Discussion of “Managers' Discretionary Adjustments: The Influence of Uncontrollable Events and Compensation Interdependence”

In this discussion of Bol, Hecht and Smith (this issue; BHS), I examine their theory and experimental setting with the purposes of investigating how their study generalizes and identifying further research possibilities. First, I discuss the uncontrollable events the study addresses, which are influenceable and require innovative effort to prevent adverse effects. What follows next is an analysis of experimental design choices and their implications. In particular, results could be specific to the manipulation of event likelihood, as well as to the properties of the objective bonus system and form of subjectivity. This illustrates how evaluation system design properties can create diverse reference points and affect perceived fairness and discretionary adjustments. Together, these points indicate wherein the contribution of BHS lies, and provide an outline for future research opportunities by suggesting alternative research choices.     

Discretionary Accounting Accruals,Managers' Incentives,and Audit Fees*

This paper examines the linkages between discretionary accruals (DAs), managerial share ownership, management compensation, and audit fees. It draws on the theory that managers of firms with high management ownership are likely to use DAs to communicate value‐relevant information, while managers of firms with high accounting‐based compensation are likely to use DAs opportunistically to manage earnings to improve their compensation. OLS regression results of 648 Australian firms show that (1) there is a positive association between DAs and audit fees; (2) managerial ownership negatively affects the positive relationship between DAs and audit fees; and (3) this negative impact is further found to be weaker for firms with high accounting‐based management compensation.     

Discretionary Accounting Choices and CEO Compensation*

This paper makes four contributions to the literature relating accounting choices to CEO compensation. First, it shows that discretionary accruals are associated with CEO cash compensation, a result that holds after controlling for both the nondiscretionary components of income and increases in shareholder wealth. Although significant, the coefficient on discretionary accruals is significantly lower than that on nondiscretionary accruals, which in turn is significantly lower than the coefficient on operating cash flows. Second, the paper shows a differential reaction to positive and negative discretionary accruals —- the association between positive discretionary accruals and CEO cash compensation is significantly greater than the association between negative discretionary accruals and CEO cash compensation. Third, the paper shows the association between discretionary accruals and CEO cash compensation varies depending upon the circumstances of the firm. In particular, when positive discretionary accruals allow the firm to reduce or avoid a loss, the association between CEO cash compensation and discretionary accruals is significantly greater. Finally, this paper shows that the association of CEO cash compensation with reported income generally increases with the level of discretionary accruals, consistent with management responding to the incentives provided.     

Post‐IFRS Revaluation Adjustments and Executive Compensation

International Financial Reporting Standards (IFRS) allow firms to record adjustments (gains or losses) from the revaluation of investment properties in their income statements. After Hong Kong adopted IFRS in 2005, property companies were required to move their revaluation gains and losses (RGL) from equity to income. We find RGL to be a significant determinant of executive compensation in these firms after 2005, but not before. We further find evidence that the RGL‐compensation association is driven by firms with relative weak corporate governance structure, such as firms in which the controlling shareholders own a relatively small percentage of shares, firms in which the controlling shareholders have control rights that exceed ownership rights, and firms that are no longer run by their founders.     

The Influence of Affect on Managers' Capital‐Budgeting Decisions*

In this paper, we propose that affective reactions are integral to accounting decision contexts like capital budgeting, and that researchers must jointly consider affect and cognition to better understand accounting decision makers' behavior. We argue that interpersonal relationships are characteristic of many capital‐budgeting contexts, and that these relationships can lead to emotional affective reactions. For example, reactions such as frustration and anger may result if a manager is treated unfairly by another individual involved in a capital project. Drawing on relevant work in neurobiology and psychology, we then predict that these affective reactions can influence managers' capital‐budgeting decisions. We report on four experimental scenarios that demonstrate the impact of affective reactions on capital‐budgeting decisions. Consistent with our predictions, the results indicate that managers consider both financial data and affective reactions when evaluating the utility of an investment alternative. Our results suggest that researchers should consider both affect and cognition to more fully understand decision making in accounting contexts.     

