Individual's Religiosity Enhances Trust: Latin American Evidence for the Puzzle

This paper explores the effect of religious observance and affiliation to the dominant religion (Catholicism) on trust in institutions and toward others, and market attitudes. The analysis is performed using a Latin American database of 20,000 respondents from 2004 by means of ordered probit models. The most interesting results are:

• (i) 

  Trust toward others is positively correlated with both religious observance and Catholic affiliation (and practice ).
• (ii) 

  There is a positive correlation between trust in the government, in the police, in the armed forces, in the judiciary and in the banking system and religious practice in general. Identical positive findings are obtained for Catholic affiliation and practice , although they may be affected by a majority effect.

Moreover, there is no evidence to support the hypotheses of a negative effect of religion on social capital.     

The study of futures, and the analysis of power

This study attempts to find out in which direction global power distribution is shifting. This is expected to shed light on the chances we have to build a democratic, ecologically sustainable and socially just world future society. The paper raises and explores, to some extent, three questions: (1) Who is the emerging global ruling class, and does it develop some sort of class consciousness? (2) What are the means used by the global ruling class in the class struggle? and (3) What are likely consequences for the future of global society?     

The social construction,challenge and transformation of a budgetary regime: The endogenization of welfare regulation by institutional entrepreneurs

Our historically-informed field study focuses upon the socio-political processes by which heterogeneous budgeting compromises are reached by a variety of contending parties in seeking and resisting fundamental change, as well as the consequences of those compromises within the State of Wisconsin’s transformative Welfare Works (W-2) Program. Despite the continuing political rhetoric of comprehensive changes in the manner in which budgets are formulated, and, more broadly, the welfare system through adoption of a “market-based delivery system” and “performance-based contracts,” we find that the adopted and transformed regulation and budgeting regime facilitated more incremental changes in welfare delivery. Our field observations identify the manner in which budgeting facilitated this shift from a comprehensive to incremental strategy in terms of: (1) the malleable nature of budgeting, which provided the needed organizational flexibility to shift resources from one application to another in an ostensibly rational manner, thereby ensuring the legitimacy of the emerging organizational arrangements and related dramatic budget cuts under W-2; and (2) the active role played by institutional entrepreneurs in the construction, challenge and deployment of budgets in shaping, and thereby endogenizing welfare reform regulations at both the federal and state level. Refining our theoretical line of reasoning, field observations suggest that W-2 and the social context to which it was applied were mutually endogenous rather than fully endogenous, and that the principal actors implicated in the change process may be more aptly described as cultural entrepreneurs rather than institutional entrepreneurs; they also suggest that the forms endogenization and entrepreneurship take are reciprocally interdependent such that the manner in which each plays out conditions the other. Implications are explored.     

Developing a Global Model of Accounting Education and Examining IES Compliance in Australia,Japan, and Sri Lanka

The introduction of International Education Standards (IES) signals a clear move by the International Accounting Education Standards Board (IAESB) to ensure high quality standards in professional accounting education at a global level. This study investigated how IES are perceived and valued by member bodies and academics in three counties: Australia, Japan, and Sri Lanka. It examined: (1) levels of awareness of IES; (2) drivers of compliance and convergence and non-compliance and non-convergence with IES; and (3) key factors influencing IES adoption. Both quantitative and qualitative data have been collected from interviews and questionnaire surveys to report on these findings. Further, as part of the study, comprehensive case studies of the accounting education systems of Australia, Japan, and Sri Lanka were developed. These case studies not only provided an insight into issues of diversity, culture, and language as they relate to IES, but also preceded the development of a global model of accounting education.¹1 In this paper, accounting education refers to education that is provided at both university level (or equivalent) and that offered by member bodies. This model is proposed as a way to assist interested parties in any country to readily identify their own unique system of professional accounting education.     

Where were the auditors? Using AAERs in introductory or advanced auditing courses

I provide instructions for use of a Securities and Exchange Commission (SEC) Accounting and Auditing Enforcement Release (AAER) assignment by instructors in Introductory or Advanced Audit Courses. The assignment gives students an opportunity to use the knowledge they have gained from their auditing and other accounting courses. Students analyze what was done by individuals in a company to cause the SEC to issue an AAER and what the external auditors could have done to prevent the AAER from happening. A secondary feature of the assignment is that students are able to practice their presentation skills by presenting their analysis to their class members and instructor. The assignment can also lead to class discussion on ethics and what ethical dilemmas practicing auditors are faced with.     

