of the diverse human sciences. Indeed, if I am
critical of behavioral accounting researchers it is that they do not live
up to this ideal. Too many appear to be unaware of their own
intellectual position. Too few can relate their research interests to
substantive developments in the human sciences. Insufficient
attention is given to increasing at least their awareness of their
epistemological position and the roles which can be attributed to
the research endeavor.
If behavioral accounting research were to invest more in
appreciating its own nature and position, I think that it would be a
stronger field. It could then listen with sympathy and
understanding to the views of outsiders. It could have a sounder
appreciation of their relevance or not for its own endeavors. It even
might be able to extend its own appreciations to complement
and intersect with those emanating from without, in the
process even developing some understandings of the
organizational and social preconditions that give rise to an
interest in the economic and its translation into modes of economic
calculation, such as accounting.
MOVING THE RESEARCH AGENDA FORWARD
Caplan's personal commentary on the emergence and present
state of behavioral accounting provides some further useful
insights into both the forces mobilizing the development of the area
and what has been achieved to date. Not only does he stress the
influential role played by the wider intellectual restructuring of
American business education and research, but he also correctly
notes that the emergence of the behavioral study of accounting
needs to be seen in the context of the rise of an organizational
interest in the behavioral and social sciences. Seen in such terms,
it was not a fragmented and isolated development but rather one
whose intellectual ancestry needs to be related to a wider
understanding and management of the human and social aspects of
the enterprise.
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Turning to an analysis of the current state-of-the-art, Caplan offers a

more cautious view than Birnberg and Shields, even though a
behavioral accounting insider. Like Burgstahler and Sundem, he
puts a fair amount of emphasis on the narrowly conceived, method
driven and quickly undertaken studies that appear to result from at
least parts of the American academic culture. As I have said already,
they do tend to pervade parts of the area (although colleagues in other
fields of inquiry are prone to make the same comment). Even so, we
need to be careful about placing too much emphasis on the mass of
studies, disturbing though some of them may be. As Birnberg and
Shields and also the review by Lord made clear, progress in a
field is more frequently determined by a smaller number of
innovative studies. In the behavioral accounting area, like others,
these have tended to reflect learning, a cumulative process of
research and a healthy interdependency with other disciplines in
the human sciences. It would appear that many of these studies
then represent a new ideal against which numerous other more
focused and less innovative studies are compared. Moreover, it is
my experience that journal review processes speedily adjust to
the new states of knowledge, quickly making it more difficult for
the more marginal studies to enter into the public domain. Of course,
the process is not perfect, but it is very similar to those operating in
other fields of intellectual endeavor.
Seen in this way, there is not necessarily a conflict between the
substantive and cumulative review offered by Birnberg and Shields,
and the frustration articulated by Caplan and others. One reflects the
real achievements of the field, whilst the other may unfortunately still
reflect a large percentage of the studies undertaken, many of which
increasingly have difficulty getting published, however.
Even so, as Caplan quite rightly states, there is no need for
complacency. Behavioral accounting research is in need of
improvement and can be improved.
Mapping out any route for the future of behavioral and organiza-
tional research in accounting is bound to be a difficult and hazardous
task, easily reflecting personal preferences rather than likely
substantive developments in the field.
Caplan offers a quite cautious view of the future, being aware of the
continuing relative paucity of "individuals capable of doing high
quality behavioral research." In a related manner, Burgstahler and
Sundem put the emphasis on the need for an improved methodological
orientation, providing, in the process, a specific list of areas where
improvement is called for.
Birnberg and Shields point to both methodological and substantive
trends, being somewhat less evaluative of either. As far as method-
ological developments are concerned, they highlight the growing
significance and likely future development of expert systems and,
like
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Burgstahler and Sundem, experimental economics based research.

