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Madhav V. Rajan

Madhav V. Rajan
Professor, Accounting
MadhavV.Rajan
The Robert K. Jaedicke Professor of Accounting
Senior Associate Dean for Academic Affairs
Professor of Law (by courtesy), Stanford Law School
Academic Area: 
Accounting

Research Statement

Madhav Rajan specializes in the economics-based analysis of management accounting issues. He has carried out analytical, empirical, and field-based research on the role of incentives in supply chain contracting, the use of nonfinancial performance measures, and the value of accounting in modern manufacturing environments. His theoretical work has examined the optimal choice of information and incentive systems and the rationale behind observed internal accounting practices related to cost allocation and capital budgeting. Madhav’s most recent work focuses on the internal control of multi-divisional firms. Topics include the efficiency of auction markets at allocating resources across divisions and the usefulness of bonus pools as a means for incorporating subjective measures of managerial performance. He is also involved in several projects on the fundamental question of how accounting measures of performance can be used to infer the economic profitability of firms.

Bio

Madhav Rajan is Senior Associate Dean for Academic Affairs at the Graduate School of Business, and oversees the MBA and MSx programs. He is the Robert K. Jaedicke Professor of Accounting at the business school and also Professor of Law (by courtesy) at Stanford Law School. Madhav joined Stanford University in 2001. From 2002 to 2010, he served as the area coordinator for Accounting at Stanford GSB.

Madhav received his undergraduate degree in Commerce from the University of Madras, India, and his MS in Accounting, MBA, and PhD degrees from the Graduate School of Industrial Administration at Carnegie Mellon University. In 1990, his dissertation won the Alexander Henderson Award for Excellence in Economic Theory. After completing his doctoral studies, Madhav joined the faculty of the Wharton School of the University of Pennsylvania and was promoted to the rank of tenured Associate Professor in 1996, and Professor in 2000.

Madhav’s primary area of research interest is the economics-based analysis of management accounting issues, especially as they relate to the choice of internal control and performance systems in firms. In 2004, he received the Notable Contribution to Management Accounting Literature award for his work with Stan Baiman on “The Role of Information and Opportunism in the Choice of Buyer-Supplier Relationships.” Madhav has twice served as editor of The Accounting Review. He has also served as Departmental Editor for Accounting at Management Science, and as Associate Editor for both the Accounting and Operations areas. He is a member of the Management Accounting section of the American Accounting Association and has twice been a plenary speaker at the AAA Management Accounting Conference.

Madhav has taught courses in accounting at the undergraduate, MBA, and executive MBA levels. He has also taught an elective class in financial reporting at Stanford Law School. Madhav has won teaching honors at Wharton and Stanford, including the David W. Hauck Award, the highest undergraduate teaching award at Wharton. At Stanford, Madhav participates in a variety of executive education initiatives, including teaching in the flagship Stanford Executive Program and co-directing Finance and Accounting for the Nonfinancial Executive. He has made invited presentations to the Labor Seminar of the National Football League Management Council and taught in the National Basketball Players Association Program.

Madhav is coauthor of Cost Accounting: A Managerial Emphasis, whose 15th edition was published by Pearson Prentice Hall in January 2014. He is also coauthor of Managerial Accounting, whose first edition was published by Pearson in January 2013. Madhav is a Director of Cavium, Inc. and iShares, Inc. and a Trustee of the iShares Trust.

