عنوان مقاله [English]
Earning management is influenced with environmental factors that can be theoretically analyzed by agency theory. From a legal perspective, agency dilemma represented with principal – agent problem. It can be in common ground with accounting. This problem causes to the moral hazard that can be raised in the form of information asymmetry via the relationship between manager and shareholders. Property rights protection is a manner to control the moral hazard. The purpose of this study is to examine the legal variables effect on earning management in Tehran Stock Exchange listed companies by utilizing the concepts of institutional economics, property rights institution and principal – agent problem. Therefore, the relationship between property right index and its components with earnings management was investigated. For this purpose, the information of 94 companies was evaluated from 2011 to 2017 with GMM method. According to the results, protection of property rights is significantly reduce earnings management. Furthermore reinforcement of rule of law, political stability, corruption control, access to loan, intellectual property rights protection, patent protection and facilitating property registration process will control the earning management.