Addressing the Transfer-Pricing Problem in an Origin-Basis X Tax

In a previous paper I described how the tax design called the X Tax would facilitate an international tax system free of many of the complexities and avoidance opportunities plaguing the existing international tax regime and also have neutrality properties generally deemed desirable. A choice must, however, be made between two basic treatments of transborder business transactions—the origin and destination principles. The destination-principle approach sidesteps the need to identify arm's length terms of transborder transactions between related business entities—the transfer-pricing problem. This serious problem remains in the origin-principle approach, which, however, presents fewer challenges of monitoring the flow of goods and services across borders, obviates what I call the tourism problem whereby people can reduce their taxes by consuming in a low-tax jurisdiction and, arguably most important, avoids transition effects associated with introduction of the tax and subsequent tax rate changes that occur in the destination approach. In this paper I explore possible special rules for transborder transactions between related parties in an origin-based system to eliminate the transfer-pricing problem.     

Issues management and organizational accounts: An analysis of corporate responses to accusations of unethical business practices

When external groups accuse a business organization of unethical practices, managers of the accused organization usually offer a communicative response to attempt to protect their organization's public image. Even though many researchers readily concur that analysis of these communicative responses is important to our understanding of business and society conflict, few investigations have focused on developing a theoretical framework for analyzing these communicative strategies used by managers. In addition, research in this area has suffered from a lack of empirical investigation. In this paper we address both of these weaknesses in the existing literature. First, we explicate Impression Management Theory as an appropriate framework for studying organizational communicative responses, paying particular attention to the concept of accounts. Second, we critique previous investigations of organizational accounts and discuss the major contributions of our study. Third, we propose a coding system and content analyze the accounts offered by managers from 21 organizations that were recently the targets of consumer boycotts. Finally, we report the results of our empirical investigation and discuss ethical issues related to organizational accounts. Dennis E. Garrett (Assistant Professor, Division of Marketing, University of Oklahoma) is a co-author of Marketing Theory: Evolution and Evaluation (John Wiley and Sons, 1988). His articles have appeared in Journal of Marketing, Journal of Business Strategies, Business and Society Review, Journal of Marketing Education, and Communication Monographs. In 1987, he was selected as the Outstanding Professor on Campus by the University of Oklahoma Student Association.Jeffrey L. Bradford (Graduate Student, Division of Marketing, University of Oklahoma) is completing his Ph.D. in Marketing in the College of Business Administration. Renee A. Meyers (Assistant Professor, Department of Communication, University of Oklahoma) has published articles in Human Communication Research, Communication Yearbook, Communication Monographs, and Journal of Applied Communication. Her doctoral dissertation from the University of Illinois was selected as the 1987 Outstanding Doctoral Dissertation by the Speech Communication Association.Joy Becker (Graduate Student, Division of Marketing, University of Oklahoma) is completing her M.B.A. degree in the College of Business Administration.     

Real Estate and the Arbitrage Pricing Theory: Macrovariables vs. Derived Factors

Two empirical models are used to implement the arbitrage pricing theory: the factor loading model (FLM) and the macrovariable model (MVM). This study compares the ability of these two models to explain real estate returns using equity REIT returns as a proxy. Two tests are performed: a comparison of crosssectional adjusted-R2's and the Davidson and Mackinnon test. The results show that while the two models perform equally well during the period 1974–1979, the MVM outperforms the FLM over the periods 1980–1985 and 1986–1991. In addition, both models suggest superior financial performance for EREITs relative to other investments in the market during the period 1980–1985.     

Dynamic Correlations Among Asset Classes: REIT and Stock Returns

We use the Dynamic Conditional Correlation model with Generalized Autoregressive Conditional Heteroskedasticity (DCC-GARCH) developed by Engle (Journal of Business & Economic Statistics 20(3):339–350, 2002) to examine dynamics in the correlation of returns between publicly traded REITs and non-REIT stocks. The results suggest that REIT-stock correlations form three distinct periods. During the first period, ending in August 1991 with the start of the modern REIT era, correlations were high and without trend, never dipping below 59%. During the second period, ending in September 2001 with the inclusion of REITs in broad stock market indexes, correlations declined precipitously to 30%, enabling substantially higher portfolio allocations to both high-return asset classes and therefore higher portfolio returns without increasing portfolio volatility. During the third period, since September 2001, correlations increased steadily but only reached 59% in late 2008. A simple portfolio optimization suggests that asset managers would be willing to pay 20 basis points per year, plus the difference in transaction costs, for the ability to use DCC-GARCH modeling of dynamic correlations in place of rolling 24-month asset correlations.     

BUSH'S NEW DEAL

The current US policy of spreading democracy across the globe applies New Deal progressivism to a wider world. Like all government interventions, however, it has unintended consequences and is inefficient. The US should return to a more traditional conception of national security and leave the promotion of democratic principles to the private sector.     

Do Single Mothers Face Greater Constraints to Workforce Participation in Non-Metropolitan Areas?

Increasing workforce participation among single mothers is the primary goal of recent welfare reform measures. This article shows that increased workforce participation in the mid to late 1990s led to improvements in the economic well-being of non-metropolitan and metropolitan area families headed by single mothers. Differential benefits and costs of workforce participation of single mothers in non-metropolitan and metropolitan areas are then examined. Single mothers are found to face lower costs to workforce participation and receive lower hourly earnings in non-metropolitan areas than in metropolitan areas. Young children do, however, raise workforce participation costs more in non-metropolitan areas.     

Generalized cash-flow taxation

We show the unique form that must be taken by a tax system based entirely on realization accounting to implement a uniform capital income tax, or, equivalently, a uniform wealth tax. This system combines elements of an accrual based capital income tax and a traditional cash-flow tax, having many of the attributes of the latter while still imposing a tax burden on marginal capital income. Like the traditional cash-flow tax, this system may be integrated with a tax on labor income. We also show how such a tax can be supplemented with an optional accounting for a segregated subset of actively traded securities, subjected separately to mark-to-market taxation at the uniform capital income tax rate, to permit a fully graduated tax system applicable to labor income.