Academic Degrees

  • PhD, Carnegie Mellon University, 1990
  • MBA, Carnegie Mellon University, 1989
  • MS in Accounting, Carnegie Mellon University, 1987
  • BCom, University of Madras, India, 1984

Academic Appointments

  • At Stanford University since 2001
  • Senior Associate Dean for Academic Affairs, Stanford GSB, 2010-present
  • Area Coordinator for Accounting, Stanford GSB, 2002-2010
  • Visiting Professor, University of Chicago Booth School of Business, Winter 2007-08
  • Associate Professor, Wharton School of the University of Pennsylvania, 1996-2000
  • Assistant Professor, Wharton School of the University of Pennsylvania, 1990-1996

Awards and Honors

  • Notable Contribution to Management Accounting Literature Award, 2004
  • David W. Hauck Award for Outstanding Teaching, 2000
  • Alexander Henderson Award for Excellence in Economic Theory, 1990

Publications

Journal Articles

Madhav V. Rajan, Maureen McNichols, Stefan J. Reichelstein. Review of Accounting Studies. February 4, 2014.
Madhav V. Rajan, Venkatesh Nagar, Feng Li, Michael Minnis. Journal of Accounting and Economics. 2014.
Madhav V. Rajan, Stefan J. Reichelstein, Alexander Nezlobin. Management Science. January 26, 2012, Vol. 58, Issue 5, Pages 980-995.
Merle Ederhof, Madhav V. Rajan, Stefan J. Reichelstein. Foundations and Trends in Accounting. 2011, Vol. 5, Issue 4, Pages 243-316.
Venky Nagar, Madhav V. Rajan, Richard Saouma. Journal of Accounting Research. September 2009, Vol. 47, Issue 4, Pages 991–1025.
Madhav V. Rajan, Stefan J. Reichelstein. Journal of Accounting Research. June 2009, Vol. 47, Issue 3, Pages 823–865.
Madhav V. Rajan, Stefan J. Reichelstein. The Accounting Review. 2009, Vol. 84, Issue 1, Pages 209-237.

Books

Charles T. Horngren, Srikant M. Datar, Madhav V. Rajan Upper Saddle River: Pearson Prentice Hall, 2014.
Srikant Datar, Madhav V. Rajan Upper Saddle River: Pearson Prentice Hall, 2013.

Working Papers

An Evolutionary Risk Basis for the Differential Treatment of Gains and Losses
Madhav V. Rajan, Venkatesh Nagar, Korok Ray, May 2014
Capital Investments and Financial Ratios | PDF
Madhav V. Rajan, Stefan J. Reichelstein, Alexander Nezlobin, April 2014
Stability Properties of the Rate-of-Return Regulation Process | PDF
Madhav V. Rajan, Stefan J. Reichelstein, Alexander Nezlobin2010

Courses Taught

Degree Courses

2013-14

Managerial accounting refers to the preparation and use of information for internal planning, control, coordination, and performance evaluation purposes. This orientation contrasts with financial accounting where the focus is on accounting...

GSB students are eligible to report on work experience that is relevant to their core studies under the direction of the Senior Associate Dean responsible for the MBA Program. Registration for this work must be approved by the Director of the...

2012-13

Managerial accounting refers to the preparation and use of information for internal planning, control, coordination, and performance evaluation purposes. This orientation contrasts with financial accounting where the focus is on accounting...

GSB students are eligible to report on work experience that is relevant to their core studies under the direction of the Senior Associate Dean responsible for the MBA Program. Registration for this work must be approved by the Director of the...

2011-12

This course provides a comprehensive introduction to the concepts and tools of managerial accounting. The first part of the course demonstrates how management can rely on internal accounting information to measure and manage the profitability of...

GSB students are eligible to report on work experience that is relevant to their core studies under the direction of the Senior Associate Dean responsible for the MBA Program. Registration for this work must be approved by the Director of the...

2010-11

This course provides a comprehensive introduction to the concepts and tools of managerial accounting. The first part of the course demonstrates how management can rely on internal accounting information to measure and manage the profitability of...

GSB students are eligible to report on work experience that is relevant to their core studies under the direction of the Senior Associate Dean responsible for the MBA Program. Registration for this work must be approved by the Director of the...

Stanford Case Studies

Service to the Profession

  • Editor, The Accounting Review
  • Assoc. Editor, Management Science (Accounting and Operations); Journal of Accounting, Auditing, and Finance
  • Editorial Board, Review of Accounting Studies