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This study applies a model of systematic belief revision to examine the effect of the relation between current‐period unexpected earnings and prior‐period security returns on the current period relation between those unexpected earnings and returns. Cross‐sectional analysis blurs the effects of past information on current returns in a manner that makes it easy to overlook any dependence on historical patterns in this information. We show that the market responds to earnings innovations conditional on these patterns but does not respond in the manner predicted by the Hogarth and Einhorn (1992) belief adjustment model. Nonetheless, the results suggest that individual decision processes are detectable in capital markets data.

This paper aims to examine the impact of the Sarbanes–Oxley Act of 2002 (SOX) on the academic business ethics literature with the intent of making this research more accessible to those researchers and practitioners working in business ethics and other related fields. Specifically, the authors outline the types and scope of SOX-related research, examine the extent of reliance on SOX, identify which theoretical frameworks and research approaches are used and point out under-researched areas.

Using a descriptive approach, the authors examine the theoretical perspectives, classifying these perspectives into four groupings (economics, ethics/moral, psychological and sociological). Using counts, categorization and content analyses, the authors provide an overview of 115 articles with further analysis provided for articles relying heavily (n = 14) or moderately (n = 42) on SOX.

Whistleblowing and codes of ethics are well-researched topics. However, employment of some theories (e.g. signaling theory and stakeholder theory) and qualitative approaches are used less often. Other under-researched issues in the sample include CEO/CFO certifications, cost of compliance, auditor disclosures and empirical investigation of SOX and auditor independence (or corporate culture).

The authors’ decision to use certain databases, search terms and research methods, and to focus on business ethics journals and English language articles are possible limitations.

The authors’ contributions comprise an examination of the scope of SOX topics and detailing how reliant the research is on SOX. The authors identify trends in this literature and provide evidence of the broad theoretical frameworks to better understand the breadth and depth of theories used.