THE GOVERNANCE OF PUBLIC ENTERPRISES: THE QUEBEC EXPERIENCE

ABSTRACT ** ** Résumé en fin d'article; Zusammenfassung am Ende des Artikels; resumen al fin del artículo.
: Have public enterprises become obsolete policy instruments? Should they be privatized or can their governance be radically transformed so that they could still be used as policy instruments? The world around them has changed and forced governments to move. After a discussion on the arguments in favour of privatization, this article suggests an analysis of three cases in the Canadian province of Quebec. Considering the pressures linked to the liberalization of trade resulting from NAFTA, this article suggests that the governance of public enterprises can be transformed and adapted and that consequently, it is not useful or necessary to privatize them. There is in reality a lot of room in the public enterprise governance to reform them, room that has been neglected over the last decades.     

An export model for the Belgian industry

A two-equation model for the export volume and the export price of the Belgian industry is specified as a convex combination of demand and supply determinants and estimated using Bayesian inference methods. The results indicate that, in the medium run, industrial exports are mainly explained by the behaviour of price taking suppliers.     

税收竞争还是税收输出?

原载:Journal of Urban Economics,第54卷,(2003)第639-647页一、引言在税收竞争基本模型①里,两个独立辖区政府为了相互竞争流动税基,把税率设计得很低,结果产生了无效率问题。典型税收竞争模型通常研究的是一系列独立辖区,其中每个辖区都在本区范围内对流动资本征税。征来的税款用来支持公共提供品,而这个公共提供品可能具有或不具有公共产品的那些特征。增加税收会带来资本的外流,而这种资本外流是提供公共提供品的一部分成本,尽管如此,我们并不考虑其他辖区拓宽税基这一有益的情况。由于所有辖区政府都采取相同的行为方式,所以,就会出…     

Non-dictatorial extensive social choice

Summary. Different social planners may have different opinions on the well-being of individuals under different social options (Roberts, 1980). If utilities are translation- or ratio-scale measurable, or if the social ranking might be incomplete, or if interplanner comparability is allowed; then there exist non-dictatorial aggregation rules. We propose extensions, intersections, and mixtures of the Pareto, utilitarian, leximin, Kolm-Pollak, and iso-elastic rules.Received: 16 May 2001, Revised: 18 November 2003, JEL Classification Numbers: D63, D71. Correspondence to: Erwin OogheErwin Ooghe, Luc Lauwers: We are extremely grateful to the referee who was willing to review this paper many times. Her/his extensive and in-depth comments had a strong impact. Further thanks are due to Bart Capéau, Marc Fleurbaey, Maurice Salles, Erik Schokkaert, and Alain Trannoy. The first author gratefully acknowledges the financial support by the TMR network Living Standards, Inequality and Taxation (ERBFMRXCT 980248) of the European Communities.     

THE FUTURE OF PUBLIC ENTERPRISES: PERSPECTIVES FROM THE CANADIAN EXPERIENCE

ABSTRACT: Public enterprises have been an integral part of the involvement of the state in the economy for most of the 20th century. After 1980, privatization has been the dominant trend until the 2008–2010 economic crisis when new nationalizations happened. Ownership is only an element of a complex system of relations between a public enterprise and its institutional environment where the role of the board of directors, the mechanisms of coordination, the role of senior civil servants, etc. come to play. Using the Canadian experience with public enterprises, we suggest in this article that public enterprises could be interesting economic policy instruments in the future as in the past if such an economic policy exists. In other words, privatization did not solve the control issue over many large enterprises. Improved corporate governance should be considered. This article aims at improving the understanding of how by focusing on various aspects of the governance of public enterprises on their potential use and work. In Canada, public enterprises have been used to face the recent global crisis but they also come from a long tradition of intervention in the economy, a tradition closer to the European than the American. After reviewing recent developments in their governance, paths for future research are proposed.     

Who Disciplines Management in Poorly Performing Companies?

Economic theory points to five parties disciplining management of poorly performing firms: holders of large share blocks, acquirers of new blocks, bidders in takeovers, nonexecutive directors, and investors during periods of financial distress. This paper reports the first comparative evaluation of the role of these different parties in disciplining management. We find that, in the United Kingdom, most parties, including holders of substantial share blocks, exert little disciplining and that some, for example, inside holders of share blocks and boards dominated by nonexecutive directors, actually impede it. Bidders replace a high proportion of management of companies acquired in takeovers but do not target poorly performing management. In contrast, during periods of financial constraints prompting distressed rights issues and capital restructuring, investors focus control on poorly performing companies. These results stand in contrast to the United States, where there is little evidence of a role for new equity issues but nonexecutive directors and acquirers of share blocks perform a disciplinary function. The different governance outcomes are attributed to differences in minority investor protection in two countries with supposedly similar common law systems. Journal of Economic Literature Classification Number: G3.     

Using Real Activities to Avoid Goodwill Impairment Losses: Evidence and Effect on Future Performance

We examine whether managers postpone the recognition of goodwill impairment by manipulating cash flows and the consequences of such a strategy on future performance. According to SFAS 142, an impairment loss must be recognized if the reporting unit's total fair value to which goodwill has been allocated is less than its book value. A growing body of empirical evidence shows that managers delay the recognition of goodwill impairment in accounting books. However, past literature is silent on how managers convince various gatekeepers (e.g., auditors, financial analysts) that recognizing an impairment loss is unnecessary although it seems economically justified. SFAS 142 requires managers to forecast future cash flows to justify the decision to recognize, or not, an impairment loss. Therefore, we predict that managers manipulate upward current cash flows to support their choice to avoid reporting an impairment loss. We also test whether or not this real earnings management is detrimental to future performance. Based on a sample of US firms over the period 2003–2011, we document that firms suspected of postponing goodwill impairment losses exhibit significantly positive discretionary cash flows compared to various control groups. We also find that this real activities manipulation is detrimental to future performance.     

Shareholder Wealth Effects of European Domestic and Cross‐border Takeover Bids

This paper analyses the short‐term wealth effects of large intra‐European takeover bids. We find announcement effects of 9% for the target firms compared to a statistically significant announcement effect of only 0.7% for the bidders. The type of takeover bid has a large impact on the short‐term wealth effects with hostile takeovers triggering substantially larger price reactions than friendly operations. When a UK firm is involved, the abnormal returns are higher than those of bids involving both a Continental European target and bidder. There is strong evidence that the means of payment in an offer has an impact on the share price. A high market‐to‐book ratio of the target leads to a higher bid premium, but triggers a negative price reaction for the bidding firm. We also investigate whether the predominant reason for takeovers is synergies, agency problems or managerial hubris. Our results suggest that synergies are the prime motivation for bids and that targets and bidders share the wealth gains.