The future of olive groves on sloping land and ex-ante assessment of cross compliance for erosion control

Under the past Common Agricultural Policy (CAP) olive oil subsidy regime, farmers were eligible for subsidies on the basis of the amount of olive oil they produced. This led to an intensification of production, particularly on flat land, and had in most cases negative environmental effects, such as more soil erosion on sloping land and more pollution. With the decoupling of agricultural support under the newly established rules of the CAP, formalised in 2005, cross compliance measures have become obligatory.In this paper an ex-ante assessment is made of the application of cross compliance for soil erosion control (natural cover crops and terrace maintenance) in hilly and mountainous olive groves in Trás-os-Montes in Portugal. A linear programming model was developed to assess the various socio-economic and environmental effects of four different development scenarios for olive groves. The scenarios were developed on the basis of changing market prices, wage rates and subsidies; their effects included shifts towards intensification, abandonment and organic farming. Simulations considering a minimum return to labour constraint showed very high levels of abandonment, particularly in combination with cross compliance obligations. However, even without this minimum return to labour constraint, abandonment would reach more than 20% in three out of the four scenarios. The model showed that cross compliance obligations could be quite effective in reducing erosion, but that they would depress income in all scenarios as a result of higher abandonment and lower percentage shifts towards intensive systems.     

Technology transfer in Mexico: Past patterns and new problems related to the North American free trade agreement

As the Mexican economy prepares to transition from a relatively closed and protected market to a regionally integrated free market which is part of the proposed North American Free Trade Agreement (NAFTA), a change in its technology licensing environment will be needed to enable Mexican companies to compete for technology with firms from the other member countries of the NAFTA. This study identifies the national sources which have provided Mexico with technology and the Mexican industrial sectors which have been able to attract this technology in the 1980s. It further evaluates the current licensing environments in Canada, Mexico, and the U.S.A. as well as in the Latin American Integration Association (LAIA). The study provides recommendations for changes to the Mexican licensing environment and proposes strategies for attracting technology to Mexican industry under the changed conditions which would be introduced by the NAFTA. © 1993 John Wiley & Sons, Inc.     

Accounting conservatism and the profitability of corporate insiders

We predict that accounting conservatism influences insiders' opportunities to speculate on good and bad news, and thus, insider trading profitability. We find that greater conditional (unconditional) conservatism is associated with lower (higher) insiders' profitability from sales. We find limited evidence that conservatism influences profitability from purchases. These findings are consistent with our hypotheses on the different informational roles of conditional and unconditional conservatism, and on the asymmetric influence of conservatism over the opportunities to speculate on good versus bad news. Our research design takes into consideration the endogenous nature of insiders' trading and conservatism. The results are robust to different measures of conservatism and a number of additional analyses.     

Audit firm tenure and audit quality: A cross‐European study

Directive 2014/56/EU and Regulation (EU) No. 537/2014, which came into effect in June 2016, introduced the mandatory rotation of audit firms after a maximum period of 10 years with the same client. We conduct a cross‐European study with the aim of assessing whether long audit firm tenures are associated with lower levels of audit quality. The sample for the study is based on the constituents of the Standard & Poor's Europe 350 index for the years between 2009 and 2016, and we utilize three different sets of proxies for audit quality: discretionary accruals, differences between reported earnings and earnings benchmarks, and accounting restatements. The main result of the study finds that companies with more than 10 years of tenure with their auditors do not have a lower audit quality than other firms. In fact, this study provides some evidence of a higher audit quality for these firms. The results are robust to various checks. Therefore, if there does not seem to be a problem of a lack of audit quality associated with long audit firm tenures, the necessity of establishing a maximum tenure, as the new European regulation does, may be questioned.     

Conjoint Analysis of Tourist Choice of Hotel Attributes Presented in Travel Agent Brochures

The purposes of this study are to demonstrate how it is possible to determine which attributes are the most important in the final choices of tourists who use a travel agent brochure as a source of information and how these attributes influence perceived value in a pre‐purchase stage. We conduct the study in three phases: (i) a qualitative study, (ii) an experiment using choice‐based conjoint analysis by means of a fractional factorial experimental design and (iii) another experiment using a full factorial derived from the same design. Results suggest advertisement size, a hotel's starred rating and price influence perceived value at this stage. The presence of a positive combined effect of price and advertising was found. Implications and directions for future applications are offered, focusing particularly on marketing services. Copyright © 2012 John Wiley & Sons, Ltd.     

The Term Structure of Implied Forward Volatility: Recovery and Informational Content in the Corn Options Market

Using a flexible method, we develop the term structure of volatility implied by corn futures options with differing maturities, and evaluate its ability to predict subsequent realized price volatility. The implied forward volatilities anticipate realized volatility well. For the nearby interval, the implied forward volatilities provide unbiased forecasts, and are superior to forecasts based on historical volatilities. For more distant intervals, early-year options predict the direction and magnitude of future volatility changes about as well as a three-year moving average and better than a naïve forecast. However, later-year options display less forecast power in part due to reduced trading activity.     

Estimation of stable distributions by indirect inference

This article deals with the estimation of the parameters of an α-stable distribution with indirect inference, using the skewed-t distribution as an auxiliary model. The latter distribution appears as a good candidate since it has the same number of parameters as the α-stable distribution, with each parameter playing a similar role. To improve the properties of the estimator in finite sample, we use constrained indirect inference. In a Monte Carlo study we show that this method delivers estimators with good properties in finite sample. We provide an empirical application to the distribution of jumps in the S&P 500 index returns.