A happy “half way-house”? Medium term inflation targeting in New Zealand

The 2002 Policy Targets Agreement (PTA) between the government and central bank of New Zealand asks the central bank to target inflation “over the medium term” rather than over an annual target. Delegating such a medium term objective to the central bank shifts inflation targeting towards a “halfway-house” between inflation targeting and price level targeting. We show empirically that this helps time consistent policy approximate the first-best commitment policy even when the government asks the central bank to weight output stabilisation differently to society. We estimate the New Zealand economy with a small open economy DSGE model and show that the happiest halfway house is located around a two year averaging horizon at most, which leads to mild improvements in monetary policy efficiency.     

Social and Political Risks: Factors Affecting FDI in China's Mining Sector

Political risk can be defined as the potential for uncertainty and harm to business/economic operations that arise from political (governmental and other) behavior and events. These risks typically stem from factors such as economic structures, government institutions, policies, and societal characteristics, and are becoming more of a concern to prospective investors in a changing global political economy. This article seeks to expand upon the framework of political risk analysis by looking at “softer,” nonquantifiable risk factors. Through the analysis of foreign business experiences in China, we aim to demonstrate, via a qualitative case study of foreign direct investment (FDI) in the Chinese mining sector, that in addition to typical financial, operational, and geological factors, firms should be better aware of the particular sociopolitical and cultural risks that can harm their investments in a given industry. This study draws on primary fieldwork, focuses on micropolitical risks to the industry, and stresses that multinational corporations (MNCs) could be more cognizant of the many societal factors that can influence an investment success. © 2016 Wiley Periodicals, Inc.     

Investor behaviour in response to Australia’s capital gains tax

We calibrate the effect of Australia’s Capital Gains Tax (CGT) on share prices and market activity. Based on a large sample drawn from all listed Australian companies for the years 1994–2007, we find significant tax‐loss selling (TLS) of shares that lost value over the financial year, which is reflected in unusually high trading volume and more sell orders in June and a rebound in July. There is some evidence that small mining stocks are particular targets for TLS. Interestingly, the 1999 CGT reforms, which introduced concessions for long‐term capital gains, did not reduce the incidence of TLS.     

Re-framing a ‘subfusc’ Institute: Building on the past for the future at Chartered Accountants’ Hall, London, 1965–1970

The study which follows traces the circumstances surrounding the rebuilding of Chartered Accountants’ Hall, London, from ca. 1965 to 1970, in order to show how the Institute of Chartered Accountants in England and Wales consciously utilised the architecture of its remodelled headquarters for status-building purposes and for adjusting public perceptions of its role in society. It proceeds by outlining the Hall's prehistory, dealing with the earlier use of architectural effect by the Institute to build its status when Chartered Accountants’ Hall was first built in 1893. Setting the Hall's extension in the context of post-World War II Britain and a rapidly expanding Institute, it details the practicalities associated with the rebuilding; it also outlines the architectural climate of the times and reveals the architect's design ideas and use of architectural metaphors and iconography for status building and related purposes. The study makes clear the role of key individuals within the Institute in forwarding the project, as well as emphasising the unique, creative contribution of the architect. It also offers some refinements to the findings of Macdonald (1989) and McKinstry (1997) concerning the role and use of professional headquarters as status symbols.     

Timing of apology after service failure: the moderating role of future interaction expectation on customer satisfaction

Marketing Letters - When there is a service failure, it is often believed that employees should immediately apologize to customers before hearing their complaints. However, we argue that in certain...     

What Motivates Software Crackers?

