Shared savings, shared risk: first-year potential gains and losses of ACOs

As hospitals prepare for a new world of shared payments under the ACO model, they need to make determinations with respect to four key areas of concern: Integration--whether the organization can realistically deliver all that is required for shared savings. Cost versus benefits--whether the benefits of becoming an ACO exceed the costs. Patient loyalty--whether their patient population is sufficiently loyal to help ensure the organization will succeed as an ACO. Risks versus rewards--which option among ACO models is most financially attractive based on an analysis of the particular data sets.     

The use of options theory to value research in the service sector

This paper examines the practicalities of applying real options theory to valuing research in the service sector, where the relationship between research and subsequent business benefit is less easily discerned than in most previous applications of options theory in, e.g. the pharmaceutical industry. The paper uses a compound options model, the Geske model, based on a three‐phase lifecycle consisting of research, development and deployment. This model was applied in a case study within the e‐commerce area to extract key messages for R&D managers relating to different value drivers. However, the case study emphasized the need to understand the relationship between the research activity and the subsequent revenue stream, and to be able to demonstrate the extent to which the former is necessary for the latter.     

Retirement in Australia: A Closer Look at the Financial Incentives

In Australia, labour force participation among older people has been declining. Previous research has found that in many OECD countries, the retirement income system actually provides a financial incentive for older workers to retire early. In this article, we model the retirement behaviour of Australian men and women aged between 55 and 70 years, where individuals retire in the period that the present value of their lifetime retirement income is maximised. Our findings suggest that the Australian retirement system does provide an incentive to retire early. However, men are much more likely than women to respond to these financial incentives.     

Business Ethics Training: Face-to-face and at a Distance

An 11-week hybrid distance learning/personal contact ethics training program, customized for a leading information technology firm, is described in the format of a sequential process. The process is grounded on discourse ethics and the ethics training guidelines premised by the Hastings Institute. Indications from the firm and from the program’s participants are that the training has been beneficial. Warren French is the Cousins Professor of Business Ethics at the Terry College of Business, University of Georgia. He also serves as a visiting faculty member at the Universite Jean Moulin Lyon III where he teaches business ethics. His research area is conflict resolution through discourse ethics.     

Emotional Intelligence and Venture Performance

Scholars emphasize the importance of emotion in entrepreneurship and the potential of emotional intelligence, but research is sparse in the field. We develop and test a novel partial mediation model of emotional intelligence, interpersonal processes, and venture performance. The results indicate that interpersonal emotional skills, which entail the recognition and management of emotions in others, has a direct effect on venture performance, but intrapersonal emotional skills pertaining to self‐awareness and regulation of emotions do not. Additionally, both the intrapersonal and interpersonal dimensions of emotional intelligence have an indirect influence on firm performance via interpersonal processes that entail functioning in key activities within the firm. We discuss the implications and address potential avenues for future research on this important topic.     

Banks, Bears, and the Financial Crisis

We test whether short selling is destabilizing comparing distressed financial firms to other firms using NYSE transactions records covering 4 years including the recent financial crisis. Aggressive short-selling is sometimes destabilizing by some measures, but its impact is small, vanishes quickly, is not necessarily larger for distressed firms or during the crisis, and is accompanied by other stabilizing effects. The evidence does not validate theoretical predictions from models of destabilizing speculative or predatory trading. Aggregate short-selling is largely unrelated to market-wide investor sentiment, credit risk, and ex ante volatility. Aggressive liquidation of long positions typically has more impact than short selling. Thus, the data cannot justify the restrictions on short sales of financial stocks imposed in September 2008.     

Deriving utilities using the analytic hierarchy process

The analytic hierarchy process is used to derive the utilities of outcomes in a decision problem. Such utilities may be verifiable or adjusted by the familiar standard gamble procedure. For multiattribute outcomes, the methodology may be easier to employ than scoring rule procedures.     

Asymmetry in return and volatility spillover between equity and bond markets in Australia

We document asymmetry in return and volatility spillover between equity and bond markets in Australia for daily returns during the period 1992–2006 using a bivariate GARCH modelling approach. Negative bond market returns spillover into lower stock market returns whereas good news originating in the equity market leads to lower bond returns. Bond market volatility spills over into the equity market but the reverse is not true. Transmission of bond volatility into equity volatility depends in a complex way upon the respective signs of the return shocks in each market.     

Personal Reflections on Ten Years of the IASB

The International Accounting Standard Board's first 10 years were, in many ways, tumultuous. Established initially as a type of accounting ‘think tank’ with a mandate to develop high‐quality accounting standards that could be adopted on a voluntary basis by countries around the world, it soon gained an international constituency that thrust it into the hurly burly of international accounting standard setting. Before it knew it, the Board was faced with not only resolving challenging technical issues but also dealing with the politics and other pressures that accompany attempts to change accounting practices in highly controversial areas. This article is a personal reflection on the Board's journey from its inception in 2001 until 2011, when the last of the initial board appointees, including the author, retired from the Board. The article indentifies and discusses some of the critical events that took place, including the impact of some of the events on the people directly involved.