Volkswirtschaft und Volkswirt

Ohne ZusammenfassungAntrittsvorlesung, gehalten im November 1927 an der Universität Wien.     

Dealing with dualities

This paper introduces the topic of dealing with dualities, which is the theme of this special issue. We first give a short review of the notion of paradox and duality in management research. After this, we discuss the relevance of dualities for the IMP approach of analyzing industrial networks. Then, we briefly introduce the papers of and their relationship with the theme of this special issue. We conclude with some suggestions for future research.     

Entry and Innovation in Maturing Markets: Virtual Operators in Mobile Telecommunications

In the last few years the mobile telecommunications industry has witnessed the entry of a large number of new service providers. Traditionally, mobile users get their mobile services from the service providers owned by vertically integrated mobile network operators (MNOs). The new entrants do not own a network of their own however, because they use the existing mobile infrastructure, i.e. they are 'mobile virtual network operators' (MVNOs). By granting these virtual operators access to their networks, MNOs actually facilitate the entry of potential competitors for their own downstream service providers. These new entrants might attract additional users by offering competitive services and create extra value with their well-known brand names and other complementary assets. This study focuses on the mobile market of the Netherlands, where competition is intense and MVNOs proliferate. The aim of this research is to improve our understanding of the entry of virtual operators in general, and specifically by explaining why and how virtual operators enter the mobile market and the impact they have on competition in the mobile market.     

QUALIFIED AUDIT REPORTS,FIELD DEPENDENCE COGNITIVE STYLE,AND THEIR EFFECTS ON DECISION MAKING

This paper reports the findings of an experiment designed to investigate the effects of an unqualified versus an “except for” qualified audit report on subjects' share price estimates and the moderating role of cognitive style in this relationship. Using ANOVA experimental design, 34 subjects were administered identical financial information on a hypothetical company except that 17 subjects received a qualified auditors' opinion and the other 17 received an unqualified auditors' opinion. In addition, the subjects in each group were classified as either field dependent or field independent on the basis of their scores in the Embedded Figures Test. Results showed that the “except for” audit qualification affected share price estimates and field dependence cognitive style interacted with qualified/unqualified audit opinion to also affect subjects' share price estimates.     

The joint information role of analysts’ cash flow and earnings forecasts

We study whether the relative magnitudes of analysts’ cash flow and earnings forecasts convey information about the persistence and value relevance of reported earnings. We find that reported earnings are likely to be more (less) persistent and value relevant when analysts forecast relatively moderate (extreme) levels of operating cash flows, relative to earnings. We also find that the market’s response to a given earnings surprise is the strongest for moderate levels of cash flow forecasts relative to earnings. The joint information role of analysts’ cash flow and earnings forecasts persists even after controlling for the absolute accruals in the model.     

Political connection and cost of debt: Some Malaysian evidence

This paper investigates the association between Malaysian politically connected (PCON) firms and the cost of debt. We extend previous research that finds Malaysian PCON firms are perceived as being of higher risk by the market, and by audit firms, by providing evidence that lenders also perceive these firms as being of higher risk. We also find that PCON firms have a significantly (1) higher extent of leverage, (2) higher likelihood of reporting a loss, (3) higher likelihood of having negative equity, and (4) higher likelihood of being audited by a big audit firm. We suggest that PCON firms are charged higher interest rates by lenders as a result of efficient contracting given their higher inherent risks. Additionally, we find that CEO duality present in PCON firms is perceived by lenders as being more risky, and that a higher proportion of independent directors on the audit committee mitigate this perceived risk.