A genetic algorithm approach to detecting temporal patterns indicative of financial statement fraud

This study presents a genetic algorithm approach to detecting financial statement fraud. The study uses a sample comprising a target class of 51 companies accused by the Securities and Exchange Commission of improperly recognizing revenue and a peer class of 339 companies matched on industry and size (revenue). Variables include 76 comparative metrics, based on specific financial metrics and ratios that capture company performance in the context of historical and industry performance, and nine company characteristics. Time-based patterns detected by the genetic algorithm accurately classify 63% of the target class companies and 95% of the peer class companies. Copyright © 2007 John Wiley & Sons, Ltd.     

WELFARE EFFECTS OF DISTORTIONARY FRINGE BENEFITS TAXATION: THE CASE OF EMPLOYER‐PROVIDED CARS*

In Europe, many employees receive company cars as fringe benefits induced by taxation. We analyze the welfare effects of company car taxation for the Netherlands by estimating to what extent car expenditure and private car travel change when employees receive a company car. Tax treatment of company cars generates an annual welfare loss, ranging from €600 to €780 per company car, mainly due to a shift toward more expensive cars (from €420 to €600), but also due to increased private travel (€180). For the whole of Europe, the annual welfare loss is about €12 billion.     

Complexity of Socio-spatial Transformations Through Tourism: A Mediterranean Village,Kaleköy

This article reflects on the complex consequences of tourism development in the isolated Mediterranean village of Kaleko¨y. Built on the antique city of Simena of the 4th century BC and having remnants also from Hellenistic, Byzantine and Ottoman periods, Kaleköy's main source of livelihood since the 1980s has been tourism. Multiple changes that take place simultaneously at the local level, in relation to or as a consequence of tourism, are conceptualised as interrelated transformations that may fall under the four major headings of economy, demography, spatial organisation and cognition. Defining culture as 'everything learned', these transformations amount to a radical change in the local culture, which now includes a culture of tourism. Based on ethnographic research, the article aims to demonstrate the complexity of changes in physical, as well as economic and social structures as they pertain to tourism.     

On existence and stability of spatial equilibria and steady-states

This note discusses the existence and stability of two equilibrium concepts for a spatial economy in which the utility of an agent depends on the overall distribution of agents over space.     

Internet Tool Use and Virtual Co-Creation in the Brazilian Construction Industry: Organizational Practices and Consumers' Personal Values

ABSTRACT

This article analyzes the use of Internet tools and virtual co-creation initiatives of firms ranked among the top 100 in the Brazilian building industry. The research was based on observation of the companies' websites and of 200 posts written by participants in a collaborative building project. Websites were observed for the way online interaction tools were aligned to their declared goals. Posts were analyzed using discourse analysis and coded on the basis of the list of values. Results show that only three companies use online tools for the purpose of co-creation and that customer enjoyment is the primary driver of co-creation.     

Social communication and discrimination: a video experiment

We report on an experiment using video technology to study effects of communication on donations to and discrimination between potential receivers. The experimental design eliminates strategic factors by allowing two receivers to unilaterally communicate with an anonymous dictator before the latter decides on her gifts. Through the use of three communication setups (none, audio, and audio-visual) we analyze purely social effects of communication. A silent video channel leads to discrimination between potential receivers based on impression formation, but does not affect average levels of donations. When the auditory channel is added, average donations increase. The social processes invoked by the visual and audio channels are heterogeneous and communicator-specific but not unsystematic.     

On the Generalized Bootstrap for Sample Surveys with Special Attention to Poisson Sampling

We study the generalized bootstrap technique under general sampling designs. We focus mainly on bootstrap variance estimation but we also investigate the empirical properties of bootstrap confidence intervals obtained using the percentile method. Generalized bootstrap consists of randomly generating bootstrap weights so that the first two (or more) design moments of the sampling error are tracked by the corresponding bootstrap moments. Most bootstrap methods in the literature can be viewed as special cases. We discuss issues such as the choice of the distribution used to generate bootstrap weights, the choice of the number of bootstrap replicates, and the potential occurrence of negative bootstrap weights. We first describe the generalized bootstrap for the linear Horvitz‐Thompson estimator and then consider non‐linear estimators such as those defined through estimating equations. We also develop two ways of bootstrapping the generalized regression estimator of a population total. We study in greater depth the case of Poisson sampling, which is often used to select samples in Price Index surveys conducted by national statistical agencies around the world. For Poisson sampling, we consider a pseudo‐population approach and show that the resulting bootstrap weights capture the first three design moments of the sampling error. A simulation study and an example with real survey data are used to illustrate the theory.     

Procedural justice in managerial performance evaluation: Effects of subjectivity,relationship quality,and voice opportunity

This study investigates the effect of subjectivity in performance evaluation on managerial perceptions of procedural justice. Using survey data from a sample of 317 managers, we examine two forms of subjectivity: use and weight of subjective performance measures and ex post flexibility in the weighting of multiple performance measures. We also examine the interaction effects of two contextual factors, superior–manager relationship quality and voice opportunity, on the association between subjectivity and perceived procedural justice. The results suggest that only the superior's use of ex post flexibility in weighting multiple performance measures adversely affects managers' perceptions of procedural justice. Moreover, superior–manager relationship quality reduces the negative effects of ex post flexibility in weighting multiple performance measures on procedural justice, whereas voice opportunity amplifies this negative effect. These findings have practical and theoretical implications, as they shed new light on the trade-off between the informative benefits and perceived unfairness of incorporating subjectivity into performance evaluation.