Telemonitoring bei Patienten mit arterieller Hypertonie – medizinischer Nutzen und Wirtschaftlichkeit

Background

Arterial hypertension is a widely spread disease which can lead to serious adverse events. On the one hand, an optimal therapy should be provided, and on the other hand it is of major importance to search actively for opportunities to further improve usual care.

Objectives

The objective is to conduct a literature review about “Improvement of health care by telemonitoring in patients with arterial hypertension”. Moreover, potential target groups for telemonitoring and the cost-effectiveness of telemonitoring are discussed.

Methods

Firstly, it was searched for relevant reviews with help of predefined search terms and in- and exclusion criteria (2005–2015). Subsequently, the second step consisted of a literature search for RCTs (2013–2015). The final studies (12 reviews/6 RCTs) were systematically analyzed and summarized in a qualitative way.

Results

It is clear that blood pressure telemonitoring is able to lower blood pressure additionally to usual care. With regards to emerging costs, telemonitoring is initially associated with higher costs. When long-term effects are taken into account, telemonitoring can be classified as cost-effective (1 study). Furthermore, specific patient subgroups (such as patients with uncontrolled hypertension) can particularly benefit from telemonitoring.

Conclusions

It is clear that telemonitoring results in an additional reduction of blood pressure compared to usual care. High risk groups can particularly benefit from telemonitoring. Future telemedical studies should focus more on health economic aspects as the current evidence is limited.

     

Institutional monitoring through shareholder litigation

This paper investigates the effectiveness of using securities class action lawsuits in monitoring defendant firms by institutional lead plaintiffs from two aspects: (1) immediate litigation outcomes, including the probability of surviving the motion to dismiss and the settlement amount, and (2) subsequent governance improvement such as changes in board independence. Using a large sample of securities lawsuits from 1996 to 2005, we show that institutional investors are more likely to serve as the lead plaintiff for lawsuits with certain characteristics. After controlling for these determinants of having an institutional lead plaintiff, we show that securities class actions with institutional owners as lead plaintiffs are less likely to be dismissed and have larger monetary settlements than securities class actions with individual lead plaintiffs. This effect exists for various types of institutions including public pension funds. We also find that, after the lawsuit filings, defendant firms with institutional lead plaintiffs experience greater improvement in their board independence than defendant firms with individual lead plaintiffs. Our study suggests that securities litigation is an effective disciplining tool for institutional owners.     

Restricted Voting Stock, Acquisition Premiums, and the Market Value of Corporate Control

This paper examines the valuation and financial histories of 152 British firms that have two or more common share classes with differential voting rights outstanding at some time between 1955 and 1982. Over 16,000 monthly price pairs are examined, and on average, the superior voting (SV) shares market prices exceed those of the otherwise equivalent class of restricted voting (RV) shares by 13.3 percent. Liquidity factors, if anything, attenuate this result since RV shares trade much more frequently than SV shares. Forty-three of the sample companies are acquired while they have multiple share classes outstanding, and a higher price is paid for the SV share class than for the RV share class in 37 cases. The SV share price premium is found to be positively related to insider holdings of SV shares and negatively related to insider holdings of RV shares.     

The expected discounted penalty function: from infinite time to finite time

In this paper we study the finite-time expected discounted penalty function (EDPF) and its decomposition in the classical risk model perturbed by diffusion. We first give the solution to a class of second-order partial integro-differential equations (PIDEs) with certain boundary conditions. We then show that the finite-time EDPFs as well as their decompositions satisfy this specific class of PIDEs so that their explicit expressions are obtained. Furthermore, we demonstrate that the finite-time EDPF may be expressed in terms of its ordinary counterpart (infinite-time) under the same risk model. Especially, the finite-time ruin probability due to oscillations and the finite-time ruin probability caused by a claim may also be expressed in terms of the corresponding quantities under the infinite-time horizon. Numerical examples are given when claims follow an exponential distribution.     

Irish credit unions: Differential regulation based on business model complexity

This study examines the business model complexity of Irish credit unions using a latent class approach to measure structural performance over the period 2002 to 2013. The latent class approach allows the endogenous identification of a multi-class framework for business models based on credit union specific characteristics. The analysis finds a three class system to be appropriate with the multi-class model dependent on three financial viability characteristics. This finding is consistent with the deliberations of the Irish Commission on Credit Unions (2012) which identified complexity and diversity in the business models of Irish credit unions and recommended that such complexity and diversity could not be accommodated within a one size fits all regulatory framework. The analysis also highlights that two of the classes are subject to diseconomies of scale. This may suggest credit unions would benefit from a reduction in scale or perhaps that there is an imbalance in the present change process. Finally, relative performance differences are identified for each class in terms of technical efficiency. This suggests that there is an opportunity for credit unions to improve their performance by using within-class best practice or alternatively by switching to another class.     

