Trading Against the Random Expiration of Private Information: A Natural Experiment

For years, the Securities and Exchange Commission (SEC) accidentally distributed securities disclosures to some investors before the public. We exploit this setting, which is unique because the delay until public disclosure was exogenous and the private information window was well defined, to study informed trading with a random stopping time. Trading intensity and the pace at which prices incorporate information decrease with the expected delay until public release, but the relation between trading intensity and time elapsed varies with traders' learning process. Noise trading and relative information advantage play similar roles as in standard microstructure theories assuming a fixed time window.     

Effects Of Obsolescence On Tax Depreciation Practice

To paraphrase an old saying: Everybody complains about the way obsolescence is handled in tax depreciation practice, but nobody has as yet found a solution that satisfies both the taxpayer and the tax collector. It is obvious that this problem is much too big to treat in detail in this short article, but an attempt will be made to discuss several aspects of the problem which the writer believes either have not been fully understood by most persons, or else have not been explained sufficiently by those who advocate certain procedures. In order to develop the subject adequately, it will be necessary to investigate certain matters not directly concerned with tax practice     

Global compliance with international accounting education guidelines

The International Accounting Education Guidelines (IAEG) of the International Federation of Accountants (IFAC) issued since 1982 specify the components for the Professional preparation to become a qualified accountant.

This paper presents the results of a survey of compliance conducted in fifty-four countries outside the USA with International Accounting Education Guidelines (IAEG), as issued by the International Federation of Accountants (IFAC). Its purpose is to provide a benchmark measure of compliance for current assessment of accounting education, and for reference in future studies. This study is the first attempt to examine compliance with IAEGs in all sectors of the world in which IFAC has members. The paper is divided into the following sections: international accounting education guidelines; survey questions; methodology; results; effectiveness of the guidelines, and summary and conclusions.     

Renaissance attachment to things: material culture in last wills and testaments1

Over the past decade ‘material culture’ has become a sub‐discipline of Italian Renaissance studies. This literature, however, has focused on the rich and their objects preserved in museums or reflected in paintings. In addition, the period 1300 to 1600 has been treated without attention to changes in the relationship between people and possessions. The article turns to last wills and testaments, which survive in great numbers and sink deep roots through late medieval and Renaissance cities and their hinterlands. They reveal aspirations and anxieties about things from post‐mortem repairs to farm houses to pillows of monk's wool. These aspirations changed fundamentally after the Black Death. Earlier, during the ‘commercial revolution’, ordinary merchants, artisans, and peasants on their deathbeds practised what the mendicants preached: stripping themselves of their possessions, they converted their estates to coin to be scattered among pious and non‐pious beneficiaries. After the Black Death, testators began to reverse tack, devising ever more complex legal strategies to govern the future flow of their goods. This work of the dead had larger economic consequences. By encouraging the liquidation of estates, the earlier mendicant ideology quickened the velocity of exchange, while the early Renaissance attachment to things did the opposite.     

The Effects of Food Color on Perceived Flavor: A Factorial Investigation in India

We extend research testing the effects of food color on flavor to a new cultural setting—India. We test color’s effect at three levels: flavor identification, perception, and preference. One hundred twenty-two graduate students at an Indian business school enrolling students from all parts of India were assigned the task of tasting and evaluating an orange-flavored carbonated water. Color at two levels (purple and orange) and label information at two levels (told orange flavor, told grape) were manipulated in a full factorial, between-subjects design. Results confirm that food color affects the consumer’s ability to correctly identify flavor as well as to form distinct flavor profiles and preferences. Food color dominates other flavor information including labeling and taste, though the strength of the effect is less pronounced in this setting. Strategic alternatives for the effective deployment of food color for promotional purposes are recommended.     

OBESITY AND MORAL HAZARD IN DEMAND FOR VISITS TO PHYSICIANS

In this article, we use count data regression with sample selection to analyze the effects and degree of moral hazard in demand for visits to physicians among groups of individuals with similar body mass index (BMI). Our results suggest that the effect of moral hazard on the demand for visits to doctors is increasing in BMI for men and for overweight and obese women. Moral hazard is highest among overweight men. (JEL I11, C25)     

Can Audit Partners Predict Subordinates' Ability to Detect Errors?

This study examines audit partners' predictions of the ability of managers and seniors to detect financial statement errors. If partners are unable to predict the ability of their subordinates to detect errors, audit effectiveness may be affected. Audit partners are asked to predict which members of the audit team (managers or seniors) are able to detect specific types of errors. These predictions are then compared to errors detected by managers and seniors that are seeded in working papers. The results show that partners (1) exhibit significant overconfidence in the ability of subordinates to detect errors, (2) are more accurate in predicting managers' performance than seniors, (3) are more accurate at predicting subordinates' ability to detect mechanical (simple) errors than conceptual (complex) errors, and (4) are not better at predicting subordinates' ability to detect more frequent and more important errors than less frequent and less important errors.     

The Demise of Investment Banking Partnerships: Theory and Evidence

In 1970 the New York Stock Exchange relaxed rules that prohibited the public incorporation of member firms. Investment banking concerns went public in waves, with Goldman Sachs the last of the bulge bracket banks to float. We explain the pattern of investment bank flotations. We argue that partnerships foster the formation of human capital and we use technological advances that undermine the role of human capital to explain the partnership's going‐public decision. We support our theory using a new data set of investment bank partnership statistics.     

Global Land Grabbing and Trajectories of Agrarian Change: A Preliminary Analysis

‘Land grab’ has become a catch‐all phrase to refer to the current explosion of (trans)national commercial land transactions mainly revolving around the production and export of food, animal feed, biofuels, timber and minerals. Two key dimensions of the current land grab – namely, the politics of changes in land use and property relations change (and the links between them) – are not sufficiently explored in the current literature. We attempt to address this gap by offering a preliminary analysis through an analytical approach that suggests some typologies as a step towards a fuller and better understanding of the politics of global land grabbing.