‘The Navigator Network’: a New Zealand futurewatch case study

New Zealand's ‘Navigator Network’ is a national scanning network of scientists and policy analysts providing ‘early alert’ advice about emerging areas of science and technology. It was established by the Ministry of Research, Science and Technology (MoRST) to enhance the government's readiness to respond to the opportunities and risks around new technologies, particularly in biotechnology and nanotechnology. The Navigator Network has been tailored to the New Zealand context, which is characterised by a small, well-connected government sector and a strong focus on agricultural biotechnology and food. The network builds on these features, and is ‘people-centric’ rather than ‘information-centric’, using dialogic approaches to generate new knowledge between diverse stakeholder groups. It also focuses on building futures capability in the government and science sectors. Representatives from government agencies are integrated into the process as scanners to facilitate uptake. It also has an adaptive development process via an action learning component.     

PCAOB inspection reports and audit quality

With the creation of the Public Company Accounting Oversight Board (PCAOB), audit firm oversight shifted away from self-regulation to independent regulation. The inspections program is the central feature of the PCAOB. We examine whether PCAOB inspections are able to distinguish actual audit quality (as opposed to perceived) during the period inspected to better understand this important regulatory tool. We use three measures that proxy for actual audit quality: abnormal accruals, restatements, and the propensity to issue a going concern opinion. For triennially inspected auditors, we find that PCAOB inspections are associated with lower audit quality when the reports are seriously deficient (weaker results for deficient reports). More specifically, we find clients of triennially inspected auditors that receive a deficient or seriously deficient report are associated with significantly higher abnormal current accruals and clients of auditors that receive a seriously deficient report are associated with a greater propensity to restate. Our evidence is subject to the caveat that PCAOB reports for triennially inspected auditors do not capture the going concern aspect of audit quality. For annually inspected auditors, the results are conflicting and suggest PCAOB inspection reports do not distinguish audit quality during the period inspected for annually inspected auditors.     

Application and Assessment of an Ethics Presentation for Accounting and Business Classes

This paper describes a presentation on ethics for accounting and business students. In 2001 and 2002, major corporate failures such as Enron and Worldcom, combined with questionable accounting practices, made ethics a paramount concern to persons working in business and accounting. While financial statement analysis and regulatory requirements are important technical topics, the issue of ethics provides faculty a unique and very appropriate setting to discuss deeper truths about doing business and living life well. This paper briefly describes the development and assessment of one approach to presenting ethics built around a computerized slide show (PowerPoint). The goal of the presentation is to increase students’ understanding of the essential role of ethics to accounting and business. Following the presentation, students indicated a heightened recognition of the importance of ethics. Educators should do all that they can to encourage students to do the “right” thing, even in difficult circumstances. This encouragement may serve them well in school and later in their careers.     

An Exercise To Explore The Future Impact Of New Technologies

New technologies have the potential to drastically change the way people and firms conduct business. But the future is difficult to predict, and the inherent uncertainty of a new technology's impact can be troubling. This article describes an exercise that has participants evaluate a 1937 U.S. Government sponsored technology forecast. The forecast identified thirteen inventions that were predicted to have a significant impact on society during the subsequent 10–25 years. These inventions included the television, facsimile machine, mechanical cotton picker, and trailer homes, among others. Participants in the exercise are challenged to evaluate the accuracy of the 1937 forecast, and develop and understanding of the issues inherent in predicting the future impact of new technologies. They are then challenged to identify today's new technologies, and make predictions regarding these technologies' future impact. Today's new technologies may change important aspects of everyday life over the next few decades, and significantly influence the competitiveness of certain firms. The exercise illustrates how difficult it can be to anticipate the future impact of new technologies. New technologies take time to develop, and most forecasts are overly optimistic regarding the rate of development and adoption. New technologies can also develop in ways not anticipated, and a new technology may have uses that are difficult to foresee. These challenges notwithstanding, it is still important to regularly track new technologies and attempt to anticipate their potential impact. The greatest danger comes not from having inaccurate predictions of the future impact of new technologies, but from having not thought about the potential impacts. The exercise was developed for use in an executive MBA program to encourage participants to think beyond the budgets and deadlines that drive much of their regular work activity. It was designed to challenge them to reevaluate whether they, and their firm, were thinking about how new technologies might impact their industry. The exercise has the greatest impact and applicability when conducted at corporate programs or with Executive MBA students, but can be used in a typical MBA or MS program as well. It can be conducted in a three‐four hour session, or over multiple shorter sessions. © 2002 Elsevier Science Inc. All rights reserved.     

Equalization and the Decentralization of Revenue–Raising in a Federation

We study federal economies in which regional governments have responsibility for delivering public services and redistributive objectives apply. The implications of these for the assignment of revenue–raising instruments and fiscal transfers, both vertical and horizontal, are considered. Models of heterogeneous regions of varying degrees of complexity and generality are constructed. For each case, we determine what fiscal instruments must be given to the regions and what intergovernmental transfers must be made in order that the social optimum is achieved. With heterogenous households and regions, the social optimum can be decentralized by making regions responsible for redistribution and implementing equalization transfers that depend on the number of households of each type.     

The WOW factor: Creating value through win-back offers to reacquire lost customers

Customer reacquisition provides firms with high financial and service improvement benefits. The implications of this research are meant to stimulate a new research stream towards a theory of customer reacquisition management as well as to provide service firms with a framework to regain defected customers. Through two studies, we develop an empirical model that identifies the factors driving win-back offer effectiveness. The findings indicate that, in order for win-back offers to be effective, service providers must consider a customer's reasons for leaving and their relationships with the current service provider. Value determinants (price and service benefits provided in the win-back offer), social capital and service importance play a prominent role in shaping customer switch-back intentions regardless of the level of previous satisfaction, regret, or delight with the new service provider.     

The welfare effects of restricted hospital choice in the US medical care market

Managed care health insurers in the USA restrict their enrollees' choice of hospitals to within specific networks. This paper considers the implications of these restrictions. A three‐step econometric model is used to predict consumer preferences over health plans conditional on the hospitals they offer. The results indicate that consumers place a positive and significant weight on their expected utility from the hospital network when choosing plans. A welfare analysis, assuming fixed prices, implies that restricting consumers' choice of hospitals leads to a loss to society of approximately $1 billion per year across the 43 US markets considered. This figure may be outweighed by the price reductions generated by the restriction. Copyright © 2006 John Wiley & Sons, Ltd.     

Agglomeration Effects and the Competition for Firms

A two-region economy consists of a given but different number of immobile workers in each region, and a given number of mobile firms. Firms create jobs where they locate, but there is frictional unemployment. Two sorts of agglomeration effects arise: those from economies of scale in matching, and those from production economies external to the firm. Regions may either be part of a unitary state in which case all regional policies are decided by the central government, or they may be part of a federal state in which case some policies are determined by the regional governments. We characterize the resource allocations in both a unitary and a federal state, and identify the set of instruments that are required to replicate the social optimum in each state.