Both of these strands of development are indeed already emergent,
as is the substantive area emphasized by Birnberg and Shields,
namely the research being conducted within what they term the
"organizational sociology school." Although I am not as sure as
Birnberg and Shields that such patterns of development are likely
to result in a division of behavioral accounting research into a
"rational school" and "a subjectivistic school" since such a distinction
tends to prioritize a particular conception of rationality, I
nevertheless agree that there is some likelihood that such
developments will result in quite clearly differentiated and even
divergent research traditions. Not only might behavioral research
then be confronted more starkly with the problems of understanding
aggregation issues and the relationship between the individual,
organizational, and social levels of analysis that confront all the
human sciences, but also more of a tension might emerge
between those who emphasize the appreciative and interpretative
functions of research and those that put the stress on its more
immediate instrumental potential for facilitating the design of
accounting practices and systems.
The nature of such tensions is likely to be influenced in part by the
extent to which behavioral and organizational researchers move more
towards addressing, albeit in quite different ways, the problems of
practice. I, at least, think that the time is now right for research in the
area to try to grapple with the problems of understanding the technical
practice of accounting as well as its human and organizational
context. Existing research now provides an adequate basis for
doing this. Be it through studies of the factors replicated in the
emergence of different technical regimes of accounting, attempts to
gain a richer insight into the socio-technical functioning of
accounting, or improved understandings of the different human
and organizational consequences stemming from different
technical practices, a lot of accounting orientated knowledge is
more likely to be gained by research which systematically
attempts to study the interdependency and interpenetration of the
technical and the human and the organizational.
Indeed some, at least, of Caplan's concerns with the potential
impact of such research on practice might be addressed this way.
Although the relationships between research and practice are
complex and rarely direct, more concerns with understanding the
technical practice of accounting in its human and organizational
context might result in frameworks, categories for analysis, and
interpretative schemas that might help at least to structure our
understandings of practice. A more instrumental body of knowledge
is as likely, if not more likely, to develop in this way than through
attempts to use behavioral and organizational insights to design
more specific technical innovations.
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The former more appreciative approach does more to recognize the

