R&D expenditures and implied equity risk premiums

This study investigates the relationship between research and development (R&D) expenditures and risk premiums implied in the costs of equity capital. We posit that R&D expenditures represent an information risk factor resulting from both information asymmetry about R&D between investors and managers and low-quality R&D reporting that impairs the coordination between investors and managers with respect to managers’ investment decisions. Our results support our position by showing a positive association between R&D expenditures and implied equity risk premiums. From this research along with prior studies, investors can have better knowledge about the risky nature of R&D expenditures that drive up implied risk premiums and at the same time provide opportunities to earn excess returns in a short to long horizon. Accounting standard setters can benefit from this study’s findings that R&D expenditures represent an off-balance-sheet risk factor and thus warrant reconsidering SFAS No. 2 for potential capitalization of R&D expenditures.     

Terrorist economic impact evaluation (TEIE) model: the case of Pakistan

Quality & Quantity - The terrorist economic impact evaluation (TEIE) model is a new model to evaluate the intensity of terrorism to measure the economic cost in a state (province) of any...     

Information technology and its changing roles to economic growth and productivity in Australia

In this paper we describe our investigation of the role of investment in information technology (IT) on economic output and productivity in Australia over a period of about four decades. The framework used in this paper is the aggregate production function, where IT capital is considered as a separate input of production along with non-IT capital and labour. The empirical results from the study indicate the evidence of robust technical progress in the Australian economy in the 1990s. IT capital had a significant impact on output, labour productivity and technical progress in the 1990s. In recent years, however, the contribution of IT capital on output and labour productivity has slowed down. Regaining the IT capital productivity therefore remains as a key challenge for Australia, especially in the context of greater IT investment in the future.     

Earnings Management and Antitrust Investigations: Political Costs Over Business Cycles

This paper examines evidence of earnings management pertaining to regulatory-imposed wealth transfers (i.e., political costs) over business cycles. The sample consists of firms subject to merger-related antitrust investigation under Section 7 of the Clayton Act. Industrial organization literature, together with the political cost hypothesis, suggests that these firms' earnings management incentives may vary over national business cycles. Our results indicate that investigated firms do indeed choose income-decreasing discretionary accruals during expansions but not during recessions, in order to reduce the political costs associated with Clayton Act cases.     

Management control systems in inter-agency collaboration: a case study

This paper explores the nature of management control systems in an inter-agency collaborative arrangement. A Western Australian case study (the PECN project) highlights strategies for successfully providing services to people with highly complex needs, which could not be achieved by siloed attempts by individual agencies. This paper makes a significant contribution by providing evidence on multiple control systems which combine both horizontal and vertical controls to achieve better outcomes. The authors found strong evidence of trust-based relationships among the agencies which appeared to have a positive effect on inter-agency working.     

State vs. market in search of good governance: The case of Sri Lanka telecommunications industry reforms

This research investigates the relationship between the state and the market under independent regulation that accompanied telecommunications‐sector reforms in Sri Lanka. It assesses whether the telecommunications regulator has been functioning in line with market principles. Building on the findings of an exploratory study undertaken for a doctoral degree in 2006–07, the study finds that the regulator has been performing under a plethora of constraints: institutionally, politically, legally, and socially. Institutionally, the regulator is affected by its own internal problems, a lack of capability and capacity, and a complexity created by the other agencies. Politicians have become exceptionally powerful, affecting every function of the regulator. Legal provisions have proven inadequate. Socially, regulatory functions are affected, causing delays. It is important to highlight the fact that these are interconnected; one creates or influences another. The findings suggest that the environment in which the regulator operates affects the credibility and effectiveness of a regulatory framework. The authors, with their extensive expertise, argue that such blockages could be overcome through various measures proposed in the conclusion. © 2010 Wiley Periodicals, Inc.     

A measure of authorship by publications

Measuring publication success of a researcher is a complicated task as publications are often co-authored by multiple authors, and so, it requires comparison of solo publications with joint publications. In this paper, like Price (1981), we argue for an egalitarian perspective in accomplishing this task. More specifically, we justify the need for an ethical perspective in quantifying academic author by identifying certain ethical difficulties of some popular contemporary indices used for this purpose. And then we show that for any given dataset of research papers, the unique method satisfying the ethical notions of identity independence and performance invariance must be the egaliatarian E-index proposed by Bose, Pal, and Sappington (2010) and Price (1981). In our setting, this egalitarian method divides authorship of joint projects equally among authors and sums across all publications of each author.     

Supplier evaluation in the context of circular economy: A forward step for resilient business and environment concern

Resource depletion is a concern for the global economy; many think that available resources on the planet will not be able to cater to an ever-growing population. Thus, economies are trying to become circular, leaving behind the linear tradition linear approach. In the circular economy (CE), physical resources and energy are made to loop back into the supply chain (SC) for a more extended period. Proper selection of suppliers is an essential criterion towards proper execution of the CE principle in SC. In this research, we have constructed a framework for evaluating the supplier concerning the CE implementation. Further, this research identifies the criterion and sub-criterion, which are pertinent for evaluating the supplier in CE context. Fuzzy-based ‘Criteria Importance Through Inter-Criteria Correlation (CRITIC)’ method is justifiably applied to determine the aggregated weights of the criteria. Finally, ‘Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS)’ method is used to determine the suppliers' ranking in the Indian automobile industry. Six criteria and 24 sub-criteria are obtained as per recent literature and then inputs from experts. ‘Environment’ criterion came out as the most favourable criterion with a subjective weight of 0.230. The current research is one of the first such attempts to provide criteria for supplier selection in a CE environment. The developed framework would help organisations in implementing CE-based supplier selection. The identified criteria and sub-criteria would provide organisations with means to evaluate suppliers and help suppliers develop an effective and efficient CE based on the SC.     

Prospect of off-seasonal vegetable production in Bangladesh: a socioeconomic diagnosis

Quality & Quantity - The research work was conducted to estimate comparative profitability, seasonal price variations, and factors affecting the farmers’ decision in the adoption of...