AES Summer School 2025

Welcome to the 2025 AES summer school main page. Each year, the AES sponsors a summer school open to students and faculty. The summer school is intended to develop intellectual curiosity in topics of current interests as well as offer introductions to methods and questions.  A flyer can be downloaded here.

This year, the summer school will be hosted by Baruch College on Aug. 6th and 7th , 2025. Please find this page a registration link and tentative schedule:

Registration Link
If you are attending the annual Congress, you must register separately for the summer school, as these are separate events. Once you receive a Paypal payment confirmation, you will be registered at the summer school.

Additional documents will be shared directly on this page so please bookmark for future reference.

Logistics and Link

For any question, please email Cathi at admin@accountingtheory.org or any of the organizers.  The sessions will be run in-person at Baruch College on Aug. 6-7th, 2025.  This year's speakers at the summer school include Jeremy Bertomeu (Washington University), Jon Glover (Columbia), and Ivan Marinovic (Stanford).

If you are a student or faculty at Baruch College, you do not need to pay a registration fee. However, please email the address below for us to keep a count of all attendees.

If attending in person, you must be registered and have ID, as the entry into the Baruch building is controlled. Please walk to the security booth and present your ID and they will have a list "AES summer school 2025."

Remote Option

For those who cannot travel, we will offer a remote Zoom connection, but this may not be ideal and should be used only as a back-up solution, since the sessions are not designed to be delivered as hybrid courses.  To attend remotely, you will need a password that will be included in the registration packet. The link will be sent by August 1st. If you are registered but have not received the link by August 2nd, please email us. The registration is not refundable if you attend online.

Program: Aug. 6th - Aug. 7th
All times in EST

Location: Baruch College
Stan Ross Department of Accountancy, 12th floor
137 E 25th St, New York, NY 10010
137 E 25th St, New York, NY 1001

Wednesday, August 6th

8:55 am - 9:00 am Opening Words and Welcome, Jeremy Bertomeu

9:00 am – 10:30 am Why Structural Estimation? Basic tools. Ivan Marinovic

This first session will present the basic premises and objectives of structural estimation, the differences between theory, structural estimation, and reduced-form, as well as the primary computational and econometric tools commonly-used and portable across applications.

Recommended readings:
A Primer on Structural Estimation in Accounting Research, J. Bertomeu, Y. Liang, and I. Marinovic, Foundations and Trends in Accounting, 2023
Dynamic Models and Structural Estimation in Corporate Finance, I. Strebulaev, and T. Whited, Foundations and Trends in Finance 2011
A Critique of Recent Quantitative and Deep-Structure Modeling in Capital Structure Research and Beyond, I. Welch,  Critical Finance Review 2013

10:45 am - 12:15 am Structural Estimation: Disclosure Applications. Ivan Marinovic

We will illustrate a first set of applications of structural estimation in the context of dynamic voluntary disclosure. These models seek to infer from observed disclosures and assumptions of strategic behavior along the lines of Verrecchia (1983) and Dye (1985), how much information is being strategically withheld. 

Recommended readings:
The Dynamics of Concealment, J. Bertomeu, I. Marinovic, S. Terry, and F. Varas, Journal of Financial Economics 2022
A Simple Structural Estimator of Disclosure Costs, E. Cheynel and M. Liu-Watts, Review of Accounting Studies 2020
From Casual to Causal Inference in Accounting Research: The Need for Theoretical Foundations, Foundations and Trends in Accounting 2016

12:15 am - 1:45 pm Lunch break

2:00 pm - 3:00 pm Structural Estimation: Agency Applications. Ivan Marinovic

In this session, we will discuss recent applications of structural estimation in the context of agency theory, initially pioneered by Mary Margiotta and Bob Miller, and later expanded by George Levi-Gayle, Limor Golan, and Chen Li. These models allow the researcher to estimate the underlying assumptions, e.g., outside option, cost of effort, and effect of effort on performance, that rationalize an existing contract.

