November 06, 2017 10:49 PM

Are there too many PhDs?

Posted by John Flower

By John Flower

In the last issue of the EAA Newsletter, Willem Buijink argued that European universities produce too few PhDs in accounting and that the EAA should seek to change this situation.[1] In this note I argue the exact opposite – that, at present, European universities are producing far too many PhDs in accounting and that it would be foolish and a waste of resources to seek to increase this already excessive number. I base my argument on my personal experience, both in my early years as a teacher of accounting and later as a professor.

I entered the academic accounting profession more than fifty years ago, when in 1963 I was appointed lecturer in accounting at the London School of Economics (LSE). At that time my sole academic qualification was a bachelor degree in accounting and economics gained at the LSE some five years previously. In the interim, I had completed my professional qualification as member of the ICAEW (Institute of Chartered Accountants in England and Wales), which involved three years working in a professional accountant’s office.[2] In addition, I had spent two years gaining knowledge and experience of computing, firstly at Columbia University, New York, and later with IBM.[3] With respect to my qualifications, I was typical of British university accounting teachers in the 1960s. Robert Parker lists the twenty-one Professors of Accounting at British universities at the end of the 1960s.[4] Only three had doctorates (and one of those was in Economic History), yet all except one had a professional accounting qualification.[5]

My fellow lecturers in accounting at LSE had similar qualifications: Peter Bird (first degree and ICAEW), Bryan Carsberg (no first degree – he gained an MSc whilst working as a lecturer – and ICAEW) and Mike Bromwich (first degree and CIMA – Chartered Institute of Management Accountants).

I make two observations about these features of academic accounting in the 1960s. My first observation is that the lack of a doctoral qualification was in no way a hindrance to these academics producing teaching and research of the highest quality, as exemplified by the exploits of my fellow lecturers at the LSE. Bryan Carsberg’s output of significant books and articles was prodigious. Mike Bromwich went on to write the definitive monograph of the relationship of accounting and economic theory (Financial Reporting, Information and Capital Markets). Peter Bird wrote the first serious analysis of accountability[6] (up to then a neglected topic) before his contribution was cut off by his untimely early death. My own contribution, always much more modest, was limited by my leaving academia to join the staff of the European Commission in 1974. I would judge the contribution of these young academics to the development of the academic subject of accounting was immense, despite the fact that none had the benefit of a PhD. In fact I would argue the exact opposite: none suffered from the disadvantage that he had to spend three of four of his most formative years toiling away on a PhD!

My second observation is that, as virtually all university accounting teachers were professionally qualified (acquired after a minimum of three years practical experience), their teaching and research were founded on the practical realities of the work of an accountant. It is surely significant that two of my fellow lecturers developed significant relationships with the ‘real world’ outside the university: Bryan Carsberg became Secretary-General of the IASC, and Mike Bromwich President of the Chartered Institute of Management Accountants.

My scepticism as to the value of a PhD has been reinforced by my experience as an examiner. Although I am not myself a PhD, I have acted as the examiner of a PhD candidate on at least twenty occasions. Based on my experience as an examiner, I came to two general conclusions.

My first conclusion was that, with very few exceptions, the value of the research undertaken by the candidate was very limited. Although the research always satisfied the conditions for the award of the degree, the research results were often trivial and rarely of interest to people outside academia. Although I ceased to act as an examiner many decades ago, I feel that this conclusion is still valid. I base this conclusion on two sources of evidence: firstly, my analysis of the papers presented at the 2017 EAA Annual Congress and, secondly, the content of academic accounting journals.

The 2017 EAA Annual Congress: At this congress, there were over nine hundred papers presented at the Congress’s parallel sessions. Most were written by young researchers and presented the results of their research connected with a PhD – either work in progress or the finished thesis. I attended three sessions covering seven papers. So my sample is far too small to serve as a basis for scientific findings. But I argue that it provides a sufficient basis for the following propositions regarding current PhD research:     

  1. Most of the research in the papers presented at the parallel sessions that I attended consisted of the researcher analysing data (generally using sophisticated software). Invariably the data was publicly available. The researcher did not generate it him/herself, for example by going out into the ‘real world’ to observe and interview people. The research could have been (and probably was) completed without the researcher leaving the university. According to Salvador Carmona, over half of the papers published in the EAA’s journals are based on publicly available databases.[7]
  2. The amount of relevant data that is publicly available is rather limited. The outcome is that it tends to be exploited ever more intensively by academic researchers. An example is the comment letters on proposed standards, which are published on the standard-setters’ web-sites. They have been the focus of innumerable research projects. The attention given to them is quite out of proportion to their importance in the standard setting process, the greater part of which takes place out of the public gaze. In order to find out how the standard-setting process actually functions, the researcher would have to leave his/her ivory tower and observe the ‘real world’. It would seem that the principal criterion for selection of research topics is the availability of data and not the relevance and importance of the topic.
  3. One consequence of the use of readily available data sources is that much current research concentrates on trivial aspects of the data – it subjects minor data items to extraordinarily detailed analysis. For example, one paper consisted of an econometric analysis of footnotes in a form submitted to the SEC.

I submit that this analysis provides some justification for my claim that much of recent PhD research deals with trivial matters, that the principal criterion used in selecting a research topic is the easy availability of data (and not the relevance of the issue) and that much research is carried out without the researcher leaving the university’s ‘ivory tower’.

