Analysis of the Efficacy of Public Spending on Research and Development in State Programs

This paper presents an approach to assessing the efficacy of public spending on research and development in state programs. At present, there is a need to develop a unified approach to the analysis and evaluation of the efficacy of such spending from the perspective of participants in state programs (federal executive bodies). The proposed approach does not allow evaluating the efficacy of public spending on the development of research areas assigned to the authors.     

Should sequels differ from original movies in pre-launch advertising schedule? Lessons from consumers' online search activity

Sequels have become a profitable strategy in the U.S. motion picture industry because of their strong name recognition. However, while the established positioning of a sequel may help insulate it from competing firms' advertising messages, its familiarity may cause moviegoers to be more easily satiated with advertising from the sequel. Therefore, this study examines how sequels differ from original concept movies in terms of their ad effectiveness. We focus our analysis on pre-launch periods, given these periods' importance in shaping the financial outcomes of motion pictures. We consider the weekly online search volume of a movie as a measure of consumer interest in it, and thus as an intermediate response to pre-launch advertising. We then develop a model that assumes ad effectiveness can decline, due to copy and repetition wearout, and increase, due to forgetting, over time. We find that copy wearout is greater for original movies, while repetition wearout and forgetting are greater for sequels. These findings suggest that sequels should allocate more in early pre-launch periods and less immediately before release, relative to originals, to maximize pre-launch consumer interest.     

Macroprudential regulations and bank profit efficiency: international evidence

This study examines the impact of macroprudential regulations on bank profit efficiency. The latter is being estimated with a production frontier function using a cross-country dataset of more than 3000 banks from over 130 countries during 2013–2018. The results show that macroprudential regulatory policies diminish bank efficiency. This finding applies to both borrower-targeted and financial institutions-targeted policies, and it is robust to the inclusion of controls for microprudential regulations, financial consumer protection policies, and other county-level characteristics in the regressions.

     

Shareholder Activism and Voluntary Disclosure Initiation: The Case of Political Spending

Demand for disclosures on environmental, social, and governance (ESG) issues has increased dramatically. Using corporate political spending disclosures as our setting, we conduct a detailed inquiry of 541 political spending‐related shareholder proposals from 2004 to 2012 to highlight the role of shareholder activism as a mechanism to motivate ESG disclosure. Unlike earlier studies, we examine both proposals that went to a vote and proposals that were withdrawn by the activist, allowing us to assess more comprehensively the success of shareholder activism. We find that 20 percent of firms targeted by disclosure proposals begin disclosing in the subsequent year, although implementation rates vary by proposal type—8 percent for proposals subject to a vote versus 56 percent for proposals withdrawn. The sponsor is also important: unions and public pension funds are less likely than other activists to target firms with agency problems and are less successful in having proposals withdrawn, and the implementations they obtain are viewed more negatively by the broader investor base. Our findings highlight shareholder proposals as one mechanism through which investors can successfully express their preferences for corporate disclosure policies. Given activists' long‐standing interest in environmental and social disclosure policies, we believe our findings generalize to a broader set of ESG disclosures.     

Policy Uncertainty and the Dual Role of Corporate Political Strategies

Firms use active political strategies not only to mitigate uncertainty emanating from legislative activity, but also to enhance their growth opportunities. We find that a firm's systematic risk (beta) can be hedged away by employing various political strategies involving the presence of former politicians on corporate boards of directors, contributions to political campaigns, and corporate lobbying activities. The hedging effect is greater when firms operate in more uncertain industries. In addition, active political strategies are associated with greater firm heterogeneity and make real options more value relevant as potential drivers of competitive advantages in uncertain environments.     

Application of Standardization Methods for Environmental Improvement as an Element of Quality of Life Through the Development of a Company’s Business Potential

Various aspects of sustainable development and quality of life are considered, including the impact of standardization. Particular attention is paid to the study of the role played by standardization in improving environmental protection. In this connection the significance of standardization is shown as a factor of improving the technological potential of an enterprise and the quality of life. Various approaches to methods for assessing the effective impact of standardization on the quality of life are analyzed.     

Accounting for Option–based Compensation: The Economic Cost Approach

The intrinsic value approach amortizes over the life of the option, the difference between the stock price on the date of the grant and the exercise price of the option. The fair market value approach amortizes over the life of the option, the market value of stock options on the date of the grant. These approaches do not reflect the changes in the option–based compensation cost after the grant date. This paper proposes an economic cost approach that not only adjusts for the changes in the value of the options during its life but also records the issuance of the stock at fair market value on the exercise date.