inherent complexities of practice, the need for the new to
intermingle with the old, the intellectual and linguistic as well as
technical bases through which change is produced and the ways
in which new conceptions and ideas have diffused into practice from
other areas of organizational research.
I therefore also find myself in sympathy with the calls of Caplan and
others for research to delve into accounting as it is, or at the very
least to start addressing questions of a greater order of complexity
and interdependence. In auditing research, for instance, I think it
could be argued that now would be the appropriate time to broaden
the focus of behavioral research from its current concern with
judgmental issues to address other behavioral and organizational
components of the auditing task. That is not to argue that the
existing work on audit judgment has not achieved a great deal.
Indeed the opposite is the case. But the focus to date nevertheless
has been a partial one. There even is a danger that the exclusivity of
the focus might increase the context to which auditing is perceived
as just a judgmental endeavor.
In practice, however, we know that such cognitive issues are
intermingled with both the ways in which the auditor copes with a
highly structured and time paced context and a task that often calls for
quite complex negotiations and the exercising of considerable
bargaining skills. The cognitive, in other words, is infused with both
the bureaucratic and the political. Caplan calls for a very similar
broadening of focus, perhaps more positively suggesting that auditing
research might probe into "the extent to which auditing firm
personnel practices tend to drive out of the organization the very
individuals...who would be most likely to contribute to solving the
immense problems facing the audit profession today."
Of course gaining access for such research is not going to be
easy.2 For a variety of reasons, providing realistic research settings is
often something of only partial interest to the practitioner
community. But it might well be an area where a careful use of
experimental settings or organizational simulations might provide
suitable contexts in which to investigate at least some of the
possible interactions between different elements of the audit
environment and task and the factors influencing their relative
significance.
Such broadenings of the domain of behavioral and organizational
inquiry are not going to be easy and unproblematic. As Caplan points
out, case studies and presumably similar sites for more complex
2
Even if access is granted to actual audit situations, the research task might still not
be an easy one. Speaking from the perspective of my personal experiences as a
member of an audit committee, even insider status often provides only a very
partial insight into the processes involved in audit verification and particularly the
negotiated final set of attested accounts.
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inquiry require not only new research skills but also "considerable
expertise in identifying appropriate behavioral concepts and
applying these concepts to specific situations." That is a point that
cannot be emphasized sufficiently. Research orientated case studies
can never be atheoretical exercises in mere description and to
assume that they can be is to risk wasting the quite considerable
theoretical sophistication that all the reviewers of the area admit
has developed in recent years.
Whether the task is seen as a descriptive one, the telling of a story
or an indepth explanation of the embedding of accounting in the
contexts in which it operates, it must be recognized that the
resultant analysis is one which emerges through a particular
conceptual lens. There is no such thing as mere description or just
"telling it as it is." Descriptions of necessity appeal to categories,
distinctions and linguistic emphases that provide them with a
specificity and a partiality. However implicitly the process may occur,
accounts of accounting are always based on prior understandings
and emphases. Like Caplan, I think that researchers need to
realize this and, on this basis, to attempt to make such interpretative
frameworks as explicit as is possible, even using them proactively
to trace out particular insights into the functioning of accounting
in practice.
It should not be necessary to reiterate such points, but with all the
current excitement about the possibilities for case research, this
fundamental point is often overlooked. The emphasis can easily be
placed almost exclusively on establishing the legitimacy of the
exercise rather than on its intellectual bases and the contexts it of
necessity creates for an infusion of theories into practice.
Already there are some signs of the dangers that might arise
from such an unproblematic stance. In investigations of the
relationships between cost accounting and new manufacturing
technology, for instance, there are some indications of what could
emerge from such an unreflective perspective. Without care, too
accounting orientated a view is likely not only to focus on the
accounting topics of old irrespective of their significance in the
overall context in which they now operate, but also ignore the ways
in which new technologies can, rather than must, change the very
contexts in which accounting operates. The present accounting
emphasis often fails to locate the accounting changes in the
context of the often quite major shifts occurring in organizational
forms as a response to both technologies and markets. There
seemingly is often a failure to realize the significance of the
ways in which new technologies and market pressures
individually and jointly can provide a focus for changes in modes of
organizational control and thereby the functions attributed to
particular information flows, including that of accounting. As a
result, case study analyses can sometimes seem too partial, too
implicated in the previous accounting order, too readily supportive of
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a
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traditional view of accounting as a relatively isolated and inward

