Earnings Management and Antitrust Investigations: Political Costs Over Business Cycles

This paper examines evidence of earnings management pertaining to regulatory-imposed wealth transfers (i.e., political costs) over business cycles. The sample consists of firms subject to merger-related antitrust investigation under Section 7 of the Clayton Act. Industrial organization literature, together with the political cost hypothesis, suggests that these firms' earnings management incentives may vary over national business cycles. Our results indicate that investigated firms do indeed choose income-decreasing discretionary accruals during expansions but not during recessions, in order to reduce the political costs associated with Clayton Act cases.     

The Value-Relevance of Derivative Disclosures by Commercial Banks: A Comprehensive Study of Information Content Under SFAS Nos. 119 and 133

This study examines the value-relevance of banks' derivative disclosures under Statements of Financial Accounting Standards (SFAS) Nos. 119 and 133. Using the complete time-series of SFAS No. 119 disaggregated notional value disclosures and the most recently available SFAS No. 133 fair value data, this study investigates whether such expanded disclosures provide incremental information content beyond earnings and book value. Our results indicate that banks' notional principal amount disclosures are value-relevant, and that this evidence of incremental information content is robust to the inclusion of recently available fair value data and alternative model specifications. JEL Classification: M41, G21     

An Examination of Long-Term Abnormal Stock Returns and Operating Performance Following R&D Increases

We examine a sample of 8,313 cases, between 1951 and 2001, where firms unexpectedly increase their research and development (R&D) expenditures by a significant amount. We find consistent evidence of a misreaction, as manifested in the significantly positive abnormal stock returns that our sample firms' shareholders experience following these increases. We also find consistent evidence that our sample firms experience significantly positive long‐term abnormal operating performance following their R&D increases. Our findings suggest that R&D increases are beneficial investments, and that the market is slow to recognize the extent of this benefit (consistent with investor underreaction).     

An empirical study of human resource management policies and practices in foreign-invested enterprises in China: the case of Shenzen Special Economic Zone

Information about human resource management (HRM) practices in foreign-invested enterprises (FIEs) in China has been limited to studies involving a small number of cases. This study provides an empirical assessment of HRM practices used in 158 FIEs operating in Shenzen Special Economic Zone (SEZ) of the Guangdong Province in southern China. Results suggest that FIEs have moved away from centrally planned job allocation, life-time employment and egalitarian pay towards open job markets at management and non-management levels, contractual employment where pay and longevity are based on individual worker and company performance and compensation plans that recognize differences in skills, training and job demands. These practices seem to reflect the influence of the economic reform in China. Other aspects of HRM practices used by FIEs, such as approximate equality of pay for men and women, limited differences between management and non-management salaries and widespread provision of housing and other benefits for employees, seem to reflect the influence of the Chinese socialist ideology.     

Dividend policies across multinational and domestic corporations – an international study

This study examines whether the determinants of dividend payout ratios between Multinational (MCs) and Domestic corporations (DCs) vary across Australia, U.S., Japan, U.K. and Malaysia. Results show: (i) Australian, UK and Malaysian MCs pay significantly less dividends than their Domestic counterparts; however, the opposite holds for the U.S. firms; (ii) the factors that significantly explain the difference between DCs’ and MCs’ payout ratios vary across countries; (iii) firms operating in an imputation tax system and in a common law environment pay comparatively higher dividends relative to firms operating in a classical tax system and civil law regime.     

Auditor Lobbying for Accounting Standards: The Case of Banks and Savings and Loan Associations

This study examines auditor lobbying on seven proposed US accounting standards which affect banks and savings and loan associations. Evidence is provided in support of the Watts and Zimmerman (1982, 1986) theory on auditor lobbying. Watts and Zimmerman (WZ) hypothesise that auditor lobbying is a function of the client-manager position and a set of wealth effect variables. These variables may provide an incentive for auditors to disagree with their clients on proposed accounting issues. The WZ model is modified by including an audit risk variable. Results show that the model is statistically significant and that the identified wealth and audit risk effects are significant explanatory variables of auditor lobbying behaviour.     

Relationships between innovation stimulus, innovation capacity, and innovation performance

This paper examines the integration of the human and technological aspects of innovation management by modelling the innovation stimulus – innovation capacity relationship in determining innovation performance. The research framework developed in this study was tested amongst 194 managers of Australian firms. The survey responses indicate that both the relationships between innovation stimulus and innovation capacity and between innovation capacity and innovation performance are significant and strong. However, innovation stimulus does not show any direct effect on innovation performance, suggesting that its effect is mediated through innovation capacity. The overall practical implication that can be drawn from the findings is that to achieve high innovation performance, organizations first need to develop the behavioural and cultural context and practices for innovation (i.e. stimulus), and only within such conducive environments is it possible for organizations to develop innovative capacity in research and development and technology so as to more effectively deliver innovation outcomes and performance.     

中原经济区耕地压力时空演变及驱动因素研究

[目的]严守耕地红线、合理利用和保护耕地资源,保障国家粮食安全。[方法]文章采用最小人均耕地面积和耕地压力指数模型,分析了2007—2016年中原经济区耕地压力时序变化特征,引入重心转移模型和变异系数,探究耕地压力重心的空间分布及迁移特征,并基于粮食生产因素和社会经济因素双重视角,选取10个指标运用灰色关联分析法对影响中原经济区耕地压力变化的驱动因素进行研究。[结果]2007—2016年中原经济区耕地压力指数呈现阶段性特征,总体处于波动递减的趋势,各地级市耕地压力离散程度和空间差异不断拉大,空间分布不均衡,东西分化趋势显著;耕地压力重心从西北向东南方向迁移,在郑州市区域移动;选取的影响因素指标对耕地压力变化均有影响,关联度大小依次为人均GDP城市化水平农民收入产业结构化肥投入灌溉水平复种指数粮食单产量耕地质量人均耕地面积。[结论]社会经济因素对耕地压力影响显著,是影响耕地压力变动的主导因素。     

Dividend payout determinants for Australian Multinational and Domestic Corporations

I investigate the determinants of dividend payments for Australian Multinational Corporations (MCs) and Domestic Corporations (DCs). Six measures of dividend payout ratios are investigated, and five international factors are employed in addition to traditional factors. I find: MCs pay significantly less regular cash, special cash, total dividends and net dividends relative to DCs; the degree of foreign involvement is important in determining special cash and net dividend payments; MCs are more active than DCs in dividend increasing activities; and MCs are significantly less likely to be a dividend payer relative to DCs due to tax disadvantages coupled with unfavourable foreign risk exposures.