Software piracy is a serious problem in the software industry. Software authors and publishing companies lose revenue when pirated software rather than legally purchased software is used. Policy developers are forced to invest time and money into restricting software piracy. Much of the published research literature focuses on software piracy by end-users. However, end-users are only able to copy software once the copy protection has been removed by a ‘cracker’. This research aims to explore why, if copy protection is so difficult to remove, do crackers invest their skill and time in this activity instead of more lucrative and legal employment. This study develops a framework of neutralisation, justification and motivation and goes directly to the initial software crackers to determine what motivates their activities. The study first applies this framework in an anonymous online survey of crackers. The study then conducts cognitive interviews with eight crackers to explore and further validate the survey’s findings. The study finds the challenge of removing the copy protection from software as the strongest motivation for the actions of crackers. Desire for social participation, while found to be rewarding, was considered unnecessary for crackers to continue their actions. Higher social status was not a motivational factor but was a perceived by-product of cracking. The study also raises areas for future research. Dr. Sigi Goode is a senior lecturer in Information Systems at the Australian National University, Canberra and a director of the Australian National Centre for Information Systems Research (NCISR). His PhD thesis dealt with construct validity in IS reserarch. Dr. Goode has published in a variety of journals, including Information & Management, Journal of Global Information Technology Management, Journal of Computer Information Systems, Information Systems Management, Information Technology and Management and the Australian Journal of Information Systems, among others. His research interests include system adoption, mobile commerce, software piracy and open source software. Mr. Sam Cruise has a First Class Honours degree in Information Systems from the Australian National University. Sam has also worked as a project officer for an IT and health research project and recently completed a Graduate Diploma in Education from the University of Western Australia. Sam is currently studying medicine at Griffith University. Sam’s research interests include software piracy and policy, education and information systems use.     

Work absence in industrialised societies: the Australian case

In this paper, Bob Crawford and Sam Volard present an analysis of the causes for temporary non-approved work absence in which they isolate the extent of the ‘sickie’ in Australian industry. They suggest areas in which management can properly institute programmes which are likely to reduce the incidence of this largely avoidable and costly organisational problem.     

Energy in America's future

Energy in America's Future, the book reported on in this article, assembled facts and performed analyses required for making informed energy choices. It reached broad conclusions on supply and demand prospects and on the environmental and other social aspects of policy choices. Although near-term constraints are severely binding, the nation's natural resource position is favorable for long-run supply expansion. Future technologies are also promising in cost terms. Although costs are bound to rise, a ceiling on long-run supply costs looks to be possible at real levels surprisingly close to current prices. Energy consumption in relationship to overall national output (GNP) will be growing at a slower rate than in recent decades. Consumers will use relatively less energy as a result of higher energy prices, conservation incentives, and new energy-using technology. Even so, overall energy use will grow. Major energy demand policy issues concern not just the likely rate of growth of consumption, but also the possible problems connected with optimizing energy efficiency at the expense of economic efficiency (i.e., output in relation to all inputs, particularly those of labor and capital). Environmental impacts and concerns about questions of human health and safety will continue to affect public acceptance of particular energy technologies. The public will need to be adequately informed on the comparative risks of energy supply technologies, and the technical and institutional means available for reducing these risks. The price system must be permitted to function to the maximum feasible extent. In addition, the task for political leadership is to forge a public consensus in support of achievable energy goals. This has been difficult because of conflicting public perceptions of the facts and clashes in social values among different groups. The future prospects for achieving a national energy consensus should be enhanced by the outlook for slower energy demand growth and favorable supply prospects along with potential improvements in the environmental side effects associated with new and improved supply technologies. As knowledge of these changing circumstances becomes more broadly disseminated, the ability to achieve broad public support of energy goals should grow stronger.     

Pricing schemes and market efficiency in private retirement systems

We study the effects of different pricing schemes on the overall surplus in a privately managed retirement system with multiple service providers and switching costs. We develop a theoretical model based on the Chilean retirement system and consider a repeated auction for monopoly rights over new enrollees. We consider a dynamic model solved by pension fund administrators and by consumers. We compare three different pricing schemes: (a) fees on contributions, (b) fees on returns, and (c) a two‐part tariff including an auction over a guaranteed rate of return and allowing the firm to keep a portion of returns generated above this guaranteed rate. We also consider heterogeneity across individuals where agents earn high or low wages and high‐wage customers have proportionally lower switching costs due to more cost‐effective access to financial planning services. We find that auction participants subsidize consumers. We also treat savings as a durable good. In this case, pricing over returns worsens the switching related inefficiencies just described relative to pricing over contributions, despite the better incentives it provides. These inefficiencies can be resolved by allowing firms to price discriminate.