BEYOND NEW PUBLIC MANAGEMENT: AGENCIFICATION AND REGULATORY REFORM IN NORWAY

In this paper we describe some trends in the development of regulatory reform in general and the agency form in particular. The focus is on the case of Norway by describing the reform process and some lessons learned. We discuss the development through the prism of different theoretical lenses such as instrumental, cultural and institutional environmental features. Finally, we draw some conclusions and discuss possible future developments beyond New Public Management by using a linear, a cyclical and a dialectical scenario.     

REGULATORY THREATS AND POLITICAL VULNERABILITY

During the 1992 U.S. presidential campaign and immediately after, the pharmaceutical industry was subjected to regulatory threats. It was charged with high drug costs, high advertising expense, and insufficient expenditure on research and development (R&D) to develop better drugs. We examine whether firms' measures of political vulnerability (higher advertising expense and lower R&D expenditure) influence the equity value effects of the regulatory threats. We find negative announcement effects around three regulatory threats. We then extend the analysis and find evidence consistent with our hypotheses that measures of political vulnerability are associated with more negative abnormal returns in response to the regulatory threats. JEL classification: G18, L50, L65.     

REGULATORY NEGOTIATION IN AUTOMOBILE INSURANCE REFORM

Tort reform of the motor accident insurance compensation scheme in the Australian state of New South Wales in 1999 came about as a result of an untested experiment in regulatory negotiation. This article is a first-hand account of the successful attempt to craft a consensual modification of the scheme through deliberations among a working group of service provider representatives. The author, a Canadian lawyer, investigated the prospects for change, acted as chief negotiator, and observed the legislative process that led to the final law reform.     

THE CHINESE SECURITIES REGULATORY COMMISSION AND THE REGULATION OF CAPITAL MARKETS IN CHINA

The rapid development of China’s capital markets necessitated the establishment of a regulatory agency that would administer market operations and protect investors’ interests. The Chinese Securities Regulatory Commission (CSRC) was established in 1992 for this purpose. In 1999, the Chinese Securities Law recognized the CSRC as the sole regulatory agency responsible for regulating securities instruments and markets in China. Although the CSRC is considered instrumental to Chinese accounting reforms and capital market development, it has remained relatively unexamined in the accounting literature. This paper contributes to the accounting literature by providing insight into an important regulatory agency that has enormous impact on the economic development of China. Specifically, this paper discusses the CSRC’s establishment and development, its regulatory efforts, and its achievements and shortcomings in its efforts to regulate China’s emerging capital markets. The underlying factors that explain some of the CSRC’s regulatory actions are also analyzed by discussing several cases involving fraudulent financial reporting.     

MERGER ACTIVITY AND MANAGERIAL COMPENSATION

A theoretical monopolistic economy is developed to explain relationships between merger activity and managerial compensation packages. In this economy, managers are assigned to and compensated by firms based on models established in “n” person cooperative game theory. Compensation packages offered to managers of potential acquiring firms are studied with respect to their impact on managers' willingness to initiate profitable merger bids. The model explains why overall merger returns decrease as the size of the target firm relative to the bidding firm increases. Model results are consistent with numerous other empirical findings regarding merger profit distributions.     

PERFORMANCE BASED COMPENSATION IN HEALTH CARE — A SWEDISH EXPERIENCE

In recent years most attempts at reforming health care in Sweden appear to be guided by ideals of decentralization and market orientation. Based on a longitudinal case study of five clinics in a large university hospital this paper questions the general applicability of the market framework in health care. The case story describes how a traditional overall budgeting system was replaced by a performance compensation system in which the clinics were paid a fixed price per unit produced. The new system involved the use of results, balance and funds statements and was also soon to be accompanied by another major reform introducing a purchaser-provider split organization in the county. The story ends by showing how the bold ambitions of establishing strict market like contracting forms fail to materialise and eventually get abandoned.     

2019年票据市场回顾与2020年票据市场展望

2019年面对国内外风险挑战明显上升的复杂局面,在以习近平同志为核心的党中央坚强领导下,全党全国贯彻党中央决策部署,坚持稳中求进工作总基调,坚持以供给侧结构性改革为主线,推动高质量发展,扎实做好六稳工作,保持经济社会持续健康发展。但是我国仍然处于转变发展方式、优化经济结构、转换增长动力的攻关期,结构性、体制性、周期性问题相互交织,三期叠加影响持续深化,经济下行压力加大。     

GOLF TOURNAMENTS AND CEO PAY—UNRAVELING THE MYSTERIES OF EXECUTIVE COMPENSATION

Leading financial economists and activist institutional investors have long argued that the proper alignment of manager and shareholder interests requires the use of performance based compensation. Partly in response to these pressures, and in combination with a change in the tax code that encourages performance-based pay, corporate boards have dramatically increased their use of stock grants and executive stock options. Combine this development with the longest bull market in U.S. financial history, and the result is unprecedented levels of CEO pay at the close of the 20th century. This review of executive compensation reveals that the economic theory of tournaments may provide a rationale for the pattern, if not the level, of executive pay. Specifically it finds that the total compensation of the five highestpaid executives in a cross-section of new and old-economy firms is very similar to the pattern of payouts to players in a golf tournament. The author also reports that recent studies show a significant increase in the pay-for-performance correlation throughout the 1990s. But whether that correlation is as high as it should be, and whether current levels of CEO pay are socially "optimal," are questions that remain unanswered.     