looking technique, and too distanced from the original pragmatic
problems which gave the impetus for current research.
If such perspectives of the past are to be changed, more conceptually
oriented case studies will need to have a much greater appreciation
of the organizational contexts in which accounting operates.
Rather than trying to isolate and contrast the accounting of the
past and that of the future, research needs to probe into the full
range of ways in which technological perturbations can ripple through
organizational domains, disturbing and shifting organizational
practices and perspectives, and creating possibilities for new
alignments of both practices and functionalites, including those of
accounting itself. The likelihood is that such a perspective would
not so readily find a compatibility between the accountings of the
past and those of the new, more likely raising more fundamental
questions about accounting's embodiment in forms of organized
action. At the very least, the interrelationship between the technical
practice of accounting and its organizational context would have to be
addressed quite systematically.
One final issue aired by Caplan is worthy of further comment,
namely his concerns with accounting texts, particularly those in the
management accounting area. I could not agree with him more.
Like him, I also think that this is now a major constraint on
the development of the behavioral and organizational analysis of
accounting and the recognition of its potential. As I see it,
however, the problem is a deeper one than the mere fact that
most texts currently give little or no coverage of behavioral and
organizational issues. The world of the textbook writer is too
frequently that of textbooks. Very few would appear to have much
conception of accounting as it is practiced.
Budgeting is characterized as a technical exercise rather than a
multifaceted organizational phenomena offering numerous opportu-
nities, other than the narrowly technical, for managerial influence.
Similarly, standard setting, investment appraisal, and the mo-
bilization of accounting information around patterns of managerial
responsibility are discussed as technical exercises omitting their
broader behavioral and organizational impact.
Seemingly, having very little understanding of the organizational
nature of accounting as it is practiced, most management accounting
textbook writers also seem to have very little basis on which to
recognize the relevance, as distinct from current acceptability, of
behavioral and organizational insights. Accordingly, I think that they
often find it genuinely difficult to introduce such materials into their
volumes.
The result is a very constraining one for the field of management
accounting itself, however. With their emphasis on purely the
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technical, important though that may be, the texts can only
constitute the equivalent of the bricklaying and plumbing
manuals of the accounting craft. Giving little or no insight into
how the technical elements are mobilized and brought together in
an organizational context, they can never provide a more
managerially orientated design approach to accounting that might
constitute the equivalent of an accounting architecture. That is not
to deny the necessity for the accounting equivalents of the
bricklaying and plumbing crafts. Such technical skills are absolutely
essential. On their own, however, they remain very partial in a world
where accounting intersects with the processes of organizing in
complex and variable ways. Constrained as such skills are, they can
never provide a basis for the evaluation, diagnosis, design and
reform of organizational accounting systems, factors that form an
important part of the managerial as distinct from the technical task.
Indeed, that is why new bases of expertise are arising alongside
accounting in organizational and consultancy settings. New skills
are emergent and behavioral and organizational understandings are
even sometimes informing them. More could be done, however, and
that could be facilitated if the educational texts through which we
attempt to train the accountants of the future could at least start to
reflect some of the understandings of the present rather than only
those of the past.
The continuing isolation of the management accounting textbook
writer from the world of accounting practice makes me pessimistic
of the likelihood of substantial change, at least in the foreseeable
future. The problems in the financial accounting area are no less
severe. In both cases, the narrowly defined technical orientation
represents a major constraint on the wider recognition and potential
of research understandings. With these in mind, I am sure that
this topic is worthy of further consideration by members of the
Accounting, Behavior and Organizations Interest Section.

THE EBBS AND FLOWS OF PROGRESS

Lord's review of the development of behavioral thought in
accounting reinforces many of the findings of the other surveys.
However, its particular approach also results in a number of
observations on the way in which the field has emerged that are
worthy of some further reinforcement.
Interestingly, for instance, quality and originality of research alone
apparently are not sufficient to incorporate specific thrusts of
behavioral and organizational research into the path of cumulative
progress. In this respect, the fact that the early series of
organizationally oriented studies undertaken at Ohio State
University did not generate a continuing momentum is of some
interest. Clearly of great
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originality and recognized as being of high quality, the organizational

orientation was not to result in a sustained school of inquiry at that
time. The reasons for this still remain far from clear.
In contrast, Lord's review usefully gives more consideration to the
comparative scale of the development of psychologically oriented
studies in accounting in the U.S.A., particularly those reflecting a
cognitive and human information processing approach. something
that is more implicit in Birnberg and Shield's view of the intellectual
content of the research literature rather than its numerical distribu-
tion. The reasons for this are no doubt numerous, including not only
cultural predispositions but also the early presence of psychologists
within the American business school community, the accelerating
pace of change in that discipline, the degree to which it is
perceived as a science, and the circumscribed nature of its
methodologies. Lord also usefully emphasizes the way in which such
behavioral accounting research emerged in the context of the more
general rise of interest in the decision making roles of accounting,
thereby illustrating how behavioral accounting research's
development has intermingled with, rather than being completely
isolated from, conceptions of decision rationality that at least have
some compatibility with those underlying economic theorizing.
Seemingly, it was such shifts in the intellectual terrain of accounting
itself that provided a significant context in which behavioral inquiry
could develop rather than the earlier work of Argyris, Simon and
others.

