The role of accounting disaggregation in detecting and mitigating earnings management

Though ample empirical evidence alludes to the importance of disaggregated accounting data in the context of earnings management, extant theory considers biases in reporting mostly at the aggregated level of the accounting report. By introducing accounting disaggregation into the conventional theoretical framework of earnings management, this study highlights the essential role that disaggregated accounting data play in detecting and mitigating reporting manipulations. Disaggregated reports are shown to be especially effective when they consist of accounting items that are tightly interrelated by their fundamental economic nature, differ considerably in their sensitivity to reporting manipulations, and vary in their signs.     

新疆土地利用型荒漠化及其防治措施

新疆极为干旱少雨，生态环境脆弱，滥垦，滥挖，乱占导致了生态平衡失调，耕地质量越来越差，森林，草地破坏规模大，沙漠化威胁越来越大。土地资源正受着自然因素和人为因素的双重压力。因此，制定适当的规划，合理开发利用土地资源，是推进新疆生态环境保护和建设，实现社会经济可持续发展的需要，分析了新疆土地利用型荒漠化的分类及存在的问题，并提出了防治措施。     

Framing the Allais paradox as a daily farm decision problem: tests and explanations

The well-known Allais paradox is reformulated as a daily farm decision problem. Only 26% of the farmers exhibit violations of the expected utility hypothesis. Moreover, the tendency for violation decreases with the farm operator's education, experience and family size. No effects of the farm main crop or its scale were detected. Finally, when taking into account the possibility of choice errors, we find that the violation rate is statistically insignificant.     

Recycled Effluent: Should the Polluter Pay?

A coastal city can either dispose of recycled effluent by dumping it in the sea, or transfer it to farmers in its hinterland for irrigation. Who should bear the cost of recycling? Three alternatives are employed: a central planner who maximizes the combined utility of city and farmers; regulation by prices, for which purpose we develop the city's supply function; and a bargaining framework for the allocation of costs. The main conclusions are that "the polluter pays" rule cannot be justified in principle and that bargaining may result in inefficiency. We demonstrate with an example from Israel that essentially conforms to the theoretical structure.     

The WTO deal on basic telecommunications : Big bang or little whimper?

It has been widely asserted that the Group on Basic Telecommunications (GBT) agreement reached in February 1997 is a significant step forward for the cause of global telecommunications liberalization. This article brings together two authors on different sides of the needed debate about the potential impact of the GBT deal. Following a brief introduction, William Drake argues that the GBT deal could, depending on its implementation, have a substantial liberalizing effect not only on specific markets, but also on the broader institutional arrangements of the global telecommunications policy environment. In response, Eli Noam argues that the GBT is useful, but that its significance is being greatly exaggerated, that most policy changes were taking place anyway, and that it could in some cases have the negative effect of slowing down the process of global liberalization.     

Momentum in Residential Real Estate

This paper examines whether there is return momentum in residential real estate in the U.S. Case and Shiller (American economic review 79(1):128–137, 1989) document evidence of positive return correlation in four U.S. cities. Similar to Jegadeesh and Titman’s (Journal of finance 56:699–720, 1993) stock market momentum paper, we construct long-short zero cost investment portfolios from more than 380 metropolitan areas based on their lagged returns. Our results show that momentum of returns in the U.S. residential housing is statistically significant and economically meaningful during our 1983 to 2008 sample period. On average, zero cost investment portfolios that buy past winning housing markets and short sell past losing markets earn up to 8.92% annually. Our results are robust to different sub-periods and more pronounced in the Northeast and West regions. While zero cost portfolios of residential real estate indices is not a tradable strategy, the implications of our results can be useful for builders, potential home owners, mortgage originators and traders of real estate options.     

Taking Stock: Equity-Based Compensation and the Evolution of Managerial Ownership

We investigate the impact of stock-based compensation on managerial ownership. We find that equity compensation succeeds in increasing incentives of lower-ownership managers, but higher-ownership managers negate much of its impact by selling previously owned shares. When executives exercise options to acquire stock, nearly all of the shares are sold. Our results illuminate dynamic aspects of managerial ownership arising from divergent goals of boards of directors, who use equity compensation for incentives, and managers, who respond by selling shares for diversification. The findings cast doubt on the frequent and important theoretical assumption that managers cannot hedge the risks of these awards.