Growth,governance and corporate payout policy

We show that when growth opportunities decreased following the end of the Cold War, defence firms responded by increasing total payout. This change in policy was largely driven by increased stock buybacks as opposed to changes in cash dividends and primarily by firms that faced stronger external governance. On the other hand, firms with weaker internal governance that were more severely affected by the reduced growth chose to alter the mix of payout at the expense of repurchases. Overall, our findings (i) demonstrate a causal link where exogenous shocks to growth cause payout policy changes, (ii) support the role of internal governance in payout policy design where entrenched managers pre‐commit to higher dividends and (iii) emphasize the monitoring role of external governance in mitigating agency costs of free cash flow.     

Improved estimators in some linear errors-in-variables models in finite samples

The paper uses a Monte Carlo study to demonstrate the dominance under mean squared errors or quadratic loss of a new improved estimator for some linear errors-in-variables models in finite samples. The new estimator is non-linear and biased in a conventional sense and has a smaller risk than the least squares and the Stein estimators. Standard errors for this estimator can be conveniently obtained by bootstrapping methods.     

Formative Feedback through Summative Tutorial-based Assessments: The Relationship to Student Performance

Abstract

This paper investigates the effectiveness (measured using assignment and examination performance) of an assessment design incorporating formative feedback through summative tutorial-based assessments to improve student performance, in a second-year Finance course at an Australian university. Data was collected for students who were enrolled in an undergraduate Finance course and analyzed to ascertain performance improvements. The results indicate that there is a relationship between formative feedback through the use of summative tutorial-based assessments and student performance. Our empirical evidence enriches the extant literature surrounding the effectiveness of formative feedback through summative tutorial-based assessments and fosters an interest in assessment designs that provide formative feedback.     

Analysis of food demand in Vietnam and short‐term impacts of market shocks on quantity and calorie consumption

A complete demand system for Vietnam was estimated using household survey data. Results showed that demand for rice with respect to prices and expenditure is relatively inelastic compared to other foods. Demand for food in general tends to be less elastic at higher levels of income and for urban households. In the short term, a market shock such as a 10% decrease in income or a 30% increase in rice prices forces households to spend a larger portion of their expenditure on rice at the expense of other foods. Low‐income households face a higher risk of undernourishment as their daily calorie intake is more negatively affected by the shocks than high‐income households. The results suggest the importance of policies that provide necessary safety net programs for the poor.     

Causality and wage price inflation in West Germany 1964–1979

Zusammenfassung Kausalit?t und Lohn-Preis-Inflation in Westdeutschland 1964–1979. — In diesem Aufsatz wird ein Vierteljahresmodell der Lohn- und PreisInflation in Westdeutschland (1964 bis 1978) entwickelt. Es verwendet das Konzept der Phillips-Kurve, betont aber die überprüfbare Lohndruck-Hypothese und enth?lt die folgenden sechs Variablen: Konsumentenpreise, Effektivl?hne, Streiks, Tarifl?hne, Nachfrage nach Arbeitskr?ften und die Geldmenge M 1. Mit Hilfe des Konzepts der Wiener-Granger-Kausalit?t und kürzlich entwickelter Methoden der multivariaten Zeitreihenanalyse entsteht ein empirisches Kausalit?tsmodell der Lohn-Preis-Inflation für Westdeutschland. Dieses Modell stützt in starkem Ma\e die Lohndruck-Theorie und weist der Geldversorgung eine unbedeutende Rolle zu. Eine zweiseitige Kausalit?t besteht zwischen den Effektiv- und den Tarifl?hnen, so da\ es unangebracht ist, zeitlich verteilte Lags anzunehmen für die Tarifl?hne in der Lohngleichung oder umgekehrt für die Effektivl?hne in der Gleichung der Tarifl?hne. W?hrend sich als Hauptursache der Lohninflation die Inflationserwartungen und die Tarifl?hne identifizieren lassen, geh?ren zu den wichtigsten Ursachen der Preisinflation die erwarteten Preissteigerungen und die Erh?hung der Kapazit?tsauslastung.

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Résumé Causalité et l’inflation de prix et de salaire en Allemagne de l’Ouest 1964–1979. — Dans cet article l’auteur formule un modèle trimestriel de l’inflation de salaire et de prix pour l’Allemagne de l’Ouest sur la période de 1964.1 à 1978.4. Le modèle utilise les éléments fondamentaux de la courbe de Phillips, mais souligne l’hypothèse testable des déterminants de ?wage-push? et consiste de six variables économiques principales: les prix de consommation, les salaires nominaux, les grèves, les salaires contractuels minimum, la demande de la main-d’oeuvre et les disponibilités monétaires (M1). L’auteur applique le concept de causalité de Wiener-Granger aussi bien que des méthodes des séries chronologiques multivariates développées récemment et obtient un modèle empirique de causalité. Le modèle fortement supporte la théorie de ?wage-push? et révèle un r?le insignifiant des disponibilités monétaires. Une causalité deux-voies peut être observée entre les salaires nominaux et les salaires contractuels minimum. Par conséquent, il n’est pas indiqué de spécifier une structure des décalages retards distribués pour les salaires contractuels dans l’équation de salaire ou, qui est équivalent, pour les salaires nominaux dans l’équation de salaires contractuels minimum. Pendant que l’inflation anticipée et les salaires contractuels sont regardés comme les causes principales de l’inflation de salaire les facteurs décisifs de l’inflation de prix incluent les augmentations des prix attendues et l’augmentation de l’utilisation des capacités.

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Resumen Causalidad e inflation salarios-precios en Alemania Occidental 1964–1979. — En este artícule se formula un modelo trimestral de inflatión de salarios y precios para Alemania Occidental en el período 1964.1 a 1978.4. Este modelo se basa en la racionalidad de la curva de Phillips pero pone enfasis en la hipótesis comprobable de determinantes de presión de salarios y consiste de seis variables económicas importantes: precios al consumidor, salarios monetarios, huelgas, tasas de salarios mínimos negociados, demanda por trabajo y oferta de dinero M1. Usando el concepto de causalidad Wiener-Granger y métodos de series de tiempo multivariables desarrollados recientemente se obtiene un modelo empérico causal de inflatión salarios precios para Alemania Occidental. Este modelo da fuerte apoyo a la teoría de presión de salarios y revela un papel insignificante para la oferta de dinero. Hay una doble causalidad (o de feedback) presente entre salarios monetarios y tasas salariales minimas negociadas y, tomo tal, la práctica de especificar una estructura de rezago distribuida para estas tasas salariales en la ecuación de salarios, o equivalentemente, para salarios monetarios en la ecuación de tasas salariales mínimas negociadas es inapropiada. Mientras que las principales causas de la inflatión salarial se pueden identificar como inflatión anticipada y tasas salariales mínimas negociadas, las principales causas de la inflatión de precios incluyen aumentos de precios esperados y el aumento de la capacidad utilizada.

     

Environmental regulation and MNEs location: Does CSR matter?

We investigate whether firms with relatively low environmental standards are more often located in countries that are poor, corrupt or have weak environmental regulations. We find new empirical evidence in favor of the Pollution Haven Hypothesis, which states that MNEs are transferring their dirty operations to countries with weak environmental regulation. Our findings suggest that these are not necessarily the poorest or most corrupt countries. We establish that MNEs with strong social responsibility avoid locating their operations in countries with weak environmental regulation.