Are Employee Selection and Incentive Contracts Complements or Substitutes?

There is a debate in the literature as to whether employee selection is a substitute or complement to incentive contracting. We argue that incentive contracts and selection can be both complements and substitutes conditional on the contracting difficulty faced by the firm. We examine these control choices in a setting where contracting difficulties arise due to the firm's choice of strategy and from the volatility created by the firm's external environment. We select a firm's commitment to organizational learning (OL) as our strategic choice variable as this provides a useful proxy for identifying settings where explicit incentive contracting is difficult. The results show that, as firms become increasingly committed to OL, incentive contracts and employee selection operate as complements. However, with a high commitment to OL and an increasing level of external volatility, contracting on performance measures will become less effective. In this context, our results indicate that there is a substitution effect toward employee selection.     

Students' Perceptions of a Scaffolded Approach to Learning Financial Planning: An Empirical Study

In the aftermath of the global financial crisis (GFC), one understandable area of scrutiny and pressure for reform is the educational background and professionalism of personal financial advisers. This Australian study reports on a three-year investigation into students' perceptions of ‘scaffolded’ instruction in financial planning. The scaffolded approach was used to assist learning in areas that previously had caused difficulty. The results indicate that students perceived the scaffolded tasks to be valuable learning experiences which increased their appreciation of the skills and knowledge required by financial advisers. Although students may bring different frames of reference to their learning, and the positiveness of perceived value of scaffolded instruction may vary between different demographic groupings, scaffolding techniques are shown to provide strong potential to assist university educators and their students in financial planning.     

Market efficiency and learning in an artificial stock market: A perspective from Neo-Austrian economics

An agent-based artificial financial market (AFM) is used to study market efficiency and learning in the context of the Neo-Austrian economic paradigm. Efficiency is defined in terms of the “excess” profits associated with different trading strategies, where excess is defined relative to a dynamic buy and hold benchmark in order to make a clean separation between trading gains and market gains. We define an Inefficiency matrix that takes into account the difference in excess profits of one trading strategy versus another (signal) relative to the standard error of those profits (noise) and use this statistical measure to gauge the degree of market efficiency. A one-parameter family of trading strategies is considered, the value of the parameter measuring the relative informational advantage of one strategy versus another. Efficiency is then investigated in terms of the composition of the market defined in terms of the relative proportions of traders using a particular strategy and the parameter values associated with the strategies. We show that markets are more efficient when informational advantages are small (small signal) and when there are many coexisting signals. Learning is introduced by considering “copycat” traders that learn the relative values of the different strategies in the market and copy the most successful one. We show how such learning leads to a more informationally efficient market but can also lead to a less efficient market as measured in terms of excess profits. It is also shown how the presence of exogeneous information shocks that change trader expectations increases efficiency and complicates the inference problem of copycats.     

Chinese Students’ Perceptions of the Teaching in an Australian Accounting Programme – An Exploratory Study

ABSTRACT

This exploratory study is designed to elicit and understand the views of Mainland Chinese students concerning their learning experience in an Australian accounting education programme. The article contributes to the literature by investigating the issues and implications associated with international students’ perceptions of teaching, as little research has been undertaken in this context. Data were obtained from focus group interviews at two Australian universities, comprising students who had no prior experience of Western education. Based on an adaptation of Ramsden's 2003 model [Learning to teach in higher education (2nd ed.). London: Routledge], the data show that the students’ educational experience in China has a direct and negative influence on their perceptions of the teaching and learning experience in Australia. The negativity is particularly strong for entry-level students but dissipates to some extent with time. Issues concerning teachers’ enthusiasm, commitment, delivery skills and students’ expectations also emerged as important factors affecting student perceptions.     

