Trade Credit and Informational Asymmetry

Commonly used trade credit terms implicitly define a high interest rate that operates as an efficient screening device where information about buyer default risk is asymmetrically held. By offering trade credit, a seller can identify prospective defaults more quickly than if financial institutions were the sole providers of short-term financing. The information is valuable in cases where the seller has made nonsalvageable investments in buyers since it enables the seller to take actions to protect such investments.     

TRADE BARRIERS IN THE PACIFIC FOREST SECTOR: WHO WINS AND WHO LOSES

This study uses a global model of the forest sector to examine changes in log production, consumption, prices, and trade and discusses the impacts of changes on economic wealth transfers for log export ban and log export tax scenarios. The results indicate that trade barriers are inefficient in allocating logs to domestic processors when a supply shortage exists. The trade barrier produces economic losses that exceed the benefits to the processors. A log export ban reduces log prices in the Pacc North-west by 8.5% and reduces timber harvests by 6.7%. The logs diverted to domestic mills save 1,208 more jobs than log export job losses but at an average annual cost of £230,463 per job saved. Economic transfers benefit lumber producers in the region under the ban. However, the benefits amount to 61% of regional timber producer losses including losses in the log export price premium, 39% of the loss to Asian processors, and 55% of the global consumer losses. Globally, lumber consumers lose £733 million. A log export tax scenario produces smaller impacts on prices and harvests since it does not eliminate total log exports. The tax scenario saves no jobs, and the average economic gain per job lost is £24,251 or about two-thirds of the current average salary in the forest products sector in the region. A log tax has the ability to retain £78 million in tax revenues.     

THE DETERMINANTS OF RESEARCH GROUP PERFORMANCE: TOWARDS MODE 2?*

This paper explores the determinants of performance of research groups in the context of the emergence of knowledge as a key intangible asset. It focuses specifically on how best to configure knowledge producers for optimal effectiveness in the current research environment. It explores the under‐researched area of the organization and management of research groups located in and at the interface of university research and focuses on medical and medical‐related research groups. The discussion is embedded within the current debate concerning modes of organization in knowledge production. Factors identified with high‐achievement are: strong leadership; finding, motivating and retaining talent; strategies of related diversification; strongly linked theory and practice and, in particular, network connectedness. Such groups exhibit an increasingly complex internal environment, facilitating a flexible response to an increasingly complex external environment. It finds evidence of Mode 2 working, with increasing use of collaborative strategies and some evidence of a thematic emphasis emerging, although to a lesser extent than the literature suggests, since participants are still working from a strongly disciplinary base. Driven by the more competitive environment, both intellectual and commercial forms of entrepreneurship are present. At the hub of this complex web of inter‐related factors is network connectedness, which proves to be centrally facilitative in mobilizing the other necessary resources.     

Performance Reporting by Australian Government Trading Enterprises: an Empirical Study 1998–2002

Performance reporting forms a critical part of the governance processes of government trading enterprises (GTEs). Accountability and transparency are of particular concern because social obligations of GTEs could be compromised by the growing dominance of commercial objectives. An analysis of the reporting of performance information in the annual reports of selected GTEs over a five-year period revealed a number of inadequacies, including diverse approaches to reporting about effectiveness, service quality, achievement of social objectives and comparative non-financial performance. The analysis reinforces the need for further research into how annual reports can better reflect the performance of government businesses.     

Public Information, IPO Price Formation, and Long-Run Returns: Japanese Evidence

The price formation process of JASDAQ IPOs is more transparent than in the United States. The transparency facilitates analysis of important issues in the IPO literature—why offer prices only partially adjust to public information and adjust more fully to negative information, and why adjustments are related to initial returns. The evidence indicates that early price information conveys the underwriter's commitment to compensate investors for acquiring and/or disclosing information. Offer prices reflect pre-IPO market values of public companies and implicit agreements between underwriters and issuers that originate well before the offering. Underadjustment of offer prices is substantially reversed in the aftermarket.     

The Moderating Effect of Seasonality on Household Apparel Expenditure

This research explores if and how seasonality moderates the effect of consumer characteristics on household per capita expenditure for apparel. The Ordinary Least Squares (OLS) regression analysis was based on quarterly micropanel data from the Continuing Consumer Expenditure Survey. The results confirmed that seasonality moderates the relationship between consumer characteristics and per capita apparel expenditure: the income elasticity of apparel expenditure varied by season as did the effects of age, ethnicity, household size, region, and housing tenure.     

Retail Credit Users' Awareness of Their Credit Insurance Coverage

Retail credit user's awareness of their credit insurance coverage was investigated in telephone interviews. Respondents were divided into two groups: Aware, those who said they had credit insurance and actually did (63 percent of the respondents); and Unaware, those who said they had no credit insurance but actually did (37 percent). The distribution of awareness differed with age and outstanding credit balance. Awareness did not, however, differ with annual income, sex and education. Misperceptions that credit insurance was required also were investigated.     

The Effects of Consumer Education on Consumer Search

This paper reports the results of an empirical investigation of the relationship between selected consumer and marketplace characteristics—focusing on participation in consumer education activities—and consumers’ prepurchase information search behavior. A need exists for further study of the counteractive effects that consumer education is likely to have with respect to preferences for search and to the efficiency with which consumers conduct search.