欧佩克面临的挑战及调整

石油输出国组织(欧佩克)[1]诞生在20世纪60年代,是世界石油工业和石油经济发展、世界石油市场和国际石油贸易变革,以及世界石油地缘政治和国际石油关系演化的综合产物。它的发展、变化始终没有离开过世界石油发展演进的大环境,同样,也自始至终影响世界石油市场的发展进程。两者相互依存、相互影响。21世纪,石油工业和石油经济进入了一个新阶段,欧佩克的未来前途也面临新的挑战和机遇。对伊战争,加快了世界石油市场格局的变化进程。这一变化是朝着石油市场一体化的方向发展。欧佩克作为世界经济和世界贸易活动中的重要参与者,在经济全球化的…     

欧佩克面临的挑战及调整

石油输出国组织(欧佩克)诞生在20世纪60年代,是世界石油工业和石油经济发展、世界石油市场和国际石油贸易变革,以及世界石油地缘政治和国际石油关系演化的综合产物.它的发展、变化始终没有离开过世界石油发展演进的大环境,同样,也自始至终影响世界石油市场的发展进程.两者相互依存、……     

亚洲工厂及关联度分析

依据亚洲零部件贸易数据,作者采用了依存比率的方法对亚洲工厂的规模、工厂内部以及同美国之间的相互依存关系进行了研究。研究结果发现,亚洲工厂的规模超过北美洲和欧洲工厂,成为了世界上最大的工厂。亚洲零部件内部贸易额及比重超过了欧盟,这说明亚洲生产的一体化程度更高。从零部件进出口规模角度看,亚洲地区的经济体均高度依赖亚洲工厂的活动,而亚洲工厂对中国的依存度则最高,对日本的依赖程度只排在第三位,这说明中国是亚洲工厂的核心平台。美国在亚洲贸易中的重要性主要体现为中国的最终产品出口对美国市场存在严重依赖,而亚洲主要经济体对中国市场的出口已经超过对美国的出口,亚洲工厂对于美国的依赖程度并不高,远远低于亚洲工厂对中国内地和中国香港的依赖。相反,美国对亚洲工厂的依赖程度则远高于亚洲工厂对美国的依赖。     

相互依赖对经销商依从的影响研究

相互依赖是渠道研究中的一个核心概念,它对渠道关系行为产生重要影响。依从是关系行为的一个重要维度,但国内外学者尚未探讨相互依赖与依从之间的关系。文章关注相互依赖的两个维度——总体相互依赖与相互依赖非对称——对经销商依从的影响。研究发现,制造商-经销商双边关系中,总体相互依赖促进经销商依从,而相互依赖非对称弱化经销商依从。     

The Influence of Ownership and Compensation Practices on Charitable Activities

Recent accounting research provides evidence that similar profit‐based compensation incentives are used in for‐profit and nonprofit hospitals. Because charity care reduces profits, such incentives should lead for‐profit hospital managers to reduce charity care levels. Nonprofit hospital managers, however, may respond differently to the same incentives because they face a different set of institutional pressures and constraints. We compare the association between pay‐for‐performance incentives and charity care in for‐profit and nonprofit hospitals. We find a negative and significant association between charity care and our proxy for profit‐based incentives in for‐profit hospitals, and no significant association in nonprofit hospitals. These results suggest that linking manager pay to profitability does not appear to discourage charity care in nonprofit hospitals. Apparently, the nonprofit mission, institutional pressures, and ownership constraints moderate the potentially negative effects of profit‐based incentives. Because this evidence partially alleviates concerns over nonprofit compensation arrangements that mirror those used in for‐profit hospitals, it should be of interest to regulators and policymakers. In addition, this study provides insights into accounting researchers about institutional and organizational influences that affect managerial responses to financial incentives in compensation contracts.     

The Interdependence Between Commodity-Price and GDP Cycles: A Frequency-Domain Approach

Atlantic Economic Journal - In this paper, the interdependence between aggregate commodity prices and world gross domestic product (GDP) is studied by performing two empirical exercises with...     

