Lessee Reactions to Regulation of Accounting for Leases

This study examines lessee firms’ responses to Australian Accounting Standard 17, Accounting for Leases (AAS 17, 1987) and Approved Accounting Standard ASRB 1008, Accounting for Leases (ASRB 1008, 1987). Both Standards required that lessees capitalize finance leases, thus bringing the finance leases of many firms‘on balance sheet’ and increasing reported leverage. If the capitalization requirement altered firms’ equilibrium contracting cost distributions sufficiently, firms would take actions to mitigate its effect, possibly by altering their capital structures. The study examines whether the capital structures of these firms did change in response to the requirement, and if so, how. The results indicate that firms responded to the Standards by reducing their reliance upon finance leasing and increasing their reliance upon non-lease debt and shareholders’ funds. Firms do not appear to have used definitional interpretations to classify leases as operating rather than finance leases. As expected, the firms previously disclosing finance leases in footnotes experienced increases in non-lease debt reliance while the control sample (firms that previously capitalized the lease obligations) experienced decreases. Differences between control firms’ and footnote disclosure firms’ reactions to the Standard are generally consistent with contracting theory predictions. Control firms reacted to the loss of the potential to off balance sheet finance. Footnote-disclosure firms reacted to the loss of an already utilized off balance sheet financing technique.     

Vote Trading and Information Aggregation

The standard analysis of corporate governance assumes that shareholders vote in ratios that firms choose, such as one share‐one vote. However, if the cost of unbundling and trading votes is sufficiently low, then shareholders choose the ratios. We document an active market for votes within the U.S. equity loan market, where the average vote sells for zero. We hypothesize that asymmetric information motivates the vote trade and find support in the cross section. More trading occurs for higher‐spread and worse‐performing firms, especially when voting is close. Vote trading corresponds to support for shareholder proposals and opposition to management proposals.     

Why People Do Not Always Follow the Doctor's Orders: The Role of Hope and Perceived Control

The lack of adherence to medical advice is a widely recognized health care concern with important implications for consumer well‐being. This study advances a model for better understanding adherence behaviors by incorporating the positive emotion of hope and consumer perceptions of control. Empirical testing of the model in the context of type 2 diabetes, a lifestyle‐changing chronic illness, shows that hope generates more patient adherence. Furthermore, individuals have higher hope when they believe they are capable of performing the actions their treatment requires, and/or that their health outcomes are under their physician's control. The results indicate that health care providers can play an important role in encouraging adherence behaviors by cultivating hope and customizing their interactions with patients. Interventions aimed at increasing patient self‐efficacy or promoting patients' beliefs that health outcomes are under their physician's control are two routes to building hope. Health initiatives aimed at increasing diabetes treatment adherence should consider alternatives beyond asking patients to “take control” of their diabetes.     

The Housing and Credit Bubbles in the United States and Europe: A Comparison

A house price boom occurred simultaneously in the United States and in a number of European countries from 2003 to 2007, accompanied in each case by an expansion in housing finance. This article considers the role of financial innovation along with incomplete markets in these cycles.     

Discrimination is a Societal Issue Too: Moving Beyond Individual Behavior

Crowding in natural settings such as nature reserves may lead to both long-and short-term spatial and temporal behavioral adjustments. This study analyzes the short-term coping process as a function of the crowding disturbance in two popular nature reserves in Israel. Using binary and multinomial choice models, a direct robust connection between the crowding disturbance and a hierarchical set of behavioral responses was found. People less sensitive to crowding tried to avoid or reduce the length of the contact by changing pace. More sensitive visitors may change route. Finally, visitors most sensitive to crowding may terminate their visit altogether.     

Consumer knowledge and behaviour regarding safety of reusing food packaging materials

Consumers (n = 750) were surveyed regarding knowledge and behaviour concerning reuse of food packaging materials. Cross-tabulation of completed questionnaires (n = 597) indicated that middle-aged, urban and suburban women engaged in the highest number of correct packaging reuse practices. Nearly 50% of consumers thought egg cartons, plastic syrup bottles, produce bags and microwave meal plates were designed to be reused. Less than 50% thought it was safe to store food in containers formerly used to store non-food items, and that washed bread wrappers (turned inside-out were a safe material in which to store fresh food. Over 50% knew that plastic packaging contains additives that can end up in food, that packaging materials may be sterilized with chemicals or irradiation and that plastic wraps begin to melt at 71° (160°). Point Biserial Correlations indicated that behaviour was not necessarily consistent with knowledge.