Recommended readings:
Has moral hazard become a more important factor in managerial compensation?, G. Gayle and R. Miller, American Economic Review 2009
Was Sarbanes–Oxley costly? Evidence from optimal contracting on CEO compensation, G. Gayle, C. Li, and R. Miller, Journal of Accounting Research 2022
Explaining the Compensation of Superstar CEOs, J. Bertomeu, I. Marinovic, and M. Milone WP 2024

3:15 pm - 4:30 pm Hands-On session: My first dynamic programming model. Ivan Marinovic and Jeremy Bertomeu

In this session, you will program your first  dynamic problem and use your program to recover the "primitives" of a simulated dataset, understanding the process of estimation, identication, and how to verify that the code operates as intended. We strongly recommend Matlab as we will use Matlab code during this session.  

4:45 pm - 6:00 pm Writing Theory-Based Empirical Research: Beyond Structural and Open Questions. Jeremy Bertomeu

We discuss in this section the general constraints and trade-offs of using structural estimation, what problems structural estimation solves or does not solve, and how it interfaces with reduced-form. Then, we broaden the discussion to show that structural estimation is neither necessary nor sufficient for 'theory-based' estimation, and discuss more general principles that also apply to theory-based reduced-form approaches.

6:00 pm Dinner

Thursday, August 7th

9:00 am – 10:30 am Explicit Contracts. Jon Glover

This session will provide a brief introduction to traditional contract theory, which studies the role of explicit contracts that are enforced by the courts. We will start with single-period principal-agent models of adverse selection and moral hazard before extending the models to include multiple tasks, multiple periods, and multiple agents. In our discussion of multi-period models, we will cover models of earnings management and accounting conservatism.

Recommended readings:
Earnings Management and the Revelation Principle, A. Arya, J. Glover, and S. Sunder, Review of Accounting Studies 1998
Optimal Conservatism with Earnings Manipulation, J. Bertomeu, M. Darrough, and W. Xue, Contemporary Accounting Research 2017
Accounting Conservatism and Incentives: Intertemporal Considerations, J. Glover and H. Lin, Accounting Review 2018

10:45 am - 12:15 am Relational Contracts. Jon Glover

This session will cover relational contacts, which are based on non-verifiable performance measures so cannot be enforced by the courts. Instead, relational contracts typically rely on repeated play to make promises self-enforcing. This difference in the enforcement mechanism leads to qualitatively different empirical predictions. We will study relational contracts between the principal and one or more agents, as well as relational contracts between agents. The applications covered will include performance measure design (e.g., individual vs. joint performance measures, incorporating both verifiable and non-verifiable performance measures in bonus pools, and accounting conservatism) and team design (e.g., functional vs. cross-functional teams, demographic diversity, and productive diversity). If time permits, we will also cover recent applications of these ideas in research on corporate governance and executive compensation.

Recommended readings:
Optimal Contracting wth Subjective Evaluation, B. MacLeod, American Economic Review 2003
Team Incentives and Bonus Floors in Relational Contracts, J. Glover, and H. Xue, Accounting Review 2020
Optimal Team Composition: Diversity to Foster Implicit Team Incentives, J. Glover and E. Kim,  Management Science 2021
Accounting Conservatism and Relational Contracting, J. Glover and H. Xue, Journal of Accounting and Economics 2023

12:15 am - 1:45 pm Lunch break

2:00 pm - 3:00 pm Hands-On session: Solving Agency problems. Jeremy Bertomeu and Jon Glover

This session is designed for students who have less experience in writing and solving their own model. The objective of the session will be to solve a practical exercise, as would be the case when writing theory, emphasizing the process of solving the model. We will review basic mathematics and discuss how tools such as Mathematica or well-designed AI prompts can help reduce errors and solve more complex models.

3:15 pm - 4:45 pm Writing Theory, Writing Models: How to Start and What to Look for. Jeremy Bertomeu and Jon Glover

4:45pm – 5:00pm Closing Remarks