The contents of academic accounting journals. Much of the content of these journals is made up of summaries of PhD theses. In fact, I suspect that a major factor in the explosive growth in the number of academic accounting journals over the last thirty years has been to provide an outlet for the work of young researchers who are responding to the imperative of ‘publish or perish’.[8] In my opinion, too much of the current research output of accounting academics concentrates on technical issues of little interest to anyone other than fellow academics. The late Anthony Hopwood characterised the state of accounting research as an increasing autonomous one with the primary conversations being internal to the community… almost the only consumers of accounting research are fellow accounting researchers.[9] Accounting research seems to be excessively concerned with its own narrowly defined field, with accounting academics devoting their energies to analysing and criticising the work of other accounting academics, rather like a dog chasing its own tail.

A fundamental task of the university is to serve the whole of society by subjecting current practice to searching criticism and by developing novel practices that better serve society’s needs. The great challenges that mankind currently faces are almost completely ignored by most contemporary accounting researchers. I would characterise their behaviour as ‘rearranging the deck-chairs on the Titanic.’ Whilst mankind is confronted with existential threats,[10] they busy themselves with issues that, in comparison, are ridiculously trivial and are irrelevant to the real problems. I feel that a major cause of this regrettable situation is that most current academics lack the lack of practical experience that their forebears had fifty years ago. 

My second conclusion was that most PhD candidates had spent many years (generally three or four years) on an activity that I characterised as a waste of time, in fact a scandalous misuse of that most valuable resource – a young person’s time. I contrast the way that I spent the five years between completing my bachelor degree and entering academia: in gaining practical on-the-job experience in an accountant’s office and learning computing. I feel that this was far more productive compared to how current PhD candidates spend their time – in the library poring over journals and at the computer terminal analysing the output of a data-mining programme.

There is an obvious reason why young people who are intent on pursuing an academic career in accounting, find it necessary to have a PhD – almost all European universities insist on this qualification for an academic appointment. I find this requirement utterly perverse. I consider it to be a manifestation of a phenomenon which I characterise as ‘physics-envy’. Certain senior accounting academics (who, on account of their prestige, set the tone for the academic  accounting profession as a whole) are impressed by the progress that the discipline of physics has made over the last three hundred years in understanding and explaining the natural world. On account of this success, departments of physics within most European universities enjoy enormous prestige – much greater than departments of accounting, which are often regarded as (to quote Henry Rand Hatfield) ‘a pariah whose very presence detracts somewhat from the sanctity of the academic halls’.[11] In simple terms, the professors of accounting envy the superior social and academic status of the professors of physics. They feel that they can only hope to aspire to the same status, if accounting can become more like physics. They note that academic staff in physics departments all possess a PhD and therefore insist on the same qualification for their own staff.

These heads of university accounting departments make a serious error. The academic discipline of accounting is fundamentally different from that of physics. The difference is analysed in a very convincing fashion by the late Eddie Stamp[12] in a paper with the helpful title ‘Why can accounting not become a science like physics?’[13] The basic subject of study in accounting is people: accounting is a social science;[14] the basic subject of physics is the natural world (atoms, light, heat and so on). The natural world can be studied very well in the university using the latest modern technology such as particle accelerators, and this is in fact what most PhD students in physics do. People can be studied only very imperfectly within the confines of the university. The university makes up only a tiny fraction (and a very unrepresentative fraction) of mankind. In order to study how people behave in the many different social situations, the researcher must leave her ivory tower and enter the ‘real world’.

A principal task of university departments of accounting is to prepare their students to act as accountants in the ‘real world’. It is unacceptable that the many of the staff of these departments have little experience of this world and that their preparation for the important and responsible task of forming the next generation of accountants took place exclusively within the university’s ‘ivory tower’ - hence my plea for fewer, rather than more, PhDs in accounting.    

[1] Willem Buijink, ‘Towards a higher doctorate propensity in accountancy in Europe? The role of the EAA’. EAA Newsletter issue 58, July 2017.

[2] In fact, I spent little time in the office of the professional accountant. I spent most of my time on the premises of a number of small businesses for which I prepared and then audited the accounts – a combination that would be quite illegal today! The businesses covered a remarkably wide range of sectors: manufacturing, transport, wholesaling, retailing and many services, such as printers and estate agents.

[3] At that time, it was not possible to study computing at a British university – hence the need to resort to an American university and IBM.

[4] R.H.Parker, ‘Flickering at the margins of existence. University teachers of accounting, 1960-1971’, British Accounting Review, 1997, volume 29, special issue, Table 3.

[5] The exception was J. Perrin who had a London PhD, probably the first doctorate in accounting from the LSE.

[6] Peter Bird, Accountability: Standards in Financial Reporting, 1973, London, Haymarket.

[7] Salvador Carmona was referring to a publicly available analysis. I regret that I cannot recall the precise reference.

[8] When I joined the LSE in 1963, there was only one serious academic accounting journal in the English-speaking world (The Accounting Review) plus a few professional journals which published academic articles, such as Accountancy.

[9] Anthony Hopwood, ‘Whither accounting research?’. The Accounting Review, 2007, 82(5), pp. 1370-1

[10] I have analysed these threats in two recent books ‘Accounting and Distributive Justice’ and ‘The Social Function of Accounts’. 

[11] Henry Rand Hatfield, ‘An historical defence of book-keeping’ reprinted in Baxter, W.T and Davidson, S. Studies in Accounting Theory, 1962, London, Sweet & Maxwell.

[12] Eddie Stamp was one of the most influential accounting academics working in the UK in the second half of the last century. He was a Canadian Chartered Accountant and had a degree in natural science from Cambridge University, but no PhD.

[13] Abacus, Vol. 17, No. 1, 1981

[14] I believe that this claim is not controversial. To people who dispute my claim, I suggest that they read Eddie Stamp’s article, where he argues the case far more eloquently than I can.


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About John Flower

University of Bristol (Emeritus)
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