Margin of safety: Life history strategies and the effects of socioeconomic status on self-selection into accounting

Justin Leiby, Paul E. Madsen

Research output: Contribution to journalArticlepeer-review


We use experimental and archival evidence to show that people who had low socioeconomic status (SES) as children participate in the U.S. accounting labor market in distinctive and consequential ways. Drawing on life history theory, we predict and show that low SES individuals select into accounting at disproportionately high rates relative to other fields, an effect driven by accounting's relatively high job security. Supplemental tests are consistent with these low SES individuals being a source of high quality human capital for the accounting profession, as low SES individuals selecting into accounting possess desirable attributes at relatively high rates. From a social perspective, we provide theory and evidence consistent with accounting being an important and secure source of upward social mobility in comparison to other fields. However, recessions cause selection into accounting by low SES individuals to decrease at a higher rate than in other fields, compromising these professional and social benefits. For example, our evidence is consistent with the “low SES effect” improving gender diversity among entrants into the accounting labor market during good economic times. However, lower self-selection rates during recessions are particularly pronounced among low SES females, who may thus bear the brunt of lost professional and social benefits.

Original languageEnglish (US)
Pages (from-to)21-36
Number of pages16
JournalAccounting, Organizations and Society
StatePublished - Jul 2017
Externally publishedYes


  • Accounting human capital
  • Gender diversity
  • Inequality
  • Life history theory
  • Self-selection
  • Socioeconomic status

ASJC Scopus subject areas

  • Accounting
  • Sociology and Political Science
  • Organizational Behavior and Human Resource Management
  • Information Systems and Management


Dive into the research topics of 'Margin of safety: Life history strategies and the effects of socioeconomic status on self-selection into accounting'. Together they form a unique fingerprint.

Cite this