The Role of Objective In Vivo Testing in the Product Development Process

New products managers are continually confronted by the challenge of coordinating flows of complex information during the product development process. Among the issues faced are unique problems in relating technical design of product attributes to customers' reactions, leading to an improvement of the product's benefits. Ronald Drozdenko and Sidney Weinstein describe a variety of tests which help to assess customers' reactions to products, thus providing information to improve the design or to substantiate advertising claims. The term "objective in vivo" is given to a category of tests which is employed to quantify consumers' evaluation of specific product attributes under controlled, simulated use conditions. This helps to bridge the gap between tests which are designed to measure the physical or functional aspects of new products and tests which measure the consumers' self-reported, subjective reactions. A test categorization model, illustrative case studies, and test selection criteria are presented.     

Currency Swaps and International Real Estate Investment

This paper examines the efficacy of currency swaps as a hedging mechanism for the exchange rate risk associated with foreign investment in real estate. Earlier studies have concentrated on short-term hedging instruments such as options and forward contracts. Currency swaps are better suited for use on investments with long-term holding periods such as real estate. The findings indicate that, although hedging United States real estate investments with currency swaps suppresses most of the risk induced by currency instability, the improvements are insufficient to produce diversification gains for foreign investors in the context of mean-variance portfolio performance.     

A Comparative International Analysis of the Impact of Accounting Principles on Profits: The USA versus the UK,Sweden and The Netherlands

This paper explores the extent to which there are material quantitative differences in profits reported under US GAAP compared to profits reported in accordance with generally accepted accounting principles in the UK, Sweden and the Netherlands. From an analysis of Form 20-F reports filed with the SEC in the USA, there is support for the hypothesis that UK GAAP are significantly less conservative than US GAAP. On the basis of a case study approach, it seems that Swedish GAAP tend to be more conservative than US GAAP, particularly when the transfers to reserves are analysed, but there is insufficient evidence to establish a systematic pattern. In the Netherlands, on the other hand, there is evidence to suggest that Dutch GAAP are at the less conservative end of the spectrum of financial reporting measurement practices, in a position relatively similar to that of UK GAAP, although again the evidence is insufficient to establish a systematic pattern.     

Asymmetric effects of shocks on TFP

We study the TFP distribution and examine the non-stationarity of productivity series at various quantiles. Using the quantile autoregression unit root test, we find that the US TFP exhibits an asymmetric adjustment dynamics, that is, positive and negative shocks might have different (permanent or temporary) effects on the TFP. Shocks dissemination depends on the local behaviour of the TFP. We find that positive shocks have permanent effects on the TFP, while negative shocks can potentially have only transitory effects.     

Family control, board independence and earnings management: Evidence based on Hong Kong firms

In this study, we document that independent corporate boards of Hong Kong firms provide effective monitoring of earnings management, which suggests that despite differences in institutional environments, corporate board independence is important to ensure high-quality financial reporting. The findings also show that the monitoring effectiveness of corporate boards is moderated in family-controlled firms, either through ownership concentration or the presence of family members on corporate boards. The results based on firms reporting small earnings increases provide additional support for our finding that the monitoring effectiveness of independent corporate boards is moderated in family-controlled firms.     

The fifth credit tranche

This paper asserts that for all practical purposes the Compensatory Financing Facility (CFF) of the IMF has been abolished except in the name by an IMF decision of 14 September 1983. Since CFF was originally intended to finance temporary and reversible deficits resulting from export shortfalls due to factors beyond a country's control, drawings were usually authorized within a month at low conditionality. The 1983 decision does away with this semi-automaticity, thereby accommodating CFF to the high-conditional upper credit tranches. This development is symptomatic of a general tendency to limit the Fund to high-conditional financing regardless of circumstances.