Environmental accounting: an essential component of business strategy

Environmental accounting is on an expansion path. With increasing social focus on the environment, accounting fills an expectation role, to measure environmental performance. The status of environmental awareness provides a dynamic for business reporting its environmental performance. Examining the integration of environmental policy with business policy is the focus of this research. The business firm's strategy includes responding to capital and operating costs of pollution control equipment. This is caused by increasing public concerns over environmental issues, and by a recent government‐led trend to incentive‐based regulation. This paper describes the environmental component of the business strategy, producing the required performance reports and recognizing the multiple skills required to measure, compile and analyze the requisite data. Special emphasis of the research is on generation of reports and their standards, for the range of business and regulatory purposes. Copyright © 2004 John Wiley & Sons, Ltd and ERP Environment.     

Characteristics Associated with the Corporate Decision to Adopt Long‐term Performance Plans

This study investigates why firms adopt long‐term performance plans. The results provide evidence that firms that adopt long‐term performance plans have higher risk as measured by Beta, have lower percentages of managerial stockholdings, have higher levels of investment in research and development expenditures two years prior to adoption of a long‐term performance plan, and experience increases in the ratio of debt to total assets in the two year period prior to long‐term performance plan adoption. Also, firms increase their investments in research and development and capital expenditures following adoption of long‐term performance plans.     

The Application of Multivariate Stochastic Dominance Criteria to Agricultural Economic Problems

This paper provides a discussion of multivariate risk analysis and multivariate stochastic dominance criteria. The assumptions and conditions required to extend the use of stochastic dominance criteria to multivariate problems are examined. The assumptions of additive utility or statistical independence are required to apply true multivariate stochastic dominance criteria. Implications for the application of several multivariate stochastic dominance criteria to empirical problems are discussed. An empirical application is presented to demonstrate the importance of recognizing the assumptions underlying alternative multivariate stochastic dominance criteria. Alternative structural adjustments for a representative upper midwestern dairy farm are examined and assessed using multivariate stochastic dominance. The results of the analysis indicate that, if utility is assumed to be additive, dairy expansion and specialization may not be optimal. If utility is assumed to be defined in terms of overall wealth, however, dairy expansion and specialization are preferred to the present firm structure. Cet article analyse le risque des variables aléatoires multiples et les critères de prédominance des variables aléatoires stochastiques multiples. Les suppositions et les conditions requises pour étendre l'usage des critères de prédominance stochastiques aux variables aléatoires multiples sont étudiées. Les suppositions d'utilité additive ou d'indépendance statistique sont exigées pour appliquer les critères de prédominance des variables aléatoires stochastiques multiples. L'étude examine également les implications de l'application de plusieurs critères de prédominance des variables aléatoires stochastiques multiples sur des problèmes empiriques. Une application empirique est utilisée pour démontrer qu'il important de reconnaître les suppositions qui sont à la base des critères alternatifs de prédominance des variables aléatoires stochastiques multiples. Les variables aléatoires multiples de prédominance stochastique sont utilisées pour examiner et évaluer des ajustements structurels alternatifs pour une ferme laitière representative du haut-midwest. Les résultats de l'analyse indiquent que, dans les conditions d'utilityé additive, l'expansion et la spécialisation des fermes laitières pourraient ne pas être optimales. Par contre si l'utilityé est défine en termes de fortune, l'expansion et la spécialisation laitiéres sont préferables à la structure actuelle des fermes.     

The Effects of the Tax Cuts and Jobs Act of 2017 on Defined Benefit Pension Contributions*

This study examines the effect of the Tax Cuts and Jobs Act of 2017 (TCJA) on corporate defined benefit pension contributions. The TCJA decreases the corporate tax rate from 35 percent in 2017 to 21 percent in 2018 and thereafter. This change incentivizes firms to increase 2017 pension contributions to take advantage of tax deductions at a higher rate. Consistent with this incentive, we find firms increase defined benefit pension contributions by an average of 25 to 31 percent in 2017 compared with earlier years. We also find that taxpaying firms are the primary contributors. Further, taxpaying firms with high levels of pension-related deferred tax assets contribute over three times as much as taxpaying firms with low levels of pension-related deferred tax assets. We also find firms that increase pension contributions in 2017 reduce 2018 contributions, consistent with intertemporal income shifting rather than a permanent change in pension funding strategy.     

Ethical tension points in whistleblowing

This paper analyzes the number of procedural and substantive tension points with which a conscientious whistleblower struggles. Included in the former are such questions as: (1) Am I properly depicting the seriousness of the problem? (2) Have I secured the information properly, analyzed it appropriately, and presented it fairly? (3) Are my motives appropriate? (4) Have I tried fully enough to have the problem corrected within the organization? (5) Should I blow the whistle while still a member of the organization or after having left it? (6) Should I keep anonymity? (7) How ethical is it to assume the role of a judge? (8) How ethical is it to set in motion an act which will likely be very costly to many people? Substantive tension points include such questions as: (1) How fully am I living up to my moral obligations to my organization and my colleagues? (2) Am I appropriately upholding the ethical standards of my profession? (3) How adversely will my action affect my family and other primary groups? (4) Am I being true to myself? (5) How will my action affect the health of such basic values as freedom of expression, independent judgment, courage, fairness, cooperativeness, and loyalty?     

Reciprocity, Trust, and Payoff Privacy in Extensive Form Bargaining

We report decision making in two-person extensive form game trees, using six treatments that vary matching protocol, payoffs, and payoff information. Our objective is to examine game theoretic hypotheses of decision making based on dominance and backward induction in comparison with the culturally or biologically derived hypothesis that reciprocity supports more cooperation than predicted by game theory. We find strong support for cooperation under complete information, even in single-play treatments and in games of trust, unreinforced by the prospect of punishment for defection from reciprocity. Only under private information do we observe strong support for noncooperative game theory.Journal of Economic LiteratureClassification Numbers: C78, C92.     

Scale Externalities in Korea

This paper estimates the nature and magnitude of scale externalities in a developing country, Korea, in the period 1983–1993. This is a period of rapid industry deconcentration from Seoul to other metro areas, providing a context where externalities are measured when local scale magnitudes are changing dramatically. The data allow us to examine the emerging degree of national industrial concentration in different industries, as related to their scale externality magnitudes. We also examine whether individual industries agglomerate in cities which have a comparative advantage for that industry.