Sustainability accounting for companies: Catchphrase or decision support for business leaders?

“Sustainability accounting” and related terms are being used with greater frequency at academic conferences and in corporate practice. This raises the question of the relationship between accounting and sustainability and the role of accounting for sustainability, as well as what could be understood by sustainability accounting. The paper reviews the literature on sustainability accounting from an information management perspective and distinguishes different interpretations of sustainability accounting.     

Political Connectedness and Firm Performance: Evidence from Germany

Abstract. This paper investigates politically connected firms in Germany. With the introduction of a new transparency law in 2007, information on additional income sources for all members of the German parliament became publicly available. We find that members of the conservative party (CDU/CSU) and the liberal party (FDP) are more likely to work for firms than members of left‐wing parties (SPD and The Left) or the green party (Alliance 90/The Greens). Politically connected firms are larger, less risky and have lower market valuations than unconnected firms. They also have fewer growth opportunities, but slightly better accounting performance. On the stock market, connected firms significantly outperformed unconnected firms in 2006, i.e. before the publication of the data on political connections. Differences in stock market performance were much smaller in 2007.     

A new framework for fiscal policy consolidation in Europe

Current developments in Greece make clear that the rules of the European Stability and Growth Pact (SGP) were neither strict enough nor enforced strictly enough. To deal with the ongoing exit from the fiscal crisis and its related phenomena, we propose a new framework for fiscal policy consolidation in Europe. The centrepiece is a European Consolidation Pact to supplement the SGP which would supply loan guarantees in exchange for a fee and stricter budget consolidation measures. The new framework also spells out the details of an orderly government default.     

Mandatory sick pay provision: A labor market experiment

The question whether a minimum rate of sick pay should be mandated is much debated. We study the effects of this kind of intervention with student subjects in an experimental laboratory setting rich enough to allow for moral hazard, adverse selection, and crowding out of good intentions. Both wages and replacement rates offered by competing employers are reciprocated by workers. However, replacement rates are only reciprocated as long as no minimum level is mandated. Although we observe adverse selection when workers have different exogenous probabilities for being absent from work, this does not lead to a market breakdown. In our experiment, mandating replacement rates actually leads to a higher voluntary provision of replacement rates by employers.     

A Service Perspective on IBM’s Brand

Today, global conditions challenge traditional views of management, marketing, and economics. The goods-dominant view, centered on the notion of production and consumption, is being subsumed by the service-dominant view, centered on the notion that business value is cocreated by interaction of economic entities. Here, we consider IBM and its brand, showing that it reflects - and always has reflected — the service-dominant view of value cocreation.     

Dynamic effects of public investment: Vector autoregressive evidence from six industrialized countries

We analyze the dynamic relationship between public investment and output. Whereas existing empirical studies on the effects of public capital typically rely on single-equation models of the private sector, we investigate the role of public investment in an economy by examining impulse responses derived from vector autoregressions. Using data from six industrial countries, we specifically examine the following questions: does higher public investment lead to GDP increases; is there reverse causation from output to public investment; and what are the effects of expenditure-neutral budget shifts from public consumption to public investment. First version received: April 1999/Final version accepted: August 2000     

A high-low-based omnibus test for symmetry, the Lévy property, and other hypotheses on intraday returns

We consider different models for intraday log-returns: Lévy models, symmetric models, and Lévy processes subjected to independent continuous time-changes. For these models, we show bivariate interchangeability of intraday up- and downside volatility ratios which are built using daily high-low prices. Using conditional inference permutation tests on bivariate interchangeability, we develop an omnibus test for the above-mentioned models. Empirically, we find strong evidence against intraday returns belonging to these model classes, as we reject bivariate interchangeability of the volatility ratios for half of the components of the DJIA, two thirds of the S&P 500 shares and almost all stocks of the German DAX.     

Structural Determinants of Job Satisfaction and Organizational Commitment in Turnover Models

Using Meta-Analytical Structural Equation Modeling (SEM), the relationships between structural determinants of job satisfaction and organizational commitment were investigated in the context of contemporary turnover models. Data for this study were obtained from nine empirical studies conducted under the direction of James L. Price and Charles W. Mueller at the University of Iowa. The results suggest that only three structural determinants (distributive justice, promotional chances, and supervisory support) are directly related to organizational commitment over and above their impact on job satisfaction. The effect size of these direct links, however, is small in that they are not detectable in smaller samples (e.g., n=244). On the other hand, most structural determinants are directly related to job satisfaction. The notable exception is the amount of pay employees received which is not related to either job satisfaction or organizational commitment. These findings and implications for future turnover research are discussed.     

The hidden costs of outsourcing: evidence from patent data

Drawing on patent data for approximately 500 firms over 20 years, we advance recent theory on firm boundaries and test these propositions for the first time. We first provide evidence for the existence of knowledge complementarities between vertically related activities in a firm's value chain by showing that firms face increasing (decreasing) performance in conducting downstream activities (i.e., patent litigation) the less (more) they outsource related upstream activities (i.e., patent filing). We then propose and empirically demonstrate that vertical integration benefits through learning differ from vertical outsourcing costs through forgetting. We show that firms can partly offset these hidden outsourcing costs by sourcing similar upstream products from internal and external suppliers. Copyright © 2010 John Wiley & Sons, Ltd.