Not least in significance for the behavioral accounting research

community are Lord's observations on the significant roles played
by the institutional structures of the accounting academic world.
He emphasizes the importance for the development of human
information processing research of its early acceptance by the
Journal of Accounting Research (whilst Burgstahler and Sundem
comment on the apparent more recent decline of such interest)
and its incorporation into the highly visible and influential Chicago
empirical research conferences. Both he and Birnberg and Shields
comment on the intellectual significance of key conferences for the
wider development of the area, pointing not only to those organized
at Chicago but also to the early Ohio State conferences and the
later ones organized in conjunction with Accounting,
Organizations and Society. Interestingly in the present context,
Lord also stresses the important role which access to journals has
played in both the emergence and the subsequent shaping of the
field.
Although it is tempting only to emphasize intellectual trends,
achievements and difficulties, Lord's review suggests that much
more is at stake in the emergence of new bodies of knowledge.
That in itself is a useful and humbling thought.
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CONCLUSION
If it is true that Becker originated the term "behavioral
accounting" in 1967, the birth of a new specialist journal is
indeed a fitting occasion on which to celebrate its 21st birthday. *
In the intervening years, progress has been real, possibly more than
many realize. That, however, is no reason for complacency.
Difficulties and problems, as well as challenges, remain, many of
very real significance. In facing the future, researchers in the
area need to continue to learn from the experiences of the past,
improve upon them and carry on conceiving of new possibilities
for enriching our appreciation of the ways in which accounting
functions in a behavioral and organizational context.
In doing so, perhaps some greater recognition of the very
progress that has been achieved makes now an appropriate time
also to reflect on how the field of study is perceived from without.
The Burgstahler and Sundem review illustrates that there are many
nonbehavioral researchers who still have quite a profound
uncertainty about the area.
In part, this is justifiably based on specifit worries and concerns
with particular methodologies, conceptual formulations and studies.
One also senses that the worries go deeper than this. Often it seems
as if the area itself gives rise to a frustration, if not an anxiety.
The reasons for this remain far from clear. There are those who
might be tempted to see the problem in psychological terms, possibly
pointing to a prevailing intolerance of ambiguity and diversity in the
accounting academic community, but that fails to acknowledge
what is ambiguous and what is not. A fascination with, and
therefore a prioritization of, the technical might also be relevant at
this level.
I, however, am more inclined to put the emphasis in part, at
least, not only on the significant contextual factors which sustain
and reinforce concerns with the economic but also on an
intellectual orientation that seemingly wants to delimit and restrict
the problems with which the research agenda can grapple.
Somehow it really does seem that many academic accountants
have great difficulty positioning themselves within the broader
community of the human sciences rather than being only the
guardians of a specific technique. That in itself is revealing,
however. If it were to be the case, it might well suggest that one
problem with behavioral and organizational research in accounting
is that it is possibly quite correctly seen as being capable of providing
a basis on which not only to question accounting but also to do so
in a way that starts to shift the autonomy of accounting
technique, making it a less independent phenomenon. And that
could be very threatening to many.

*Editor's note #3: The volume went to press in 1988.

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Clearly, behavioral research is not the only form of intellectual

endeavor that can do this. Accounting research undertaken within the
context of an efficient capital markets tradition of inquiry also has that
very same potential. Interestingly, however, I sense that that
potential was never realized. Accounting remained accounting.
Behavioral and organizational research, on the other hand, is
already providing a means to see accounting in much more
interdependent terms. Whilst there are those who would celebrate the
broadened agenda of concern, equally there are those who are more
profoundly troubled about where this will take them, seemingly being
extremely reluctant to make the technical core of accounting into
one that takes on a socio-technical form.
Behavioral and organizational researchers in accounting cannot
hope to take on board such a vast evaluative agenda. In any event, the
problems of others are best left to themselves. Increasingly, however.
I think that the behavioral accounting research community ought to
recognize quite explicitly the nature of some of the broader
perspectives from which they might be perceived. While striving to
improve their own research stance, I also think that behavioral
accountants increasingly need to adopt a less apologetic and
referential stance. More confidently articulating the positivity of
their intellectual position, they can both point to and play a role
in developing its substantive grounding in the wider domain of the
human sciences.
As behavioral and organizational research moves forward into its
years of majority, I, at least, would hope that it not only continues to
refine the skills and perspectives developed in its earlier years, but
also, in the process, adopts a more mature and self-confident
intellectual stance. To me, both are possible and both are
desirable.