EXECUTIVE COMPENSATION STRUCTURE AND CORPORATE GOVERNANCE CHOICES

Using data that reflect the significant growth in incentive compensation during the last decade, we extend research in this area by specifying a more complete model that addresses both corporate governance and risk‐sharing factors that theory suggests should influence compensation policy. We find that the extent of incentive compensation is systematically related to other features of corporate governance, as well as to factors affecting managerial risk aversion. The results support the following conclusions: (a) the presence of outside directors and blockholders facilitates the use of incentive compensation, (b) incentive compensation is inversely related to use of leverage, and (c) the incentive pay component of compensation is lower for CEOs near or at retirement age and is decreasing in the percentage of firm stock already owned by the CEO. JEL classification: G34     

CONSISTENT ESTIMATION OF RESIDUAL VARIANCE IN REGULATORY EVENT STUDIES

This study presents new evidence on alternative methods used to test for abnormal returns in regulatory event studies where cross-sectional correlation in residuals is significant. Results contradict earlier studies that find no advantages to using joint generalized least squares (JGLS) methods over ordinary least squares (OLS). We find that in an actual regulatory event study cross-correlation is significant, and that failing to correct for this correlation results in substantially higher calculated F-statistics. In Monte Carlo simulations we find that OLS test statistics are not well specified when residuals exhibit cross-sectional correlation at levels that are reasonable to expect in daily return data, while JGLS test statistics are well specified. The study includes tests of the effective power of the OLS and JGLS statistics.     

COMMUNICATION PROCESSES AND THE ‘NEW PUBLIC SPACE’ IN ITALY AND THE USA: A LONGITUDINAL APPROACH

Since the time of ancient Greece, democracy and communication have ineluctably been linked. Seen with the eyes of the Greek citizens, the agora was a somewhat mystical space where direct involvement and face‐to‐face communication processes paved the way to the kratos of the demos. After more than two thousand years, communication still remains closely linked to democracy, but the ever expanding dimension of modern societies calls for political representation. Consequently, the electoral arena has become a fictitious public space making democracy work. With the agency and the communication theories in the background, the present authors claim that following the advent of the most incredible technological discontinuity in history, things seem to have taken a jump back in time. The widespread dissemination of Information and Communication Technologies (ICT), in fact, was crucial to the emergence of a ‘new public space’ bringing with it the poetry of a mirrored image of the ancient agora. Such new public space will be analysed with reference to the US and Italian governments at a federal and central level in order to gain a better understanding of how government‐citizens relationships are fashioned in both contexts. As we will see, each understanding of democracy argues for a different design of government‐citizens relationships. Consequently, both positive and recalcitrant attitudes towards a citizens’ greater involvement in policy making are often due more to cultural than to technological barriers. Their removal has to pass through the awareness that ICT may have profound consequences for democracy: their real power lies in their capacity to integrate political representation with new forms of citizens’ direct involvement in public life while consequently reinvigorating the pluralistic attitudes of the agora even in large‐scale modern democracies.     

HEDGED DIVIDEND CAPTURE AND EX-DAY RETURNS: AN EMPIRICAL UPDATE

We find that the magnitude of abnormal ex-day returns exhibited by US equities diminished in 1987 and 1988, subsequent to the US Tax Reform Act of 1986. We also report the results of a dividend capture strategy, hedged with the sale of stock index futures contracts. Hedging removes more than 50 percent of the risk of dividend capture, and even after transactions costs, can provide returns in excess of buying and holding the market portfolio of equities.     

LEVERAGE,RISK-SHIFTING INCENTIVE,AND STOCK-BASED COMPENSATION

Outstanding risky debt provides risk-shifting incentives for managers fully aligned with stockholders. Earlier research shows that the risk-shifting incentive can be eliminated by using a stock-based compensation design to align managers' and stockholders' interests. I show that stock options as well as compensation designs that align managers' and bondholders' interests eliminate the risk-shifting incentive. Although a stock-based compensation design is not a unique mechanism to eliminate the pure risk-shifting incentive, it is essential where managers of levered firms are known to consume a portion of the investment outlay as perquisites.     

REGULATORY ENVIRONMENT AND MARKET RESPONSE TO PUBLIC UTILITY RATE DECISIONS

This paper examines the stock market's response to the public utility rate-case decisions, or settlements, in the context of the regulatory environment. Davidson (1984) finds that the market responds only to “surprise” settlements that are extreme. No adjustment is made, however, for the regulatory environment of the utility requesting a rate increase. The hypothesis of this paper is that a “surprise” is a function of the regulatory environment in which the decision is made. The results of the residual study support the hypotheses that after adjusting for regulatory environment, there is no significant market response to average settlements and above and below average settlements influence the market positively and negatively, respectively.     

‘BIG DATA’, THE ‘INTERNET OF THINGS’ AND THE ‘INTERNET OF SIGNS’

This paper examines the relationship between so‐called ‘Big Data’, the ‘Internet of Things’ (the ‘Internet of People and Things,’ and the ‘Internet of Everything’), and the ‘Internet of Signs.’ In particular, we investigate how the ‘things’ in the ‘Internet of Things’ generate ‘Big Data’, and how both are used to generate semiotic ‘signs’. In addition, we analyse the importance of context in and the relationships between ‘Big Data’, the ‘Internet of Things’, and the ‘Internet of Signs’. Copyright © 2013 John Wiley & Sons, Ltd.