Fee Speech: Signaling, Risk-Sharing, and the Impact of Fee Structures on Investor Welfare

The fee structure used to compensate investment advisers iscentral to the study of fund design, and affects investor welfarein at least three ways: (i) by influencing the portfolio-selectionincentives of the adviser, (ii) by affecting risk-sharing betweenadviser and investor, and (iii) through its use as a signalof quality by superior investment advisers. In this paper, wedescribe a model in which all of these features are present,and use it to compare two popular and contrasting forms of feecontracts, the "fulcrum " and the "incentive " types, from thestandpoint of investor welfare. While the former has some undeniablyattractive features (that have, in particular, been used byregulators to justify its mandatory use in a mutual fund context),we find surprisingly that it is the latter that is often moreattractive from the standpoint of investor welfare. Our modelis a flexible one; our conclusions are shown to be robust tomany extensions of interest. The results are also extended toconsider unrestricted fee structures and competitive marketsfor fund managers.     

论影响学习的外在因素

现代社会是重效益的社会,学会学习尤为重要。学习作为一种社会性的活动,除了受到主观条件的制约外,还要受社会条件的制约。本文针对学习过程中的各种客观条件进行了分析,以便于读者特别是广大青年学生正确地认识影响学习的外在因素,从而掌握科学的学习方法和现代化的学习手段,努力学习,能够应付时代变化,做现代的主人。     

Evaluation of student feedback

We examine a flexible assessment system that allows students to determine the weights allocated to each course component and to re-allocate the weights in response to achieved scores. The flexibility is intended to encourage students’ participation in the learning process, thereby promoting self-regulated learning skills. We compare this assessment system to a traditional system and to another system, in which the students may choose their own weights but cannot change them later in the term. We examine the impact on students’ motivation as measured by the Motivated Strategies for Learning Questionnaire (MSLQ), as well as the impact on grades and students’ attitudes. Our results indicate little improvement in motivation, grades or attitudes when students design and commit to their grading plans early in the term. However, the more flexible system, which allows for re-allocation, appears to improve students’ grades, self-reported motivation and attitudes.     

Can machine learning models save capital for banks? Evidence from a Spanish credit portfolio

We study the impact of machine learning (ML) models for credit default prediction in the calculation of regulatory capital by financial institutions. We do so by using a unique and anonymized database from a major Spanish bank. We first compare the statistical performance of five models based on supervised learning like Logistic Lasso, Trees (CART), Random Forest, XGBoost and Deep Learning, with a well-known model like Logit. We measure the statistical performance through different metrics, and for different sample sizes and features available. We find that ML models outperform, even when relatively low amount of data is used. We then translate this statistical performance into economic impact by estimating the savings in capital when using an advanced ML model instead of a simpler one to compute the risk-weighted assets following the Internal Ratings Based (IRB) approach. Our benchmark results show that implementing XGBoost instead of Logistic Lasso could yield savings from 12.4% to 17% in terms of regulatory capital requirements.     

The role of investment banks in M&A transactions: Fees and services

We examine the pricing and performance of advisers in M&A transactions. We determine adviser quality on the basis of a contemporaneous market share measure and show that high quality advisers receive higher M&A advisory fees. High quality advisers also complete deals faster, but their superiority is not reflected in increasing the likelihood of deal completion or delivering greater abnormal equity returns to their clients. It is well known that stock bids are received more negatively than cash bids, so we further partition the sample of acquirers by consideration type and examine the abnormal returns of each partition. We find that high quality investment banks are able to differentiate themselves by delivering greater abnormal returns to their acquirer clients in deals involving stock.     

Sharing corporate tax knowledge with external advisers

Tax knowledge is critical for companies to comply with tax laws and engage in tax planning and avoidance. Firms rely on external advisers in handling tax issues, however, sharing corporate tax knowledge with external advisers entails both opportunities and risks. We identify four relational factors that are associated with the decision of corporate taxpayers to share knowledge with external tax advisers. Survey data from 221 corporate taxpayers reveals a novel distinction between operational and strategic knowledge sharing. The operational dimension has a functional nature, whereas the strategic dimension has a more intentional character. Accessibility to, and a positive experience with, external advisers enables operational knowledge sharing. When firms perceive specific tax benefits in relation to sharing knowledge, they are more inclined to engage in operational knowledge sharing with external advisers but less prone to strategic knowledge sharing. Instead, strategic knowledge sharing is enhanced when firms have access to, and value the knowledge of their advisers, although this latter factor plays no significant role in explaining operational knowledge sharing. A positive experience with advisers also associates with strategic knowledge sharing. We link our results to other research and discuss implications for regulators considering, or requiring, firm disclosures of corporate tax strategy.     

