A NOTE ON THE RELATIONSHIP BETWEEN REPORTED CASH FLOW MEASURES,RATIOS AND THEIR ACCRUAL COUNTERPARTS

This note focuses on information redundancy of cash flow measures reported in and financial ratios derived directly from Cash Flow Statements. Previous research utilised recomputed, “traditional” and “refined”, measures to proxy for cash flow. Comovements are derived amongst various earnings and cash flow key variable measures, select financial ratios and changes in financial ratios. Key variables' results support the notion that reported cash flows are correlated with funds flow and earnings. However, reported cash flows relative to funds flow are less correlated with most of their accrual based counterparts. Cash flows thus have potential to provide new and non-redundant information relative to funds and accruals. Also, the incremental benefit of reported, relative to reconstructed cash flow measures is apparent. In light of the above, the merit of cash flow for the specific decision context of identifying suspended firms is investigated. Cash flow data in this context is found to be as useful as, but not superior to, comparable accruals data.     

Is Trade Good for Your Health?*

We use a panel of 219 countries to examine the relationship between a country’s openness to international trade and several health outcomes and find that, in general, increased openness is associated with lower rates of infant mortality and higher life expectancies, especially in developing countries. We find evidence suggesting that some of the positive correlation between trade and health can be attributed to knowledge spillovers. In addition, openness is associated with sound economic policies which themselves are related to better health outcomes.     

Searching for uncertain benefits and the conservation of biological diversity

This paper describes a model under which the maximization of option value leads to a preference for biological diversity arising from potential substitutability among species.     

Inflation-induced adaptive behavior

Periods of rapidly rising prices are seen by many as cyclical and pervasive phenomena in modern day economic systems. When rapid price increases occur, they are likely to induce adaptive behavior on the part of consumers. This article reports on a study seeking to analyze consumer inflation-induced adaptive behavior as it relates to three food-related consumer activities–food buying, preparation, and consumption. Results indicate that consumers, in general, attempt to adjust to the changing economic environment in several ways: they exercise more care and planning in food shopping, are more price sensitive and price conscious, are willing to sacrifice convenience but not quality, and try to maintain their usual level of food consumption and food habits. Results also indicate that inflation leads to greater adaptive behavior on the part of lower income consumers.     

Reviews

Regenerating town centres. Evans, R. 1997: REGENERATING TOWN CENTRES. Manchester: Manchester University Press, £30.00 cased.

Privatised utilities. Marvin, S., Graham, S. and Guy, S. 1996: PRIVATISED UTILITIES AND REGIONAL MANAGEMENT. Harlow: SEEDS (South East Economic Development Strategy), £25.00 plus £3.50 postage and packing.

Women returners. Chisholm, L. (ed) 1997: GETTING IN, CLIMBING UP AND BREAKING THROUGH. London: The Policy Press, £15.25 paper.

Regionalism. John, P. and Whitehead, A. (eds) 1997: POLICY AND POLITICS VOL 25 NO. 1 SPECIAL ISSUE. REGIONALISM IN ENGLAND: CURRENT TRENDS AND FUTURE PROSPECTS. Policy Press.

Socially regulated labour markets. Peck, J. 1996: WORK-PLACE. THE SOCIAL REGULATION OF LABOUR MARKETS. New York and London: The Guilford Press, £16.99 paper £35.00 cased.

Private delivery — public goods. Arnold-Forster, J., Lee, M. and McLeod, J. 1997: HAND IN GLOVE: PRIVATE SECTOR DELIVERING PUBLIC GOODS. London: Fabian Society, supported by Generale des Eaux, £15.00 paper.

Bio-tech. Milhell, D., Kingham, D. and Stott, M. 1997: THE DEVELOPMENT OF THE BIOTECHNOLOGY SECTOR IN OXFORDSHIRE: IMPLICATIONS FOR PUBLIC POLICY. Oxford: Oxford Innovation Limited, £5.00 paper.     

The Evaluation of Strategic Research Partnerships

Policy implications of strategic research alliances are analyzed, with emphasis on government-private sector cooperation, government support for private sector innovation, and evaluation of such government programs.     

Business model schema: business model innovation tool based on direct causal mechanisms of profit

ABSTRACT

Defining business model as the logic/mode/way/framework to seek profit/money and glancing at the evolution of concept business, this paper develops a business model schema (BMS) as a holistic two-dimensions multi-level tool/method for business model innovation (BMI) based on the direct causal mechanisms of profit (DCMP). First, this paper takes DCMP as the logical/theoretical framework by which business model innovation process is identified and specified. And according to that process, it develops a BMS, illustrates an example of BMS to show up its practical usefulness, compares the similarities and differences between BMS and the existing powerful one business model canvas (BMC), and finally asserts that BMS must be a good and useful method in theory and practice because it stands on DCMP that ensures the genuine causality of profit and also it turns out practically useful, recalling the Kurt Lewin’s maxim (1945), “There is nothing so practical as a good theory.