The Tax Cut as an Anti-Inflationary Measure*

‘…the Government is convinced that the right course at this juncture, and the best contribution it can make to the solution of the current problems of our economy, is a bold policy of reducing taxes—particularly those taxes which are levied directly upon individuals and upon business. We believe that this is the best form of assistance we can give in the attack on costs. Essentially, the cost problem is one to be solved by greater efforts and greater efficiency on the part of both labour and management. By reducing taxes and so making wages and profits more worth earning, the Government can provide an inducement to greater effort and greater efficiency…’ ‘…the Government proposes to reduce taxes up to the limit of budget capacity after making provision for essential expenditures… and it has devised the tax reductions in a way that will ensure the maximum incentive to effort while making whenever possible a direct reduction in costs. At the same time it has taken care to ensure that the Budget for the year will balance; for there could be no thought at a time like this of adding to the volume of spending power by the process of deficit-financing… As in last year's Budget, the greatest weight should be given to reductions of Income Tax on individuals. By so doing the benefits will spread most widely and the greatest number of people will receive a further incentive to work and to save. The Government has, however, explored the possibilities of reducing indirect taxation, and it is proposing some very useful reductions in that field. Some of these reductions will make an important direct contribution to the problem of reducing costs’     

What Will Consumers Pay for Social Product Features?

The importance of ethical consumerism to many companies worldwide has increased dramatically in recent years. Ethical consumerism encompasses the importance of non-traditional and social components of a company's products and business process to strategic success – such as environmental protectionism, child labor practices and so on. The present paper utilizes a random utility theoretic experimental design to provide estimates of the relative value selected consumers place on the social features of products.     

Using Best–Worst Scaling Methodology to Investigate Consumer Ethical Beliefs Across Countries

This study uses best–worst scaling experiments to examine differences across six countries in the attitudes of consumers towards social and ethical issues that included both product related issues (such as recycled packaging) and general social factors (such as human rights). The experiments were conducted using over 600 respondents from Germany, Spain, Turkey, USA, India, and Korea. The results show that there is indeed some variation in the attitudes towards social and ethical issues across these six countries. However, what is more telling are the similarities seen and the extent to which individual variation dominates observable demographics and country-based variables. Pat Auger is Associate Professor at the Melbourne Business School. Timothy M. Devinney is Professor and Director of the Centre for Corporate Change at the Australian Graduate School of Management. Jordan J. Louviere is Professor of Marketing at the University of Technology, Sydney.     

Scholarly achievement and accounting journal editorial board membership

The importance of editorial boards to the peer review process makes it imperative that board members be selected on the basis of proven records of scholarly achievement as demonstrated by publications in peer-reviewed journals and subsequent citations to those publications. Although research in accounting has looked at the composition of editorial boards, the scholarly achievement of editorial board members has not been examined. The purpose of our study is to empirically investigate the scholarly achievement of editorial board members of selected accounting journals. We find that the top accounting journals may not be using the same criteria in selecting editorial board members. Further, the level of achievement of the editorial board members and their articles’ impact factors were often inconsistent with the perceived ranking of the journals in which they served. A discussion and implications of our results are also provided.     

Price dynamics in the Bangladesh rice market: implications for public intervention

In this paper, the price dynamics of a rice market are examined using dynamic programming techniques. The model is parameterised to the case of Bangladesh and thus represents the situation of a very poor country which has characteristically high price elasticity (due to income effects) and high storage and interest costs. The incentives for private sector storage and its impact on price stability are examined. Various options for public intervention in the storage sector are also explored, including price ceiling schemes and subsidisation of storage costs. Results show that interventions that remove private disincentives (such as storage subsidies) are much cheaper than direct intervention by government, but the impact on the probability distribution of prices is quite different. The effect of trade on the probability distribution of prices is also examined.     

Threat of falling high status and corporate bribery: Evidence from the revealed accounting records of two South Korean presidents

Research Summary: Social status and its dynamics may be an important predictor of which firms will engage in large‐scale bribery. Prior theory is incomplete, however, and prior studies have lacked comprehensive and reliable data on firm‐level bribery decisions. We offer a new theoretical prediction and a novel data set on high‐level corruption in South Korea, where the accounting records of two presidents in the 1987–1992 era were exposed to after‐the‐fact legal and public scrutiny. We find that, controlling for a range of alternative explanations, the threat of falling high status—that is, the combination of longstanding high social status with current‐period mediocre economic performance relative to that of industry peers—is a statistically and economically meaningful predictor of increases in the amount of large‐scale corporate bribery. Managerial Summary: What leads companies to engage in large‐scale bribery of senior politicians? Our concept of “threat of falling high status” refers to a circumstance where companies that have historically enjoyed high status through their owner families’ elite marriage networks experience mediocre economic performance relative to their peers. We show that this threat of falling high status is a notable determinant of large‐scale corporate bribery of senior politicians, using court data on corporate bribery of two South Korean presidents during 1987–1992. The implication of our study is twofold. Companies can strengthen internal control systems to avoid any large‐scale illegal activities at a higher level. Law enforcement agencies can also implement targeted monitoring programs to preempt illegal activities among companies facing the threat of falling high status.     

Consumer vulnerability and complaint handling: Challenges,opportunities and dispute system design

Effectively designed complaint handling systems play a key role in enabling vulnerable consumers to complain and obtain redress. This article examines current research into consumer vulnerability, highlighting its multidimensional and expansive nature. Contemporary understandings of consumer vulnerability recognize that the interaction between a wide range of market and consumer characteristics can combine to place any individual at risk of vulnerability. While this broad definition of consumer vulnerability reflects the complex reality of consumers’ experiences, it poses a key challenge for designers of complaint handling systems: how can they identify and respond to an issue which can potentially affect everyone? Drawing on current research and practice in the United Kingdom and Australia, the article analyses the impact of consumer vulnerability on third party dispute resolution schemes and considers the role these complaint handling organizations can play in supporting their complainants. Third party complaint handling organizations, including a range of Alternative Dispute Resolution services such as ombudsman organizations, can play a key role in increasing access to justice for vulnerable consumer groups and provide specific assistance for individual complainants during the process. It is an opportune time to review whether the needs of consumers at risk of vulnerability are being met within complaint processes and the extent to which third party complaint handlers support those who are most vulnerable to seek redress. Empowering vulnerable consumers to complain presents specific challenges. The article discusses the application of a new model of consumer dispute system design to show how complaint handling organizations can meet the needs of the most vulnerable consumers throughout the process.     

Stochastic Interest Rates and the Bond-Stock Mix

The optimal bond-stock mix is examined in light of an apparent inconsistency between the Tobin Separation Theorem and the advice of popular investment advisors which has beenpointed out by Canner et al. (1997). It is shown that the apparent inconsistency is largely explicable in terms of the hedging demands of optimising long-term investors in an environment in which the investment opportunity set is subject to stochastic shocks. The analysis points to the importance of considering investors' time horizons in analyzing optimal portfolio policies.