Identifying the Effect of Securitization on Foreclosure and Modification Rates Using Early Payment Defaults

This paper develops and estimates an instrumental variables strategy for identifying the causal effect of securitization on the incidence of mortgage modification and foreclosure based on the early payment default analysis performed by Piskorsi et al. (J Financ Econ 97:360–397, 2010). Estimation results show that securitized mortgages are more likely to be modified and less likely to be foreclosed on by servicers. These results are consistent with the interpretation in Adelino et al. (2009) that low modification rates are not the result of contract frictions inherent in the mortgage securitization process.     

The dispersion anomaly and analyst recommendations

The main objective of this study is to distinguish whether the forecast dispersion anomaly is due to Miller’s (J Finance 32(4):1151–1168, 1977) overpricing hypothesis or idiosyncratic risk, by conditioning the sample on “buy” and “sell” consensus recommendations. Observations on the long and short possibilities provided to the investors by the analyst stock recommendations can help us infer on the impact of short sale constraints even though they are not directly observed. This study provides strong evidence that the impact of analyst forecast dispersion is more pronounced in the group of stocks that receive the least favorable recommendations in a given period, even after controlling for the idiosyncratic risk, Fama–French factors (J Financ Econ 33(1):3–56, 1993; J Financ Econ 116(1):1–22, 2015) and even short-sale constraints. These results are consistent with Miller’s (1977) hypothesis, according to which if short-sale constraints bind, high opinion divergence stocks become overpriced and hence have low subsequent returns.     

Boundary spanning and gatekeeping roles of UK audit committees

Post-financial crisis, audit committee (AC) reforms are proposed to improve the quality of financial reporting.^?? The editorial process for this paper was undertaken by Pauline Weetman, former ABR editor. This paper's empirical contribution is to investigate the extent to which ACs and audit committee chairs (ACCs) engage with chief financial officers (CFOs) and audit partners (APs) across a range of 32 financial reporting issues. It is the first large-scale survey of interactions to move beyond the micro-CFO/AP dyad and to distinguish the individual ACC from the AC group. While 37% of the 5445 reported discussions involve all three key individuals together with the full AC, 35% involve neither the AC nor the ACC and the ACC acts without the full AC in a significant minority of cases. The parties reported to be involved are similar across the three respondent groups but vary with financial reporting issue, company size and audit firm size. The paper's theoretical contribution is to interpret the evidence using the concepts of boundary spanning and gatekeeping roles. The research reveals incomplete levels of AC and ACC engagement with financial reporting issues. Findings have implications for policy-makers regarding the role, influence and effectiveness of the AC in financial reporting matters. Directions for future research are identified.     

The impact of TOEFL scores on placement and performance of international students in the initial graduate accounting class

This paper examines, in a US context, the relationship between performance in the initial required graduate financial accounting class and Test of English as a Foreign Language (TOEFL) scores for a sample of international MBA students. Other variables that have been shown in the past to be associated with superior performance in that class for other samples are also considered for this international sample. These relationships have not been analysed by any previous studies. The results show that TOEFL scores are not associated with superior performance in graduate accounting for the international students. The Graduate Management Admission Test (GMAT) score is the factor most associated with superior performance in graduate-level accounting for international students. This result is consistent with the result reported in Krausz et al. (Advances in Accounting Education, 3(3), 169–177, 2000) for a sample of domestic US students.     

房地产价格对城镇居民收入差距的影响研究——基于区际差异化市场比较

运用聚类分析方法和五等法计算六大类别不同代表省市的基尼系数,依据2002~2011年省市面板数据考量6个不同类别省市房地产价格对收入差距的影响。结果表明:我国不同类别省市的房价波动对基尼系数的变动呈现出一定的差异性与区域性;第一、三类地区房价波动对城镇居民收入差距产生显著影响;第二类地区房地产市场投资投机活动不如第一、三类城市活跃,房价波动幅度比较稳定;第四、五类地区房价波动对收入差距的影响程度次于第二类地区;第六类地区房价波动幅度小,对收入差距不足以产生显著影响。     

REIT Momentum and Characteristic-Related REIT Returns

Recent evidence confirms that in factor-model examinations of the cross-section of REIT returns, REIT momentum emerges as the dominant driver. Acknowledging the importance of momentum, the current study explores whether and how REIT return patterns are linked to the underlying characteristics of the REITs themselves, in the manner of Daniel and Titman’s (Journal of Finance 52(1):1–33, 1997, Journal of Portfolio Management 24(4):24–33, 1998) characteristics model. Over the period 1993 through 2009, we find that after controlling for momentum, book-to-market, institutional ownership, and illiquidity are all strongly associated with REIT returns while size and analyst coverage are not. We further extend prior research by examining the influence of changes in interest rate cycles on REIT returns, and find that the characteristic-return relationships are heavily influenced by interest rates.     