Interdependence between The Netherlands and Germany: Forecasting with VAR models

Summary The German economy is usually assumed to take a leading position. In principle this gives smaller countries, which are dependent on Germany, the opportunity to predict their own economic future conditional on the state of the German economy. This paper uses this opportunity for The Netherlands by applying a Vector Auto Regressive model on Dutch and German series. Because the traditional VAR models appear to be overparameterized, their forecast performance can be improved significantly by using shrinkage estimators based on the so-called Minnesota prior. Such a Bayesian VAR forecasts well and confirms the interdependence between Germany and The Netherlands. Variance decomposition of forecast errors and impulse response simulations strengthen the impression that the BVAR model properties are plausible.The author works at the Econometric Research and Special Studies Department of the Nederlandsche Bank. He is grateful to M.M.G. Fase, C.C.A. Winder and two anonymous referees for their useful comments and to R.B.M. Vet for his assistance in various calculations.     

The Interdependence and Cause of Japanese and US Stock Prices: An Event Study

This paper analyses the interdependence between the US and Japanese stock price indexes, focusing on whether it exists only when a large change in the index occurs and what its possible causes are. To this end, I employ a kind of 'event study', which seeks to investigate whether the stock price index of one country significantly reacts only to a large change in the index of the other country. The results suggest that: (i) a strong two-way causality between the indexes is recognized clearly when one index shows a large change, while the interdependence is much less clear for small changes; and (ii) the news of a large fall or rise of the index itself plays an important role in the interdependence.     

The Competitiveness of Former Coalfields: Manufacturing Managers' Perceptions of Competitiveness Strengths and Weaknesses in South Yorkshire

The last decade has seen a wide recognition of the chronic economic adjustment problems of the former coalfields of the UK. Arguably, the finest example of such an ex-mining area has been South Yorkshire. Common perceptions are of old mining communities that are lacking the key requisite characteristics to be sufficiently able to generate new and alternative forms of employment. That is, ex-coalfields are widely seen as possessing a poor set of the determining factors of economic competitiveness. This paper uses a study of manufacturing managers' perceptions of the determinants of competitiveness in the former mining area of South Yorkshire in order to shed new light on an established debate. It also takes an established methodology for assessing regional competitiveness and develops it into a more focused and valuable tool in feeding into the policy-making agenda. On the basis of the findings, some of the current policies aimed at the revitalisation of the economy of South Yorkshire's former coalfield are discussed, and a number of additions are suggested.     

Employment and Labor Productivity in Macroregions of Russia: Spatial Interdependence

The article shows that indicators of spatial distribution of employed and economic potential are becoming the key indicators of the economic development of Russia. It has been revealed that the localization of these resources determines the regional differentiation in labor productivity. Regression relationships between labor productivity, employment, urbanization parameters, agglomeration and localization have been determined. The forecast of regional localization of employment on macroregions of Russia has been carried out.     

中美经济相互依赖关系中的“债务人逻辑”

形成于后布雷顿森林体系的债务人逻辑是对债务国与金融霸权并存和共生关系的阐释。这一逻辑表明,美国可以借助债务国的身份维持其金融霸权;而这一逻辑形成的前提则与美国一系列的制度设计、政治外交手段以及金融霸权的权力资源转化密切相关。由于这一逻辑的影响,中国在中美经济相互依赖关系中暴露出严重的脆弱性和非对称性。为降低这一逻辑的影响,中国需要从制衡和结构这两个视角,降低在美元体系中的存在成本。     

沉淀成本对人力资本投资的影响及对策分析

知识更新换代速度加快和产业结构分工细化导致人力资本折旧率上升,由此引起的人力资本投资沉淀成本的影响愈加明显。文章建立了包含沉淀成本的人力资本投资模型,考察了教育和干中学两种情况下沉淀成本对人力资本投资的影响。结果表明,沉淀成本对人力资本投资选择存在较大影响,而干中学则可以有效地减轻沉淀成本对人力资本投资的影响。最后探讨了减轻沉淀成本影响,促进人力资本积累的建议。