Euro area inflation: aggregation bias and convergence

Monetary policy of the European Monetary Union targets aggregate euro area inflation. Concerns are growing that a focus on aggregate inflation may cause national inflation rates to diverge. While different explanations for diverging aggregate euro area inflation have been brought forward, the very impact of aggregation on divergence has, however, not been studied. We find a striking difference in convergence depending on the level of aggregation. While aggregate national inflation rates are diverging, disaggregate inflation rates are converging. We find that aggregation appears to bias evidence towards non-convergence. Our results are consistent with prominent theoretical and empirical evidence on aggregation bias.     

Towards a More Comprehensive Understanding of the Roles of Management Accountants

Abstract

The study was designed to address specific gaps in the literature by identifying a comprehensive set of antecedents and characteristics with respect to the roles of management accountants (MAs) and exploring the consequences of how these roles are discharged. Interviews were conducted with 18 financial managers (FMs) and 18 operating managers (OMs) in medium and large manufacturing firms. Theoretical lenses of management control, contingency and role theory were used in the interpretation of the findings. A comprehensive picture of the antecedents, characteristics and consequences associated with the roles of MAs emerges from the data and the findings suggest that management and the MAs themselves play a critical part in the determination of the roles of MAs. In particular, the findings reveal contingencies and conflicts with regard to the interaction between MAs and OMs including the management control consequences associated with how MAs interact with OMs. For some MAs, the paper argues that role conflict, despite its negative connotations, may facilitate more effective management control. The adoption of a ‘business partner’ model for MAs is found here to be ambiguous, conditional and uncertain.     

Business Ethics Should Study Illicit Businesses: To Advance Respect for Human Rights

Business ethics should include illicit businesses as targets of investigation. For, though such businesses violate human rights they have been largely ignored by business ethicists. It is time to surmount this indifference in view of recent international efforts to define illicit businesses for regulatory purposes. Standing in the way, however, is a meta-ethical question as to whether any business can be declared unqualifiedly immoral. In support of an affirmative answer I address a number of counter-indications by comparing approaches to organized crime and to corporate crime, comparing the ethical critique of businesses studied in business ethics and those socially banned, and comparing the business ethics assumption as to businesses’ ethicality to societal ethical neutrality regarding war-related businesses. My conclusion: to help advance respect for human rights, business ethicists should apply their expertise to the task of defining illicit businesses.     

Does China have Inflationary Effects on the USA and Japan？

With China＇s share in global trade increasing rapidly, some argued in 2002-2003 that China was exporting deflation to other countries as it was dumping cheap goods in mature markets. Later, others argued that China was causing sharp increases in global prices. This paper uses several econometric techniques to assess the extent of the link between inflation rates between China and the USA and Japan. Only limited empirical evidence at the aggregate level is found for consumer price inflation in China leading to price changes in the USA and Japan. However, there is some evidence that inflation in the USA has an impact on Chinese inflation. The results seem consistent with the Federal Reserve and the Bank of Japan being concerned about inflation and, hence, adjusting policy such that inflation shocks have no significant effect on overall inflation. Recent Chinese price rises are unlikely to have a material effect on the USA or Japan.     

The two-tiered ethics of EDP

Ethical questions regarding access to and use of electronically generated data are (if asked) commonly resolved by distinguishing in Lockean fashion between raw (unworked) and refined (worked) data. The former is thought to belong to no one, the latter to the collector and those to whom the collector grants access. Comparative power separates free riders from rightful owners. The resulting two-tiered ethics of access is here challenged on the grounds that it inequitably establishes a rule of law for the strong while leaving the weak in a Hobbesian state of nature. Efforts at legislative constraints are reviewed; but such constraints are found to afford inadequate protections of privacy if a data subject may not prohibit others under ordinary circumstances from using recognizably name-linked data.Edmund F. Byrne is Professor of Philosophy at Indiana University in Indianapolis. His research interests center on policy and practices regarding technology, community, and social welfare. His most recent book isWork, Inc. (Temple University Press, 1990); and he is now writing another tentatively subtitledDemocracy, Civil Society, and Benevolence.     

Disaggregate Wealth and Aggregate Consumption: an Investigation of Empirical Relationships for the G7*

To date, studies of wealth effects on consumption have mainly used aggregate wealth definitions on a single‐country basis. This study seeks to break new ground by analysing disaggregated financial wealth in consumption functions for G7 countries. Contrary to earlier empirical work, we find that illiquid financial wealth (i.e. securities, pensions and mortgage debt) tends to be a more important long‐run determinant of consumption than liquid financial wealth. These results imply potential instability in consumption functions employing aggregate wealth. Our results are robust using SURE; when testing with a nested specification; and when using a linear model.     

The elasticity of the tax system of Zambia, 1966–1977

This paper studies the built-in responsiveness of the major types of taxes in Zambia to movements in their bases, particularly how it affected the contribution of these taxes to offsetting the decline in revenue from the mining sector over the sample period. Income taxes and domestic consumption taxes are shown to be elastic with respect to their proxy bases; the opposite holds for import duties. These findings are explained, inter alia, by the growth of the industrial and service sectors, rapid growth in the consumption of bottled beer, and the impact of the government's policy of import substitution.