Neural Networks and Empirical Research in Accounting

This article seeks to provide an overview of the potential role of neural network (connectionist) methodology in empirical accounting research. It highlights how the accounting task domain differs substantially from those for which neural network techniques were originally developed. A non-technical overview of neural network methodology is given, along with guidelines to help accounting researchers interested in applying these new tools to recognise the potential dangers and strengths underlying their use. An illustrative example is provided. The paper suggests research areas in accounting where neural network approaches could make a potential contribution. Explicit recommendations for prospective authors are made.     

The relationship between research funding and academic consulting: An empirical investigation in the Spanish context

This paper investigates the relationship between sources of funding for research activity and the engagement of scientists in a specific type of knowledge transfer, that is, academic consulting. We rely on a sample of 2603 individual scientists from five Spanish universities, who have been awarded public funding or have been principal investigators in activities contracted by external agents, over the period 1999–2004. We find that externally contracted research is positively related to the amount of monetary income from consulting contracts, but that international competitive funding has a negative effect. Our results show that this negative effect is positively moderated by the size of contract funding: the effect of international competitive funding becomes positive for moderate and high levels of contract funding. By investigating the relationship between academic consulting and different types of research funding, our paper sheds light on the conditions that favor academic consulting.     

University-level mechanisms supporting the creation of new companies: an analysis of Italian academic spin-offs

In this paper we address the role of university policies in the creation of academic spin-offs. We focus on university technology transfer units (UTTUs) in Italy and on the mechanisms they have implemented to support academic entrepreneurship. We gathered data relating to their strategies for technology transfer and to the mechanisms they had implemented to support new venture creation. Results show that the number of people dedicated to technology transfer activities, strong relationships that UTTUs have with external organisations involved in technology transfer activities, and finally support services provided by universities and UTTUs have a significant influence in fostering the generation of new ventures.     

Half a century of mass tourism: evolution and expectations

This paper presents a retrospective analysis of the service sector focusing on the hotel industry with reference to how internationalisation and globalisation are having a major effect on demand, and as a result how changes must be made to what is offered. The so-called mass tourism must evolve; we are about to enter the second decade of the twenty-first century and mass tourism needs to be transformed. A large number of issues need to be borne in mind, such as the influence technological progress is having on the ways of travelling and booking and on sustainable, environmental tourism. Also to be taken into account is the competitiveness of the so-called emerging nations, for which a mature country like ours can provide new tourist packages.     

Layout problem for an aircraft maintenance company tool room

A tool room of an aircraft maintainance company with 10000 tools is considered. These tools are borrowed by the mechanics when needed and must be returned before the end of shift. About 400 in-out transactions are handled by the storekeepers of the room. However, since the room is usually crowded with mechanics at their shift start/end times, the storekeepers are overloaded and significant productive manpower is held up in waiting for the tools. Therefore, the racks and tools in the tool room are required to be rearranged so that the handling time of the in/out transactions can be reduced.The racks are rearranged by heuristics and then tools are allocated to the racks according to request probabilities, which are estimated by the proportion of each tool's on-loan frequency to the total on-load frequency during December 1992. Effectiveness is measured by comparing the total rectilinear distance travelled to fetch the tools requested during 11–15 January 1993 based on the proposed changes, to that based on existing rack and tool arrangement. It was found that improvement by tool allocation according to the request probabilities could reach up to 39% with the existing rack arrangement. Furthermore, minor rearrangement on the racks could also reduce the distance travelled by 12%.     

The relative importance of time and dollar values in new product introduction decisions

This study investigates managerial sensitivity to timing differences in new product introduction decisions. Using a case scenario as the research setting, the study finds that in managerial decisions involving a choice between two-attribute alternatives (dollar value and time), respondents shifted their emphasis between attributes when they were personally affected by the decision outcome. Specifically, it was found that an additive constant manipulation (adding a constant to the dollar amount of each alternative) caused respondents to place more emphasis on the time attribute, and a multiplicative constant manipulation (multiplying the dollar amount of each alternative by a constant) caused them to place more emphasis on the dollar-value attribute.The study asks 108 subjects to assume the role of product manager in a case scenario and choose from among three two-attribute alternatives proposed by the case. The personal relevance of the decision was manipulated by telling respondents that the CEO in the decision scenario had stated publicly that the career of the decision maker would be (would not be) affected. The results show that the additive constant and multiplicative constant effects were only found when the decision outcomes would affect the respondents' career.     

Identification of consumers’ preferences when their choices are unobservable

Summary. We provide conditions under which the heterogenous, deterministic preferences of consumers in a pure exchange economy can be identified from the equilibrium manifold of the economy. We extend those conditions to consider exchange economies, with two commodities, where consumers preferences are random. For the latter, we provide conditions under which consumers heterogenous random preferences can be identified from the joint distribution of equilibrium prices and endowments. The results can be applied to infer consumers preferences when their demands are unobservable.Received: 8 May 2003, Revised: 14 September 2004, JEL Classification Numbers: D12, D51.I am very grateful to an anonymous referee, Donald Brown, and Daniel McFadden for their detailed comments and insightful suggestions. Section 2 of this paper is joint work with Donald J. Brown; it is included here for publication with his permission. Those results were presented at the 1990 Workshop on Mathematical Economics at the University of Bonn, the 1992 SITE Workshop on Empirical Implications of General Equilibrium Models at Stanford University, and, more recently, at the June 2000 Conference in Honor of Rolf Mantel, in Buenos Aires, Argentina. The comments of the participants at those conferences and workshops are much appreciated. The research presented in this paper was supported by NSF Grants SES-8900291, SBR-9410182, and SES-0241858. This paper is dedicated to Marcel K. Richter, who has inspired much of my research.     

Equilibrium implications of interest rate smoothing

We introduce a macro-finance model in which monetary authorities adjust the money supply by targeting not only output and inflation but also the slope of the yield curve. We study the impact of McCallum-type rules on capital growth, the volatility of interest rates, the spread between long- and short-term rates, and the persistence of monetary shocks. Our model supports the Federal Reserve's choice to incorporate financial data in their policy decisions and expand the monetary base to decrease the nominal interest rate spread at the cost of lower expected long-term growth.     

Evidence on the effect of ‘Claw-Back’ provisions on IPO share allocation and underpricing in Hong Kong

The article examines share allocation practices of over 300 initial public offerings (IPOs) in Hong Kong during the years immediately following the enacting of a ‘Claw-Back’ provision for IPO share reallocation. The examination of exhaustive micro-level data reveals that small (uninformed, retail) investors earn higher initial returns than large investors. Before the enacting of the ‘Claw-Back’ provision, small investors were unfavourably treated in relation to large investors. The pattern now prevailing in the proportion of shares allocated to small and large investors also differs from that observed previously. When attempting to isolate the determinants of IPO underpricing in Hong Kong, the article also shows that both the ‘informed demand’ hypothesis and the signalling effect of underwriters’ reputation are significant determinants of underpricing. Such result, not visible when pooled OLS regressions are used, becomes apparent through the use of a system of simultaneous equations.