A Pragmatist Defence of Classical Financial Accounting Research

One reason for the disdain in which classical financial accounting research has come to held by many in the scholarly community is its allegedly insufficiently scientific nature. While many have defended classical research or provided critiques of post‐classical paradigms, the motivation for this paper is different. It offers an epistemologically robust underpinning for the approaches and methods of classical financial accounting research that restores its claim to legitimacy as a rigorous, systematic and empirically grounded means of acquiring knowledge. This underpinning is derived from classical philosophical pragmatism and, principally, from the writings of John Dewey. The objective is to show that classical approaches are capable of yielding serviceable, theoretically based solutions to problems in accounting practice.     

Consolidation in a wildlife tourism industry: the changing impact of whale shark tourist expenditure in the Ningaloo coast region

In this paper, we examine the expenditure of whale shark tour participants at Ningaloo Marine Park, Western Australia; the location of the world's first whale shark tourism industry, established in 1989. We demonstrate that in 2006, participants' expenditure in the region was $894 per trip, total expenditure was $6.0 million (all figures are in Australian dollars), and between $2.4 and $4.6 million would have been lost to the region if whale shark tourism did not exist. Our measure of participants' expenditure is substantially lower than the calculation of $2370 per participant from a previous study of whale shark tourists using data collected in 1995. We argue that this is consistent with a change in the types of wildlife tourists that participate in an activity as the industry reaches the point of consolidation. Our results also suggest that using old data to forecast wildlife tourists' expenditure needs to take into account the industry's stage of development. Copyright © 2009 John Wiley & Sons, Ltd.     

Does complex hydrology require complex water quality policy?

Nonpoint‐source water pollution is frequently considered intractable because it is hard to regulate large numbers of small sources and because the science associated with assessing the impact of each source is complex. New Zealand has demonstrated that it is possible to implement a simple cap‐and‐trade system to help reduce nitrogen leaching from many small farms and thereby protect water quality. This paper relates to the second challenge: are complex regulatory systems worthwhile when nitrogen delivery is complex? When nitrogen moves through groundwater to a lake, leaching from different farms reaches the lake at different times and the damage caused is temporally differentiated. Policy that regulates farmers according to the timing of their nitrogen delivery will be more complex than policy that does not. Whether the gain in efficiency justifies this additional complexity can be assessed through modelling. We use an integrated model to estimate the gains from complex nitrogen regulation that incorporates groundwater delivery times relative to simple nitrogen regulation that does not. We find that the gains from more complex regulation are small in the catchment we study and cannot justify the additional complexity required. A sensitivity analysis enables us to identify the types of catchments where complex regulation may be worthwhile.     

Technology Shocks or Coloured Noise? Why real-business-cycle models cannot explain actual business cycles

It is one of the objectives of this paper to respond to the self-proclaimed superiority of the new institutionalists over the old. New institutionalists have found little of value in the old, largely dismissing its approach and its concerns in favour of a more purely individualistic approach and one emphasizing invisible-hand and evolutionary processes. Nevertheless, it is the argument of this paper that in terms of the development of an adequate treatment of institutions it is far from obvious that the NIE, if it remains so narrowly constituted, can provide more than a part. The emphasis of the OIE on particular institutional histories, collective decision-making processes, and institutional failures retains its place, even in the face of the self-assured assault of the new.     

The Subsequent Market Value of Former REO Properties

In this study, we find the subsequent price for a property initially sold as a real estate owned (REO) property occurs at market prices. The subsequent price to the REO purchaser is related to indicators that the property has been remodeled, renovated, or updated. This suggests that the difference between the price received by servicers/lenders that foreclose and sell a REO property, and the price received by subsequent property owners that sell is in large part due to timely improvements made postforeclosure. Lenders are not selling REO properties at irrational prices, but rather at prices that reflect the condition of the properties.     

Tariffication of a Distorted Economy: A CGE Analysis

This paper examines the consequences of the tariffication of a quota when there are several potential distortions present in a country, including domestic monopoly and wage rigidities. It is generally presumed that tariffs are superior to quotas because of their transparency and revenue-raising attributes. However, in the presence of multiple distortions, liberalization of a single policy instrument may result in net welfare losses. The findings suggest that, in a general equilibrium context, such a liberalization policy will have ambiguous effects upon aggregate domestic welfare in the country undertaking the tariffication.     

Assessing the effect of government surveillance on firm supererogation: The case of the U.S. automobile industry

This study builds on prior research investigating the antecedents of firm supererogation. Examining vehicle recalls in the U.S. automobile industry from 1966 to 2010 reveals that surveillance‐based government enforcement programs can have widespread industry effects on a specific type of supererogatory action, firm volunteerism. Specifically, increases in government surveillance are associated with firms going beyond what is legally required of them by initiating voluntary product recalls for defects not covered in existing government regulation. Such effects are shown to be unique among surveillance efforts as other government enforcement activities, such as standards‐based regulation, are revealed to have a negative association with firm supererogation.     

Empirical Evidence on Shareholder Value and the Sale-Leaseback of Corporate Real Estate

This study examines the valuation effect of the sale-leaseback of corporate real estate on the stock prices of the selling and purchasing firms. The issue tested is whether the sale-leaseback transaction offers a net benefit to the corporate seller/lessee or purchaser/lessor. The empirical evidence suggests that the sale-leaseback of corporate real estate has substantial benefits for the seller/lessee common stockholders. Additionally, the sale-leaseback transaction produces an insignificant loss for the corporate purchaser/lessor.     

Quality &; Time-on-the-Market in Residential Markets

We empirically examine Taylor’s (1999) theoretical prediction that longer time on the market is associated with a perception of lower quality. Our most robust result is from an ordered-logit model that provides evidence that an increase in marketing time is negatively related to property quality. Results from a time on the market duration model indicate that higher quality properties take less time to market and lower quality properties take longer to market relative to a typical property in the sample. We also estimate a probit model that indicates higher quality properties are more likely to sell and lower quality properties are less likely to sell. The empirical results from the models support Taylor’s theoretical model predictions that buyers perceive a longer time on the market as a signal of poor quality or the presence of a defect and thus, properties that remain on the market longer have a lower probability of selling.