AN EMPIRICAL NOTE ON CRITICAL COMMENTARY IN AUSTRALIAN ECONOMICS JOURNALS

A substantial empirical literature exists on ranking the published research output of individual academic economists and individual university Economics departments, including Australian work in Economics. However, very little corresponding effort has been directed at examining trends in the nature of published articles, and this embryonic literature is exclusively focused on a handful of top-ranked journals to the exclusion of Australian Economics journals. This note seeks to fill this gap by adopting the methodology developed by Coelho et al. (2005) in their analysis of the decline in critical commentary and applying it to Australian Economics journals for the period 1962 to 2005.     

Methodological Issues in Cross-Sectional and Panel Estimates of the Human Resource-Firm Performance Link

Because companies differ in factors such as management ability that may lead to both high performance work systems and enhanced firm performance, conventional estimates of the effects of human resource (HR) management practices on firm performance may be biased upward. Alternatively, if HR management practices are measured with error, estimates of their effects on firm performance may be biased downward. We find that although longitudinal estimates that avoid the first source of bias are substantially smaller than cross-sectional estimates, the former are strongly influenced by errors in measuring HR management practices. Based on independent estimates of the measurement error, we calculate a range of estimates that correct for both biases. We estimate that a one standard deviation increase in our measure of high performance work systems raises the market value of the corporation by approximately $15,000 per employee.     

How Do Experienced Users Evaluate Hybrid Financial Instruments?

Hybrid financial instruments contain features of both liabilities and equity. Standard setters continue to struggle with “getting the classification right” for these complex instruments. In this paper, we experimentally test whether the features of hybrid instruments affect the credit‐related judgments of experienced finance professionals, even when the hybrid instruments are already classified as liabilities or equity. Our results suggest that getting the classification right is not of primary importance for these experienced users, as they largely rely on the underlying features of the instrument to make their judgments. A second experiment shows that experienced users’ reliance on features generalizes to several features that often characterize hybrid instruments. However, we also find that experienced users vary in their beliefs about which individual features are most important in distinguishing between liabilities and equity. Together, our results highlight the importance of effective disclosure of hybrid instruments’ features.