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Ronald Dye

Leonard Spacek Professor of Accounting Information & Management at Kellogg School of Management

Schools

  • Kellogg School of Management

Links

Biography

Kellogg School of Management

A faculty member at the Kellogg School of Management since 1986, Ronald Dye was named the Leonard Spacek Professor of Accounting Information and Management in 1993. Previously, he held appointments in accounting and economics at the University of Chicago and in accounting at Yale University.

Professor Dye's teaching and research interests include managerial accounting, management compensation, financial disclosure, information economics, and the economics of standards. He is the author of more than 40 papers which have appeared in leading academic journals of accounting and economics, including The Accounting Review, Journal of Accounting Research, Journal of Accounting and Economics, Rand Journal of Economics, International Economic Review, Journal of Labor Economics, Journal of Public Economics, Journal of Business,_ and the Journal of Political Economy. He is a member of the editorial boards of the Journal of Accounting Research, Journal of Accounting and Economics, and the _Review of Accounting Studies.

Professor Dye regularly gives seminars at leading international business schools. Most recently, he has been studying and lecturing on how firms' can improve their strategic decision-making through their accounting choices.

Research Interests

Managerial accounting, management compensation, financial disclosure, information economics, economics of standards, auditors

Education

  • PhD, 1980, Economics, Carnegie Mellon University
  • MS, 1978, Economics, Carnegie Mellon University
  • BS, 1976, Mathematics, State University of New York, Cortland

Academic Positions

  • Chairman of Department of Accounting and Information Management, Kellogg School of Management, Northwestern University, 2001-present
  • Leonard Spacek Professor of Accounting, Kellogg School of Management, Northwestern University, 1993-present
  • Visiting Professor of Accounting, Marshall School of Business, University of Southern California, 2006-2006
  • Visiting Goizueta Professor of Financial Reporting, Goizueta Business School, Emory University, 2000-2000
  • Visiting Professor of Accounting, School of Management, Yale University, 1997-1997
  • Chairman of Department of Accounting and Information Management, Kellogg School of Management, Northwestern University, 1993-1999
  • Eric L. Kohler Professor of Accounting, Kellogg School of Management, Northwestern University, 1990-1993
  • Visitng Professor of Accounting, Graduate School of Business, University of Chicago, 1989-1990
  • Professor of Accounting, Kellogg School of Management, Northwestern University, 1988-1989
  • Associate Professor of Accounting, Kellogg School of Management, Northwestern University, 1986-1988
  • Associate Professor of Accounting, Graduate School of Business, University of Chicago, 1985-1986
  • Assistant Professor of Accounting and Business Economics, Graduate School of Business, University of Chicago, 1983-1985
  • Assistant Professor of Business Economics, Graduate School of Business, University of Chicago, 1980-1983

Awards

  • Yuji Ijiri Distinguished Visiting Lecturer at Carnegie Mellon University, Carnegie Mellon University
  • Named John Diclhaut Scholar at the University of Minnesota
  • Best paper in Accounting Horizons in 2015, American Accounting Association, 2016
  • Distinguished Visiting Scholar, UCLA Anderson School of Management, Winter quarter 2016
  • Distinguished Visiting Scholar, Stanford University, November 2014
  • Chairs, Kellogg School of Management, 2001-2002
  • Alexander Henderson Award, Alexander Henderson Institution, 80-80

Editorial Positions

  • Editorial Board, Journal of Accounting, Finance, and Law, 2015-2019
  • Associate Editor, Foundations and Trends in Accounting, 2005-2015
  • Editorial Board, Contemporary Accounting Research, 2004-2016
  • Editorial Board, Review of Accounting Studies, 1996-2018
  • Associate Editor, Journal of Accounting and Economics, 1988-2017
  • Editorial Board, Journal of Accounting Research, 1984-2018
  • Associate Editor, Foundations and Trends in Accounting
  • Editorial Board Member, Japanese Accounting Review

Teaching Interests

Managerial accounting, management compensation, financial disclosure, information economics, economics of standards, auditors

Read about executive education

Cases

Dye, Ronald A. and Swaminathan Sridharan. 2002. Resource Allocation Effects of Price Reactions to Disclosures. Contemporary Accounting Research. 19(3): 385-410.

Capital market participants collectively may possess information about the valuation implications of a firm's change in strategy not known by the management of the firm proposing the change. This paper asks whether a firm's management can exploit the capital market's information in deciding either whether to proceed with a contemplated strategy change or whether to continue with a previously initiated strategy change. In the case of a proposed strategy change, it is shown that managers can extract the capital market's information by announcing the potential new strategy, and then conditioning the decision to implement the new strategy on the size of the market's price reaction to the announcement. Under this arrangement, it is shown that a necessary condition to implement all and only positive net present value changes is that managers proceed to implement some strategies that garner negative price reactions upon their announcement. In the case of deciding whether to continue with a previously implemented strategy change, it is shown that it may be optimal for the firm to predicate its abandonment/continuation decision on the magnitude of the costs it has already incurred. Thus, what looks like "sunk-cost" behavior may in fact be optimal.

Dye, Ronald A.. 1984. The Trouble with Tournaments. Economic Inquiry. 22(1): 147-149.

The recent interest in tournaments, where pay is based on performance relative to one's peers rather than solely on output, results from the observation that the differences in the pay of chief executives and their immediate subordinates seems to be greater than the difference in their abilities or outputs. However useful tournaments may be in explaining the salary differences, it is important to assess the limitations of tournaments and to examine the claimed virtues of tournaments as incentive devices. Four areas are criticized: 1. the implementation of a handicap system to account for differences in innate abilities of workers, 2. the instability arising from the introduction of other compensation schemes, 3. the possibility of collusion among players to reduce their effort levels, and 4. the determination of a tournament winner when outputs are multidimensional (as is usually the case).

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