Financial Statement Comparability and Idiosyncratic Return Volatility

This study examines the association between financial statement comparability and idiosyncratic return volatility (IRV). A greater degree of comparability lowers information acquisition costs, reduces the uncertainties associated with performance evaluation, and increases the overall quantity and quality of information available to corporate outsiders, which, in turn, helps investors to understand and evaluate the cash flow and performance of firms more accurately. Therefore, we hypothesize a negative association between financial statement comparability and IRV. Using a large US sample from 1981 to 2013, we show that financial statement comparability is associated with lower level of IRV significantly. We also find this association to be more pronounced in a poor information environment. This study contributes to the emerging research that stresses the benefits of financial statement comparability.     

Creating a Sustainable Supply Chain Network by Adopting Relationship Management Strategies

ABSTRACT

Purpose: This paper develops a conceptual framework to analyze the impact of a supply chain network (SCN) structure on relationship management strategies (RMS) that focal firms apply to manage sustainability issues within the SCN.

Design/methodology/approach: This paper is based on a comprehensive review and analysis of the industrial marketing and purchasing (IMP), sustainable supply chain management (SSCM), and SCN literature.

Findings: The conceptual framework expands the network perspective in the SSCM context by considering the important role of the SCN structure in the firm’s decision-making process. Four factors (dependency, distance, power, and transparency) were found that are useful in conceptualizing the SCN structure. The conceptual framework also categorizes various sustainability practices into four RMS (noncompliance, transactional, dictatorial, and collaborative), which are needed to make an SCN more sustainable. In addition, 16 propositions are developed based on how firms may identify the most effective RMS to implement appropriate sustainability practices through examining their SCN structure.

Research limitations/implications: The conceptual framework, developed as a result of a comprehensive review of the literature, led to the development of 16 propositions, which can assist in furthering a research agenda on RMS to diffuse various sustainability practices within SCN structures.

Originality/value: The relationship between SCN structure and RMS in the sustainability context remains an under-researched but emerging area of interest. This paper leverages existing research to develop a conceptual framework suitable for empirical testing.     

All-pay war

We study a model of conflicts and wars in which the outcome is uncertain not because of luck on the battlefield as in standard models, but because countries lack information about their opponent. In this model expected resource levels and production and military technologies are common knowledge, but realized resource levels are private information. Each country decides how to allocate its resources to production and warfare. The country with the stronger military wins and receives aggregate production. In equilibrium both comparative and absolute advantages matter: a larger resource share is allocated to warfare by the country with a comparative advantage in warfare at relatively low realized resource levels, and by the country with an absolute disadvantage in warfare at relatively high realized resource levels. From an ex-ante perspective the country with a comparative advantage in warfare is more likely to win the war unless its military potential is much lower.     

Fading attraction: Turkey's shifting relationship with the European Union

In this paper, we examine Turkey's changing economic relations with the European Union (EU) and the rest of the world during the past few decades. We argue that a combination of the EU's reluctance to accept Turkey as a member, internal economic and political developments, and the rise of economic and political opportunities elsewhere have shifted the country to diversify its economic relations around the world and reduced its reliance on the ties with Europe. This shift, which had started long before the 2008 global financial crisis and accelerated in its aftermath, seems to have helped Turkey weather relatively well the recent economic storms in Europe.     

巴菲特退出了,你呢?

"股神"巴菲特卖出中国股票的做法显然并未博得所有人的认同。前不久,巴菲特将仍有很大获利后劲的中石油股票脱手的举动引起外界的极大关注。上周他在中国对媒体表示,投资中国股票的人应保持谨慎。     

Do more ethnically and religiously diverse countries have lower democratization?

The effects of diversity on democratization are investigated here. Ethnic fractionalization and polarization do not seem to affect democratization significantly, whereas religious fractionalization and polarization do affect democratization; countries with higher religious diversity experienced more democratization in the 1990s.     

Malmquist indices of productivity growth for Islamic and conventional banks in Malaysia

This paper studies the total factor productivity （TFP） of banks in Malaysia with the emphasis on comparing the relative productivities of Islamic and Conventional banks. The Malmquist index approach is used to decompose productivity growth into technical efficiency and technological change. The productivity growth is measured and decomposed into technical change and efficiency change. The efficiency change is further decomposed into pure efficiency change and scale efficiency. It is found that Islamic banks＇ productivity growth is limited by its lack of technological change compared to its conventional counterparts. Nonetheless, both types of banks are operating at the correct level in terms of scale or size.     

Determinants of dividend payout and dividend propensity in an emerging market,Iran: an application of the LASSO

Accurate prediction of dividends is important for market participants such as investors, firm managers, and monitoring authorities, as they can, respectively, invest, manage dividend decisions, and monitor dividend policies more effectively. We identify the most relevant variables for predicting the dividend payout of the firms in an emerging market, Iran, using the least absolute shrinkage and selection operator (LASSO). The advantages of the LASSO include: enhancing the prediction accuracy of the dividend model, improving interpretation of the results, and applicability to high-dimensional data. We obtain several results. First, some fundamental determinants of dividends in the industrialized economies such as market-to-book ratio and current ratio, do not play a role in deciding dividends in Iran. Second, LASSO-selected variables outperform the variables commonly used in the literature in terms of model fit and prediction accuracy. Third, business risk, leverage, return on assets and effective tax rate are the most important predictors of dividend propensity of the Iranian firms. Fourth, if the support vector machine algorithm, an often-used classification method, is combined with LASSO-selected variables, it can better discriminate between dividend-paying and dividend non-paying firms than other methods such as logistic regression and linear discriminant analysis.

Abbreviations: LASSO: Least Absolute Shrinkage and Selection Operator; TSE: Tehran Stock Exchange; RMSE: Root Mean Squared Errors; MAE: Mean Absolute Errors; ROC: Receiver Operating Characteristics; GMM: Generalized Method of Moments; MENA: Middle East and North Africa region; AIC: Akaike Information Criterion; BIC: Bayesian Information Criterion; LARS: Least Angel Regression; OLS: Ordinary Least Squares; AUC: Area Under Curve; BS: Brier Score ; OA: Overall Accuracy; LDA: Linear Discriminant Analysis; SVM: Support Vector Machine algorithm; LR: Logistic Regression.