Company investment announcements and the market value of the firm

This paper examines the stock market reaction to 402 company investment announcements made by UK companies during the 1991–1996 period. The market-adjusted abnormal returns are generally positive but small. Investment announcements are classified according to functional categories, and we find the level of abnormal returns to vary according to the type of capital investment being announced. In particular, we find the market to react more favourably to investments that ‘create’ future investment opportunities, than to investments which can be categorized as ‘exercising’ investment opportunities. The market reaction also varies with firm size, with large companies tending to experience smaller responses to announcements than do smaller firms. Chung et al. (1998 Chung, KH, Wright, P and Charoenwong, C. (1998). Investment opportunities and market reaction to capital expenditure decisions. Journal of Banking and Finance, 22: 41–60.  ) reported that the quality of a company's investment opportunities is the primary determinant of market reactions to capital expenditure decisions. The findings presented here lend some support to a role for investment opportunities in market valuations. Project size is also found to have a significant positive impact on the level of abnormal returns.     

Taxes,Risk Aversion,and the Size of the Underground Economy

Non‐parametric regression analysis was used to investigate the relationship between the effective tax rate and the relative size of the underground economy, using New Zealand data. The underlying theoretical framework is established, and it suggests an ambiguous prediction regarding the sign of the relationship we are studying. However, our non‐parametric empirical analysis, which also allows for the non‐stationarity of the time‐series data, produces a positive and ‘S‐shaped’ relationship, and this supports earlier empirical studies that imposed such functional forms. The estimated model is used to simulate the effects of hypothetical tax changes on the size of the New Zealand underground economy, and to draw policy conclusions.     

The Canadian underground and measured economies: Granger causality results

Using new time-series data for the size of the Canadian underground economy, the relationship between unreported and measured GDP in that country is examined. Granger causality tests are conducted, with a proper allowance for the non-stationarity of the data. It is found that there is clear evidence of such causality from measured GDP to ‘hidden’ output, but only very mild evidence of Granger causality in the reverse direction. This result supports similar evidence for New Zealand reported by the first author, and has several interesting policy implications.     

Where are all the gay fathers?: Reflections on recruiting gay fathers as participants in leisure research

ABSTRACT

There is a dearth of understanding of gay fathers’ perspectives on leisure studies topics. If researchers are to conduct research that better reflects all fathers, it is important to gain insights into recruiting gay fathers, and to ensure that gay fathers know that their perspectives are needed and desired. Thus, in this research note, we highlight two important reflections on the difficulties we encountered when attempting to recruit gay fathers as research participants: (1) Heteronormativity exists in leisure studies and it is problematic for the recruitment of gay fathers; and (2) understaffed organisations are at times unable to help recruit gay fathers for research. Researchers who work with gay fathers may draw on our reflections to overcome similar difficulties that they may face. It is our hope that our reflections may contribute towards achieving the important social justice goal of including gay fathers in leisure studies.     

The US Budget Deficit in Perspective

Is the budget deficit the major problem facing the new administration? Giles Keating of Credit Suisse First Boston in London, argues that the size and significance of the Federal budget deficit is greatly exaggerated.     

SOME HUMAN ASPECTS OF GIVING AND TAKING FARM MANAGEMENT ADVICE

Superimposed on, or underlying, the technical aspects of giving farm management advice are a variety of human considerations. The techniques used and the advice given cannot be divorced from the individuals involved and the way in which advice is communicated. Management advice will be sought for a variety of reasons and from a variety of sources. It will have its own special problems, stemming from the nature of the subject itself, and will generate its own longer term benefits. Differing advisory styles exist but it is possible to suggest some general guidelines and conclusions.     

The Japanisation of Xerox

The impact of Japanese competition has led to attempts by Western organisations to implement elements of Japanese management. The process has been described as'Japanisation'. Here the authors examine the Japanisation of Rank Xerox and Xerox Corporation. Xerox has benefitted from the learning experience of its Japanese joint venture, Fuji Xerox, and has been described as the most'Japanised'of Western companies.     

Discriminating between autoregressive forms: A Monte Carlo comparison of Bayesian and ad hoc methods

The paper considers the problem of discriminating between the autoregressive forms of a Koyck distributed lag model and a regression model with autocorrelated distrubances. Several interpretations of an ad hoc rule-of-thumb suggested by Griliches are compared with Bayesian posterior odds analysis in a Monte Carlo experiment. The Bayesian analysis is generally superior to the rules-of-thumb, the latter exhibiting large probabilities of type I error, and low power. The rules-of-thumb excessively favour the distributed lag model, while the Bayesian method is free from such bias. All methods improve with increased sample size.     

Bioenergy in Southern Africa: An opportunity for regional integration?

ABSTRACT

This introductory paper sets out the rationale for revisiting questions surrounding biofuel futures in Southern Africa and exploring the case for the establishment of a regional market. This contrasts with most research that has focused upon benefits and risks of production and consumption for individual countries. The analysis in this issue suggests that while benefits exist, the key challenges that have stifled production and consumption to date would need to be overcome. Unlocking trade requires relaxing requirements for South African manufacturers to source all their feedstock domestically. Key among factors to encourage production is resolving agricultural investment processes, particularly designing inclusive business models and clarifying land acquisition processes.