Housing Tenure Choice in Australia and the United States: Impacts of Alternative Subsidy Policies

This article compares the homeownership rates of young households in Australia and the United States and evaluates the impacts of the two countries' different approaches to subsidizing homeownership. Since about 1950, Australia's rate of homeownership has consistently been higher than that of the United States. The homeownership rate for young adults is also significantly higher in Australia. While the United States allows mortgage interest and property taxes to be deducted from income for tax purposes, Australia has provided cash subsidies for down payments and mortgage payments. We conclude that differences in housing costs and household characteristics do not explain differences in ownership rates. We also conclude that differences in subsidy policies have only a minor impact on ownership rates.     

A Match Made in Heaven: A Marginalized Methodology for Studying the Marginalized

Marginalization consists in not taking others into account on any number of valued outcomes, resulting in powerlessness, ignorance, poverty, illness, insecurity, and other manifestations of devaluation. Two illustrations are presented, including a brief summary of Q methodology, an innovation in factor theory that was marginalized by 20th century developments in psychometrics but has more recently experienced a revival in interest, and which is particularly suited to illuminating and clarifying perspectives, including those of marginalized populations. The procedures associated with Q methodology are demonstrated in terms of clarifying the goals of a Central American initiative to foster development. A second illustration focuses on the applicability of Q methodology in revealing marginalized tendencies within single individuals. A variety of other recent and current applications are briefly summarized.     

Interest Rates, Exchange Rates and Present Value Models of the Current Account

This paper develops a testable intertemporal model of the current account that allows for variable interest rates and exchange rates. These additional variables are channels through which external shocks may influence the domestic current account. The restrictions from the theoretical model are subjected to present value tests using quarterly data from three small open economies. The paper finds that including the interest rate and exchange rate improves the fit of the intertemporal model over what was found in previous studies. The model predictions better replicate the volatility of current account data and better explain historical episodes of current account imbalance.     

Value Relevance of Mandated Comprehensive Income Disclosures

This paper examines the association between acquisiton-related provision-taking behaviour and post-acquisition performance for a sample of UK firms that undertook large acquisitions between 1989 and 1995. We find evidence that provision-taking was associated with declining accounting and market-adjusted stock price performance over the three-year period following the fiscal year of the acquisition. This relationship exists after controlling for a variety of factors, including method of payment in the acquisition and post-acquisition cash flow performance. By implication, post-acquisition abnormal returns appear to have been predictable based on publicly available information about the magnitude of the provisions. These findings are consistent with the following scenario: The management of the high provisioners used the provisions to insulate accounting earnings from the effects of declining cash flows. The market belatedly reacted to these firms' declining fortunes when net income was no longer inflated by provision reversals.     

Help or Hindrance? Causal Ambiguity and Supplier Involvement in New Product Development Teams

Suppliers are increasingly being involved in interorganizational new product development (NPD) teams. Successful management of this involvement is critical both to the performance of the new product and to meeting the project's goals. Yet the transfer of knowledge between buyer and supplier may be subject to varying degrees of causal ambiguity, potentially limiting the effect of supplier involvement on performance. Understanding the dynamics of causal ambiguity within interorganizational product development is thus an important unanswered empirical question. A theoretical model is developed exploring the effect of supplier involvement practices (supplier involvement orientation, relationship commitment, and involvement depth) on the level of causal ambiguity experienced within interorganizational NPD teams, and the subsequent impact on time to competitor imitation, new product advantage, and project performance. The model also serves as a test of the paradox that causal ambiguity both inhibits imitation by competitors, but adversely affects organizational outcomes. Survey data collected from 119 research and development‐intensive manufacturing firms in the United Kingdom largely support these hypotheses. Results from structural equation modeling show that supplier involvement orientation and long‐term relationship commitment lower causal ambiguity within interorganizational NPD teams. The results also shed light on the causal ambiguity paradox showing that causal ambiguity during interorganizational NPD decreases both product and project performance, but has no significant effect on time to competitor imitation. Instead, competitor imitation is delayed by the extent to which the firm develops a new product advantage within the market. A product development strategy based upon maintaining interfirm causal ambiguity to delay competitor imitation is thus unlikely to result in a sustainable competitive advantage. Instead, managers are encouraged to undertake supplier involvement practices aimed at minimizing the level of knowledge ambiguity in the NPD project, and in doing so, improve product and project‐related performance.     

Effect of audit report disclosure on auditor litigation risk

Internationally, the escalating number of cases levelled against auditors and the costs of defending such actions has led to the auditing profession calling for measures to reduce their liability burden. Relatively few measures have been taken by the auditing profession by way of adapting the disclosure contained in the audit report to mitigate their litigation risk. This study examines whether the issuance of an audit opinion with a going concern related ‘emphasis of matter’ paragraph or work practices disclosure has any effect on potential litigants' likelihood of pursuing litigation against the auditor. An analysis of 69 responses from advanced law students and 18 practitioners working in corporate liquidation demonstrate that a modified (but not qualified) audit report effectively acts as a ‘red flag’ and reduces potential litigants' propensity to initiate litigation. However, work practices disclosure did not significantly alter potential litigants' inclination to recommend litigation. Despite this finding, respondents (particularly liquidators) indicated that work practices disclosure was an important factor in their litigation decision. These results suggest that further investigation into how to effectively disclose the work done on audit and assurance engagements is needed. This has implications for standard setters and the auditing profession, especially considering recent changes in the disclosure contained in audit and assurance reports.     

当重组见效之际

强大的业务理念不同于战略,所谓战略是为实现具体目标的一系列详细行动的方针,而理念是一种具有鼓舞力和凝聚力的见解。