Students' Perceptions of the Introduction of a Blended Learning Environment: An Exploratory Case Study

Virtual Learning Environments (VLE) provide the opportunity to deliver blended learning approaches that combine mixes of Information and Communications Technology (ICT) with various delivery methods and media. In 2008 and 2009, the University of Winchester in the UK redesigned a variety of accounting and financial management modules for presentation in a blended learning environment. An exploratory, qualitative case study investigated students' perceptions of the new approach. Through focus groups, students reported favourably on the blended learning approach and the views of students correlated with previous research, although there were some contrary findings. Focus groups raised issues concerning students' expectations, competence and engagement. Resources and institutional practices were identified as factors in students' attitudes towards blended learning. Issues about communication, student interaction and collaboration also emerged. Finally, some practical lessons from this case study are proposed.     

Machine learning for quantitative finance: fast derivative pricing,hedging and fitting

In this paper, we show how we can deploy machine learning techniques in the context of traditional quant problems. We illustrate that for many classical problems, we can arrive at speed-ups of several orders of magnitude by deploying machine learning techniques based on Gaussian process regression. The price we have to pay for this extra speed is some loss of accuracy. However, we show that this reduced accuracy is often well within reasonable limits and hence very acceptable from a practical point of view. The concrete examples concern fitting and estimation. In the fitting context, we fit sophisticated Greek profiles and summarize implied volatility surfaces. In the estimation context, we reduce computation times for the calculation of vanilla option values under advanced models, the pricing of American options and the pricing of exotic options under models beyond the Black–Scholes setting.     

Anforderungen an die Abbildung von Versicherungsunternehmen im Rahmen mathematisch-ökonomischer Modelle in der Unternehmenspraxis

The article analyses the requirements which are to be fulfilled when modelling the insurance business from an economic perspective by means of mathematical models. The goal of the discussion is to define what the management needs to draw meaningful conclusions for steering of an insurance company. The authors emphasise the importance of the objective of the analysis, the different views which are important when analysing an insurer (book value versus market value perspective) as well as the importance of the timeline in models. The inclusion of time and the resulting options serve as a reference for the classification of models as being dynamic or static. A discussion of the validity of the model results, in the context of the basic assumptions of the model used, is given at the end of the article.     

Perceptions of the learning context and learning approaches: Implications for quality learning outcomes in accounting

This study analyses learning approaches, course perceptions and learning outcomes of a group of second year accounting students at an Australian university using qualitative data analysis techniques. The research method involves the development of a series of matrices linking types of motives and strategies used by students in their study, together with their perceptions of the learning context associated with learning outcomes. The study focuses on assessing the links between learning approaches and a qualitative assessment of students' conceptual understanding of aspects of financial accounting studied at the undergraduate level. The results confirm how individual differences in the perceptions of the learning context relate to study motives and strategies. The findings show how different forms of memorisation relate to study strategies and how the completion of accounting tasks link to students' perceptions of course requirements. There was also some evidence that, in terms of learning outcomes, students with sophisticated levels of understanding of concepts, tended to have consistent deep and achieving approaches to learning. This result was compared with students' academic performance as a measure of learning outcome. Discrepancies between these two measures of learning outcome are highlighted in the conclusions. The findings strengthen the case for further investigation of the use of measures other than academic performance in examining relationships between learning approaches and learning outcomes.     

商业银行学习模式与竞争力培育互动关系研究

银行的学习能力对其保持长久的生命力至关重要,而构建与竞争力培育实践相结合的学习模式更是我国银行的现实选择和客观要求.本文首先从理论上分析了银行学习与竞争力培育的互动关系,并从国外银行的实践角度进行了实证分析,认为基于竞争力构建学习模式是银行发展的必然选择;然后,对我国银行基于竞争力构建学习模式的意义进行了阐述,指出其具有较好的应用前景;最后,提出了基于竞争力的三个层面学习模式.本文认为,基于我国银行现有的学习能力,应该采取相关的辅助性策略,以各种支持性措施逐步提高学习能力,从而缩短学习与竞争力培育的距离,渐次推进学习模式的演化.     

