How Do Investors Regard ESOs?

All top‐50 and more than 80% of the top‐500 Australian listed companies now reward their executives with stock options (ESOs) of one kind or another.₁ We address the question: “Which method of accounting for ESOs — current practice, the US FASB's recommended practice or the AASB's preferred position — most closely reflects investors' pricing decisions?” We answer the question using models that relate a company's stock price to its earnings and book value of equity calculated according to these three choices of accounting treatment.     

Ranking Journals Using Social Science Research Network Downloads

I use a new approach to rank journals, namely the number and percent frequency of articles a journal publishes that are heavily downloaded from the Social Science Research Network (SSRN). I rank 18 accounting and finance journals, and I identify five journals not considered by the two most recent major published ranking studies of publications by accounting faculty, namely (in rank order): Journal of Financial Economics, Review of Accounting Studies, Review of Quantitative Finance and Accounting, Journal of Corporate Finance, and Journal of International Financial Management and Accounting. I show that financial accounting faculties are more likely to post their working papers to SSRN, and papers posted by financial faculties generate more downloads. I mitigate this bias in favor of the financial area by providing separate rankings based on authors in the financial versus non-financial areas.     

Redistribution and Insurance: Mandatory Annuitization With Mortality Heterogeneity

This article examines the distributional implications of mandatory longevity insurance when mortality heterogeneity exists in the population. Previous research has demonstrated the significant financial redistribution that occurs under alternative annuity programs in the presence of differential mortality across groups. This article embeds that analysis into a life‐cycle framework that allows for an examination of distributional effects on a utility‐adjusted basis. It finds that the degree of redistribution that occurs from the introduction of a mandatory annuity program is substantially lower on a utility‐adjusted basis than when evaluated on a purely financial basis. In a simple life‐cycle model with no bequests, complete annuitization is welfare enhancing even for those with higher‐than‐average expected mortality rates, so long as administrative costs are sufficiently low. These findings have implications for policy toward annuitization, particularly as part of a reformed Social Security system.     

Informational Networks, Entrepreneurial Action and Performance

This paper develops a model that incorporates personal and business networks, firm action, and performance based on the existing literature. It explores the links between information and entrepreneurial-type action, and action and performance. Survey data was collected from a sample of 100 manufacturing firms in Thailand. Results show that entrepreneurs value the information they receive from their networks. However, there is little statistical support for tangible links between personal or business networks and entrepreneurial action and performance, or between action and performance.     

Measuring new product success: an empirical investigation of Australian SMEs

New product development (NPD) has long been recognised as one of the corporate core functions. However, measuring new product success has remained elusive. This paper attempts to examine several conceptual issues underlining the measurement of new product success and the measurement practice adopted in Australian small and medium enterprises (SMEs). The sample included 276 SMEs from two most innovative industries: chemical and machinery industries. Results have indicated that four factors underline the commonly used success measurement: financial performance, objective market acceptance, subjective market acceptance, and product-level measures. These four factors are related to each other and can be used to well predict the overall measurement. The most frequently used specific measures in Australian SMEs are customer acceptance, customer satisfaction, product performance, and quality.     

The Landscape of Economic Growth: Do Middle-Income Countries Differ?

We review the growth experience of middle-income countries. Economic factors associated with growth appear to differ between middle-income and other countries. The efficiency of the financial system is importantly related to the growth rate in low- and middle-income countries, but appears to matter less as one moves up the income scale. Demographic variables also matter importantly in low-income countries. In middle-income countries, in contrast, measures of the financial system no longer appear to matter as importantly, as if inefficiencies in banking and financial systems are no longer as binding a constraint as at earlier stages of financial development; nor are demographic variables as important as before. At this point, other variables gain a growing role: these include whether the country experiences a banking or currency crisis, the extent of non-foreign direct investment capital inflows, and government debt as a share of gross domestic product.     

Informal Traders and the Battlegrounds of Revanchism in Cusco,Peru

Informal trading in the global South, particularly in Latin America, is the subject of revanchist urban policy and yet few studies have examined the longer‐term impacts of such intolerant policies on traders. This article explores the evolution and impacts of revanchist policies directed at informal traders in the Andean city of Cusco. It makes two key contributions. First, it documents a shift from early revanchist policies to a post‐revanchist era where policies have become more tolerant of informal traders. However, contemporary policies fall short of a supportive environment for informal trading, hence the authors recommend changes that will ensure informal traders can access the city's streets and become an accepted part of the urban fabric. Second, given the lack of theoretical attention given to the impacts of revanchism, a battlegrounds framework is developed, consisting of spatial, political, economic and socio‐cultural battlegrounds. This framework provides a comprehensive insight into the complex set of interactions that exist between informal traders and the state. It is hoped that the framework will provide a tool for further research into the highly damaging impacts of revanchism across the globe.