Quadratic minimization with portfolio and intertemporal wealth constraints

We address a problem of stochastic optimal control motivated by portfolio optimization in mathematical finance, the goal of which is to minimize the expected value of a general quadratic loss function of the wealth at close of trade when there is a specified convex constraint on the portfolio, together with a specified almost-sure lower-bound on intertemporal wealth over the full trading interval. A precursor to the present work, by Heunis (Ann Financ 11:243–282, 2015), addressed the simpler problem of minimizing a general quadratic loss function with a convex portfolio constraint and a stipulated almost-sure lower-bound on the wealth only at close of trade. In the parlance of optimal control the problem that we shall address here exhibits the combination of a control constraint (i.e. the portfolio constraint) together with an almost-sure intertemporal state constraint (on the wealth over the full trading interval). Optimal control problems with this combination of constraints are well known to be quite challenging even in the deterministic case, and of course become still more so when one deals with these same constraints in a stochastic setting. We nevertheless find that an ingenious variational approach of Rockafellar (Conjugate duality and optimization, CBMS-NSF series no. 16, SIAM, 1974), which played a key role in the precursor work noted above, is fully equal to the challenges posed by this problem, and leads naturally to an appropriate vector space of dual variables, together with a dual functional on the space of dual variables, such that the dual problem of maximizing the dual functional is guaranteed to have a solution (or Lagrange multiplier) when the problem constraints satisfy a simple and natural Slater condition. We then establish necessary and sufficient conditions for the optimality of a candidate wealth process in terms of the Lagrange multiplier, and use these conditions to construct an optimal portfolio.     

The efficiency of IPO issuing mechanisms and market conditions: evidence in China

This study conducts a comparison analysis on the efficiency of bookbuilding and secondary market proportional offering (hereafter, SMP offering) in the China stock market. SMP offering as described in this paper is not a follow-on offering, but an initial offering applicable to investors in the secondary market. Specifically, as a unique type of fixed price offering, SMP offering only allows the existing investors who are holding shares (of any listed firms) in the secondary market to subscribe to IPO shares. The amount of IPO shares available to be subscribed by the existing investors is proportional to market value of shares held by them in the secondary market. We find some interesting evidence showing that, compared with bookbuilding, SMP offering is more efficient for pricing IPOs, particularly, in a volatile market. SMP offering leads to lower underpricing and lower cross-sectional variation of short-run returns of IPOs. Also, SMP offering is better able to counteract adverse market conditions in the form of low market return and/or high market volatility. Our results are robust to various alternative tests, e.g., the Heckman (Econometrica 47:153–161, 1979) two-stage procedure and an out-of-sample test, after controlling for the problem of endogeneity and for the influence of the exchange of listing, respectively.     

Affine forward variance models

We introduce the class of affine forward variance (AFV) models of which both the conventional Heston model and the rough Heston model are special cases. We show that AFV models can be characterised by the affine form of their cumulant-generating function, which can be obtained as solution of a convolution Riccati equation. We further introduce the class of affine forward order flow intensity (AFI) models, which are structurally similar to AFV models, but driven by jump processes, and which include Hawkes-type models. We show that the cumulant-generating function of an AFI model satisfies a generalised convolution Riccati equation and that a high-frequency limit of AFI models converges in distribution to an AFV model.

     

Variables influencing the customer relationship management of banks

Banks are important role players to the economy of any country. However, to survive in a competitive business environment banks need to focus on building and maintaining client relationships and to identify how their employees influence these relationships. This study investigates the influence of variables, with regard to bank employees, on the customer relationship management (CRM) of banks. A literature study explains CRM, the banking industry and employees' involvement with banking clients. To assess the impact of the predetermined variables from literature on the CRM of banks, a number of hypotheses were constructed and tested empirically among a sample of banking clients. The findings reveal that the variables knowledgeability and attitude of bank employees have a statistically significant impact on the effectiveness of the CRM strategies of banks. Based on the findings of the empirical investigation, strategies are provided for banks to improve their employees' knowledgeability and attitude in order to ensure more effective CRM strategies.