论专题教学与案例教学在国际贸易课程中的应用

国际贸易既是经济和管理类相关专业一门基础理论课又是重要的核心课程,在整个专业课程体系中发挥着重要的基础性作用,学好这门课程将为继续学习其他专业课程打下基础。然而,在过去传统的教学方法中,经常采用是全部进行理论讲授的教学方法,导致学生在学习过程中感到枯燥、乏味,同时学习的内容在实际工作中应用不了,从而削弱了学生的学习积极性。笔者在《国际贸易》课程的教学实践中,采用专题教学与案例教学相结合的方法,让学生不仅理解国际贸易的基本原理,更重要的是能够运用这些原理在工作实践中分析问题,解决问题。     

气候变化影响金融稳定的传导机制研究

各国中央银行和金融监管机构已经就气候变化对金融稳定的重大影响形成基本共识,但关于其传导机制的许多观点散见于文献,未形成清晰完整的研究脉络。本文在梳理总结现有文献的基础上提出新的分类方法,将气候变化对金融稳定的影响分为两类物理影响和一类转型影响,并将目前关于传导渠道的分析扩展为对传导机制的研究。在我国加快健全绿色金融体系建设、致力于实现“碳中和”目标的背景下,本文对相关研究和实践具有一定参考意义。     

The anxiety of learning. Interview by Diane L. Coutu

Despite all the time, money, and energy that executives pour into corporate change programs, the stark reality is that few companies ever succeed in genuinely reinventing themselves. That's because the people at those companies rarely master the art of transformational learning--that is, eagerly challenging deeply held assumptions about a company's processes and, in response, altering their thoughts and actions. Instead, most people just end up doing the same old things in superficially tweaked ways. Why is transformational learning so hard to achieve? HBR senior editor Diane Coutu explores this question with psychologist and MIT professor Edgar Schein, a world-renowned expert on organizational development. In sharp contrast to the optimistic rhetoric that permeates the debate on corporate learning and change, Schein is cautious about what companies can and cannot accomplish. Corporate culture can change, he says, but this kind of learning takes time, and it isn't fun. Learning is a coercive process, Schein argues, that requires blood, sweat, tears, and a certain level of anxiety to achieve the desired effect. In this article, he describes two basic types of anxiety--learning anxiety and survival anxiety--that drive radical relearning in organizations. Schein's theories spring from his early research on how American prisoners of war in Korea had been brainwashed by their captors. He cites the parallels between the "coercive persuasion" tactics the Chinese communists used to control their prisoners (isolating powerful ones and overseeing all communications) and the corporate boot camps that American companies use to indoctrinate their managers. Indeed, heavy socialization is back in style in U.S. corporations today, Schein says, even if no one is calling it that.     

An empirical assessment of the residual income valuation model

This paper provides an empirical assessment of the residual income valuation model proposed in Ohlson (Ohlson, J.A., 1995. Earnings, book values and dividends in security valuation. Contemporary Accounting Research 11, 661–687). We point out that existing empirical research relying on Ohlson's model is similar to past research relying explicitly on the dividend-discounting model. We establish that the key original empirical implications of Ohlson's model stem from the information dynamics that link current information to future residual income. Our empirical results generally support Ohlson's information dynamics. However, we find that our empirical implementation of Ohlson's model provides only minor improvements over existing attempts to implement the dividend-discounting model by capitalizing short-term earnings' forecasts in perpetuity.     

Exploring the role of learning style research in accounting education policy

The purpose of this paper is to introduce and describe the Experiential Learning Model and the Learning Style instrument developed by Kolb [1976]. Further, it is postulated that learning style may be a useful concept in making the accounting education process more effective and efficient.As a preliminary test of the concept, the Learning Style Inventory (LSI) was administered to accounting student samples of N = 172 and N = 187, respectively. Six hypotheses were tested using data obtained from the instrument. It is concluded that the LSI shows promise for generation of information useful in helping students and instructors understand the differing cognitive processes in accounting learning.