Is Debt Relief Efficient?

When developing countries announce debt relief agreements under the Brady Plan, their stock markets appreciate by an average of 60% in real dollar terms—a $42 billion increase in shareholder value. There is no significant stock market increase for a control group of countries that do not sign Brady agreements. The stock market appreciations successfully forecast higher future resource transfers, investment, and growth. Since the market capitalization of U.S. commercial banks with developing country loan exposure also rises—by $13 billion—the results suggest that both borrower and lenders can benefit from debt relief when the borrower suffers from debt overhang.     

THE REVENUE‐SHARING RULE FOR INTERCONNECTION CHARGES*

In this paper we explore the economic principle behind the revenue‐sharing rule for interconnection charges. Our main finding is that symmetric firms can collude by splitting the revenues equally. We further characterize the optimal revenue‐sharing ratio and discuss the relationship between optimal ratio and the optimal access price. We also show that the revenue‐sharing rule can have the perverse effect of inducing a firm to raise its own costs in order to gain a higher share of revenues.     

High‐Performance Work System and Organizational Turnover in East and Southeast Asian Countries1

In this paper, we examine the impact of high‐performance work systems (HPWSs) on both voluntary and involuntary organizational turnover rates. Most research on this topic has been done in the United States. Given the global competitive pressures confronting many of the countries of East and Southeast Asia, companies in this region are seeking to become more flexible and often adapt HPWSs practices. We explore the impact of HPWSs in both locally owned companies and subsidiaries of multinational corporations in Korea, Taiwan, Singapore, and Thailand. These countries have significantly different national cultures from the United States and most other Western countries and HPWSs effects in relation to turnover might vary from the studies based in the United States. Our findings are, however, somewhat consistent with U.S.‐based studies. In fact, HPWSs were found to be more effective in reducing turnover in locally owned companies than in subsidiaries of Western and Japanese multinational companies.     

Productivity and Performance Indicators in Enterprise Agreements

The design and implementation of performance measurement systems is a major interest of management accountants. In recent years many organisations have made enterprise agreements with their employees, often specijjing performance indicators on which to base wage increases. This paper explains how performance indicators are used in enterprise agreements and considers alternative definitions of indicators and their limitations. It argues that performance indicators in enterprise agreements should be consistent with wider organisational performance measurement systems, particularly those having a strategic focus.     

UNION EFFECT ON THE USE OF NON‐REGULAR LABOR IN THE REPUBLIC OF KOREA

Our paper aims at analyzing the union effect on the externalization of employment relations, focusing on how labor unions affect management's strategic use of non‐regular labor within the Korean context of industrial relations. Our study presents several interesting implications. Firstly, the unions' motivator role for managerial use of non‐regular labor is more evident than its constrainer role. Secondly, union power exerts a “U‐type” impact on the use of indirect non‐regular labor, while affecting directly employed non‐regular labor in a positive linear way. Thirdly, labor unions in large establishments are more active and influential in representing their members' interests than their counterparts in small establishments with limited financial resources. In particular, the interactive function of the union's power and union leaders' attitudinal inclinations is found to be significant in the negative direction among large establishments.     

Disappearing Dividends: Implications for the Dividend–Price Ratio and Return Predictability

The conventional dividend–price ratio is highly persistent, and the literature reports mixed evidence on its role in predicting stock returns. We argue that the decreasing number of firms with a traditional dividend‐payout policy is responsible for these results, and develop a model in which the long‐run relationship between the dividends and stock price is time varying. An adjusted dividend–price ratio that accounts for the time‐varying long‐run relationship is considerably less persistent. Furthermore, the predictive regression model that employs the adjusted dividend–price ratio as a regressor outperforms the random‐walk model. These results are robust with respect to the firm size.