FOCUS: Using a Computerised Game in Teaching Business Ethics

Games have become a standard tool in management education. The authors have cooperated on developing just such a teaching aid for business people and management students interested in playing the business game ethically. Dr Higginson is Director of The Ridley Hall Foundation, Ridley Hall, Cambridge, CB3 9HG and Geoff Moore is Principal Lecturer at Newcastle Business School, University of Northumbria at Newcastle, Newcastle upon Tyne NE1 8ST.     

Integrated assessment of public investment in land-use change to protect environmental assets in Australia

A framework for comprehensive integrated assessment of environmental projects is developed and applied in partnership with a regional environmental body. The framework combines theory with practice, bringing a pragmatic and efficient approach to the rigorous assessment of projects for a large number of environmental assets in the north central region of the state of Victoria, Australia. The approach is codified as the Investment Framework for Environmental Resources (INFFER). The analysis assisted the environmental body to make strong business cases for a number of environmental projects, resulting in funding for those projects. Key features of the study include extensive participation of decision makers and stakeholders, integration of a comprehensive set of information about projects, explicit assessment of uncertainties and information gaps, and analysis of the most appropriate policy mechanism for each project. The process of applying the framework involved four steps: identification of around 300 important environmental assets in the region, filtering the list of assets to remove those that are less likely to provide opportunities for cost-effective public investment, development and detailed assessment of projects for a subset of assets, and negotiation of funding for projects. Implications for land-use policy include that environmental projects vary widely in their cost-effectiveness, requiring careful targeting of funds if environmental benefits are to be maximised. Many existing environmental programs use simplistic analyses to support decision making, resulting in missed opportunities for substantially greater environmental benefits. Promoting adoption of improved analytical methods is very challenging, requiring changes in mind-set and culture in environmental organisations. Widespread adoption is unlikely unless funders create incentives by rewarding those project proponents who undertake rigorous and comprehensive project assessments that focus on achievement of environmental outcomes.     

Strategies and dividend imputation: the effect of foreign and domestic ownership on average effective tax rates

This study examines how dividend imputation affects the incentive of New Zealand firms to minimize tax. By effectively eliminating double taxation on company income, imputation reduces firms’ incentives to engage in costly tax minimization strategies. Before September 1993, resident and nonresident shareholders were treated differently under New Zealand’s imputation system. Because imputation credits cannot be passed to shareholders unless dividends are paid, we expect firms to pursue different tax paying strategies depending on their level of foreign ownership and their dividend payout ratios. After September 1993 when imputation credits were extended to nonresident portfolio shareholders, we expect that firms with high foreign ownership and high dividend payouts would have less incentive to minimize tax. Our results provide some support for these expectations.     

Because you're worth it? Determinants of Vice Chancellor pay in the UK

Wage inequality has increased across most developed nations; this has been manifested in a wide range of organisations and sectors, with implications for well‐being and sustainability; within UK universities, this has become increasingly visible. There is increasing pressure on universities to deliver social and economic impact in an increasingly market‐driven and metric‐driven environment. In the UK context, increasing financial pressure has led to both an escalation of student fees and constrained wage growth for faculty. In contrast, most Vice Chancellors have secured substantive pay packages raising concerns that regulatory failures may be contributing to the rise. We show that Vice Chancellors use their internal power within organisations to extract a disproportionate amount of the value created by the institution. However, we encountered much diversity according to the quality of governance, highlighting the extent to which not only contextual but also internal dynamics drive wage inequality.     

Policy Determinants of School Outcomes under Model Uncertainty: Evidence from South Africa

In this paper, we assess the determinants of secondary school outcomes in South Africa. We use Bayesian model averaging techniques to account for uncertainty in the set of underlying factors that are chosen among a very large pool of explanatory variables in order to identify the subset of explanatory variables most strongly associated with the dependent variable. Our analysis indicates that the socio‐economic background of pupils, demographic characteristics such as population groups (Black and White), as well as geographical locations account for a significant variation in pupils’ achievement levels. We also find that the most robust policy determinants of pupils’ test scores are the availability of a library at school, the use of IT in the classroom as well as school climate.     

The Achievements and Future of Business Education

The dean of Columbia Business School is joined by the deans of Stanford, Harvard, and Wharton in discussing the challenges and opportunities facing today's graduate business schools. Most business schools aim to provide students with a certain body of knowledge—in disciplines such as marketing, finance, and accounting—as well as some general management and leadership training and skills. The biggest challenge to this model of business education is now coming from the high cost of the traditional two‐year MBA program and the threat of disruption by “online” alternatives. But the consensus of the four deans is that the combination of training and experience provided by today's top business schools will enable them to withstand the threat from online alternatives. And thus for the leaders of these top schools, one of the main challenges in designing and maintaining a successful business school program is to find the right mix of theory and practice, classroom and “experiential” learning. To the extent the schools succeed in achieving and maintaining this balance, they should continue to produce graduates who are sought by employers that include not only companies large and small, but non‐profits and, at some points in their careers, even the public sector. What's more, the deans all sense the growing demand for business to play a larger role in addressing social problems that have traditionally been seen as the responsibility of government and non‐profits. And one implication of this demand is that business schools, besides producing talent that finds its way to the public as well as private sectors, should prepare to play a greater role in the public debate over solutions to social challenges, such as protecting the environment while at the same time trying to stimulate enough economic growth to limit rising inequality.     

On Setting Prices and Testing Cross-Subsidy with Accounting Data

Regulators are often faced with the challenge of both setting efficient prices and avoiding cross subsidy. Successful implementation of these goals requires estimates of both marginal costs and incremental costs. We present a methodology for estimating both marginal and incremental costs for postal products. The proposed algorithms combine micro-unit accounting data and econometric estimation of the cost structure. We apply the methodology to the U.S. Postal Service and produce estimates of marginal and incremental costs for eighteen postal products and incremental costs for another four groups of products.