Explaining Underutilization of Tax Depreciation Deductions: Empirical Evidence from Norway

Many corporations do not claim all of their allowable tax depreciation deductions. Intuitively, this kind of behavior might seem odd. However we propose several possible explanations. First, we find strong evidence that firms facing current tax losses or carrying forward past losses underutilize depreciation in order to recover tax losses before they expire. Second, corporations with bad economic performance tend to underutilize their deductions, suggesting that corporations use costly windowdressing on their accounting measures. Third, we find support for the hypothesis that tax compliance costs discourage the utilization of accelerated depreciation, especially by small firms. We do not find much support for other hypotheses. For example, we find no evidence of substitution between tax depreciation and private debt due to competition between the benefits of private bank monitoring and the tax savings from using tax allowances to postpone tax payments, as suggested in earlier literature. We also study the effects of the uniform reporting accounting system (typical of many European countries) which can, under certain circumstances, constrain dividends. Forgoing some tax depreciation can loosen the dividend constraint, but the evidence does not support this motivation. Unusual access to extremely detailed individual firm tax return forms in Norway made our empirical analysis possible. In addition, the 1992 Norwegian tax reform provided a natural experiment for testing some of the hypotheses. We use the time-series and cross-sectional variation across Norwegian corporations in 1988, 1991, 1992 and 1993.     

Automobile Usage in a Future Information Society

The Information society provides a challenge for the future of the automobile. This article, based on a two-year Swedish study as part of the MIT Future of the Automobile Programme, used four scenarios against which to predict the future of the car in Sweden. It concludes that, overall, information technologies will not substitute for travel, only for the information carried on paper; rather, future moves towards increasingly dispersed living will keep car usage high.     

Failures to enact the future—A social practice perspective

To be successful, organisational foresight requires a multitude of perspectives and faculties. We have adopted a social practice perspective, which we base within an interpretative world view, to better understand how organisational foresight is enacted. This offers a reading of the phenomena, of which the essential contribution is that organisational foresight is more than an organisational property; it is something that reflective people do as they engage with various inputs from the outside and as a result of the continuous interaction between activity systems and their constituting elements. A longitudinal case study illustrates the importance of understanding the construction of collective and individual meaning in working with organisational foresight. The study shows how the inherent rigidity of the existing activity system and the weak ties between these diverse subsets of the organisation may block the interaction between emerging social practices and organisational intentions resulting in ongoing failures of understanding and enactment. A model is developed to include these parameters in an augmented activity systems model. Based on this we have identified the linking of organisational levels as one of the key dimensions to be considered for which the social practice perspective holds significant explanatory strength.     

Privacy at Work – Ethical Criteria

New technologies and practices, such as drug testing, genetic testing, and electronic surveillance infringe upon the privacy of workers on workplaces. We argue that employees have a prima facie right to privacy, but this right can be overridden by competing moral principles that follow, explicitly or implicitly, from the contract of employment. We propose a set of criteria for when intrusions into an employee's privacy are justified. Three types of justification are specified, namely those that refer to the employer's interests, to the interests of the employee her- or himself, and to the interests of third parties such as customers and fellow workers. For each of these three types, sub-criteria are proposed that can be used to determine whether a particular infringement into an employee's privacy is morally justified or not.