Use of loan loss provisions for capital, earnings management and signalling by Australian banks

This study examines whether and to what extent Australian banks use loan loss provisions (LLPs) for capital, earnings management and signalling. We examine if there were changes in the use of LLPs as a result of the implementation of banking regulations consistent with the Basel Accord of 1988, which made loan loss reserves no longer part of Tier I capital in the numerator of the capital adequacy ratio. We find some evidence to indicate that Australian banks use LLPs for capital management, but we find no evidence of a change in this behaviour after the implementation of the Basel Accord. Our results indicate that banks in Australia use LLPs to manage earnings. Furthermore, listed commercial banks engage more aggressively in earnings management using LLPs than unlisted commercial banks. We also find that earnings management behaviour is more pronounced in the post‐Basel period. Overall, we find a significant understating of LLPs in the post‐Basel period relative to the pre‐Basel period. This indicates that reported earnings might not reflect the true economic reality underlying those numbers. Finally, Australian banks do not appear to use LLPs for signalling future intentions of higher earnings to investors.     

When customers get clever: Managerial approaches to dealing with creative consumers

Creative consumers (defined as customers who adapt, modify, or transform a proprietary offering) represent an intriguing paradox for business. On one hand, they can signify a black hole for future revenue, with breach of copyright and intellectual property. On the other hand, they represent a gold mine of ideas and business opportunities. Central to business is the need to create and capture value, and creative consumers demand a shift in the mindsets and business models of how firms accomplish both. Based upon their attitude and action toward customer innovation, we develop a typology of firms' stances toward creative consumers. We then consider the implications of the stances model for corporate strategy and examine a three-step approach to dealing with creative consumers: awareness, analysis, and response.     

An analysis of substance abuse patterns, medical expenses and effectiveness of treatment in the workplace: long-term followup

This study of workplace substance abuse programs indicates that they are effective for many participants and also shows that these programs can significantly lower medical expenses for those who successfully complete them.     

An analysis of substance abuse patterns, medical expenses and effectiveness of treatment in the workplace

This article examines the effectiveness of substance abuse treatment offered by the Members Assistance Program of a self-insured union welfare fund. The authors find that medical costs decreased dramatically for participants who were under treatment for at least one year.     

Measuring the Extent of Impact from Occupational Violence and Bullying on Traumatised Workers

Across the industrialised world, there is evidence that both the incidence and the severity of occupational violence and bullying are increasingly being reported over time. While there have been few substantive scientific studies in Australia, all the available evidence shows a similar increasing level of risk. It has long been assumed that those who suffer a physical assault during the course of violent events are more likely to be emotionally traumatised by the experience than are those who are merely threatened or bullied at work. However, there are no substantive data published to date. In this paper the authors aim to elucidate and quantify the extent of emotional injury/stress suffered as a result of different forms of occupational violence, based on empirical data collected during face-to-face interviewing of 800 Australian workers employed in the tertiary education, health and long-haul transport industry sectors. The authors conclude that the impact from more covert forms of occupational violence (such as bullying) can, in many instances, at least equal the emotional trauma following assaults on-the-job.     

Wage and price determination in a labour-exporting economy: The case of Ireland

A model designed to incorporate external influences through the labour and goods markets on the rates of domestic wage and price inflation is specified and estimated from postwar Irish data. It consists of equations explaining the rate of change of prices, migration, the supply of labour, the rate of change of wages and three identities. The model is both simultaneous and nonlinear, and an appropriate modification of the two-stage least-squares estimation technique is used. The estimated equations explain between 71 percent and 84 percent of the variance in the dependent variables. Since two of these are proportionate first differences, the remaining two a ratio and a first difference, this might be deemed satisfactory. However, some of the individual coefficient estimates are not.     

US urban empowerment zones

The designation of empowerment zones marked a significant shift in federal policy for urban regeneration in the US, and the six urban empowerment zones designated in Atlanta, Baltimore, Chicago, Detroit, New York and Philadelphia-Camden have now begun to achieve results in terms of implementing social projects and attracting investment for economic development. While interim results seem disappointing in comparison to original expectations for the zones, a consideration of the theoretical underpinning of the empowerment zone initiative suggests that this is unsurprising and that the zones may have raised expectations for regeneration unnecessarily.     

The behavior of money and other economic variables: Two natural experiments

The object of this paper is to test the performance of the quantity-theory model and the related proposition of monetary neutrality in a context in which, to use Bernanke's phraseology, “money move[d] for reasons that [were] plausibly unrelated to the current state of the economy.” We investigate this question using data from two recent episodes of monetary-policy regime change – the move to floating exchange rates throughout the industrialized world following the breakdown of Bretton Woods in the early 1970s and the shift toward less expansive monetary policy that to varying degrees took place in these countries a decade or so later. The results of this exercise are highly positive. The money–price relationship that we observe is fully consistent with theory – growth shifts in the nominal stock of money and in the price level are highly correlated and bear a one-to-one relation to one another. Growth shifts in exchange rates are significantly related both to growth shifts in relative price levels and to growth shifts in relative excess supplies of money. The classical neutrality proposition – in this context superneutrality – in general, receives strong, though not totally unambiguous, support.     

Reversible Relationship between Quantitative and Qualitative Data in Self-Consciousness Research: A Normative Semiotic Model for the Phenomenological Dialogue between Data and Capta

The aim of this study was to explore modes of integration of quantitative and qualitative data to verify existence of psychological constructs. Data obtained with a Likert-type rating scale and with narrative accounts of significant life-events were compared and integrated via logical analysis to examine the psychological construct of self-consciousness. Undergraduates between 17 and 32 years of age (78 females and 23 males) participated. Psychometric analysis of the scale classified the subjects focus of self-consciousness (public and private) into three levels: high, average or low. Independent judges evaluated self-consciousness profiles from the narrative accounts. Analysis verified the compatibility between self-consciousness scale measurements and self-consciousness profiles on narrative accounts. The results illustrate possibilities for and limitations of such comparisons, and also suggest criteria for comparing the same phenomenon in different contexts. Guidelines for choice of instrumentation in gathering data for research and practice are also presented.