Structure and Ownership of East German Enterprises

This paper investigates the process by which East German enterprises have been privatized and their resulting ownership and control structure. A corporate system with a very high level of concentration of ownership has been created. This is particularly closely associated with ownership and direct control by West German companies. The paper argues that this has allowed East German enterprises to gain access to finance, markets, and managerial skills which they might otherwise have been denied. The resulting "insider" system of corporate control will over time allow East German companies to participate in the control of their own and West German companies. The Treuhandanstalt has organized the privatization process to achieve certain industrial and social objectives. It has broken up the large multiplant enterprises to an extent that East German enterprises are now smaller than their West German counterparts. It has used informal liquidations rather than formal bankruptcies to be able to achieve its objectives. Privatizations have not involved the flotation of companies on the stock market. Instead, the Treuhand has arranged share and asset transfers on a scale which is in excess of merger activity commonly observed in the West. J. Japan. Int. Econ., Dec. 1995, 9(4), pp. 426–453. University College London, Wissenschaftszentrum Berlin, and CEPR; Oxford University and CEPR     

Will East Germany Become a New Mezzogiorno?

Despite massive regional policy efforts, GDP per capita in Southern Italy has only briefly converged on Northern Italian levels in the 1960's. Failure of convergence since then is associated with a policy switch from investment toward income maintenance, with reduced wage sensitivity to regional labor market conditions and with increases in rent-seeking opportunities and corruption. East Germany's early experience of rapid wage and income, but not productivity, convergence raised fears that aMezzogiornoscenario could be repeated. Since then, however, investment and productivity have risen while wage setting has become more flexible. Given East Germany's greater “social capability” for growth, and provided that investment continues to be encouraged, the prospects for convergence are now more promising.J. Comp. Econom.,June 1997,24(3), pp. 241–264. Magdalen College, University of Oxford, Oxford OX1 4AU, United Kingdom; University College London, London WC1E 6BT, United Kingdom; and School of Oriental and African Studies, University of London, London WC1H 0XG, United Kingdom.     

Twenty-fifth international atlantic economic conference April 16–22, 1988 London,England

Twenty-fifth international atlantic economic conference April 16–22, 1988 London, England     

Trading cost expectations: Evidence from S&P 500 index replacement stock announcements

This paper tests the effect on stock value of an expected change in future trading costs. The capitalized value of a reduction in trading costs is hypothesized to increase the stock value, a trading cost effect. Improved liquidity reduces trading costs. Inclusion as an S&P 500 Index replacement stock is an event hypothesized to increase liquidity. We use 114 observations between January 1, 1983 and October 12, 1989 of stocks added to the Index as replacements for stocks removed. The abnormal return of each stock is regressed against the ratio of the bidask spread to the price of the stock, the change in trading volume of the stock, and the open interest in the Index futures contracts at the close of the month prior to the replacement announcement. We find that the positive abnormal returns for replacement stocks are related to increased daily trading volume after inclusion in the Index. Further, the trading cost effect is proportional to percentage bid-ask spreads prior to inclusion. The trading cost effect increases as trading in derivatives of the Index increases. The volume and stock price changes after replacement are not transitory, indicating an improvement in liquidity. Three alternate hypotheses suggested in prior research to explain the abnormal returns for replacement stocks are tested. Testing each of the three models previously considered: price pressure, inelastic demand curves, and information, we find that none can be accepted with statistical confidence. The abnormal returns of Index replacement stocks are consistent with rational pricing of an anticipated reduction in future transaction costs. This anticipated reduction is capitalized in the value of the stock at the time of the replacement announcement. These results are consistent with a trading cost effect.     

Brand choice and varying quantity of information

The research reported here examines the impact of varying information on brand choice decisions and the relationship between brand choice and consumers' confidence, satisfaction, and the assumptions they make about undisclosed information.     

Developing Inclusive Communities of Learners in Technology Education: Practical Craft Skills - Facilitator or Hindrance

This paper examines the rationale for the Woodworking Skills section of a course on Practical Craft Skills which forms part of the new technology curriculum in Scottish Schools. Introduced with the intention of making technology subjects more accessible to a wider range of pupils, the subject has potential for contributing to a more inclusive environment in secondary schools. The practical nature of the subject, moreover, should, in theory at least, have been able to contribute particularly well to the development of a community of practice (Wenger, 1998).In education, however, practice does not always reflect theory nor reality reflect the rhetoric. This paper examines the assumptions underlying the pedagogy and assessment methods outlined in the rationale for the subject in relation to current theory and concludes that a valuable opportunity for creating an inclusive community of learners has been missed. Whilst the paper focuses on the Woodworking Skills area of the course, other areas reflect a similar framework.     

Initial Steps in High-Frequency Modeling of China

This paper presents the first step in building a forecasting model of Chinas GDP. Being constrained by a statistical history that effectively begins in 1993, it uses high frequency data and principal components analysis to construct a single-equation model that generates elasticities and is applied to two-quarter-ahead forecasts. Initial results suggest a gradual deceleration of growth, consistent with Chinese government policy.A version of this paper was presented as part of Lawrence R. Kleins Adam Smith Award Address at the NABE Annual Meeting, October 4, 2004. The Adam Smith Award Address was sponsored by Global Insight.JEL Classification C5,O53     

ACCOUNTABILITY AND GOVERNMENTAL FINANCIAL REPORTING

Accountability is the cornerstone of Governmental Generally Accepted Accounting Principles (GGAAP) in the United States according to the Governmental Accounting Standards Board (GASB). This paper analyzes the implications of alternative definitions of the concept of accountability for GGAAP and for GASB. It also discusses the costs and benefits of accountability information, the effect of diverse users of governmental reports, and alternative mechanisms for achieving accountability in governments. Finally, a governmental accounting research agenda based on accountability is proposed for the future.     

Domestic Content and Compensatory Export Requirements: Protection of the Motor Vehicle Industry in the Philippines

The motor vehicle industry in the Philippines is protected bya virtual embargo on the importation of new vehicles but operatesunder the burden of domestic content and compensatory exportrequirements that protect Philippine producers of automotivecomponents. This article develops a model to assess the netimpact of this complicated protective regime. Estimates indicatesubstantial benefits to the assembly and components industriesand losses to vehicle purchasers. Reform of the system to eliminatethe embargo as well as the domestic content and compensatoryexport restraints at current tariff rates would benefit vehiclepurchasers but would increase the effective rate of protectionto assembly operations by decreasing prices of components. Reformmeasures to eliminate the domestic content and compensatoryexport requirements should be accompanied by simultaneous reductionsin tariffs on assembled vehicles.     

Addressing Issues Relating To Going-Gongern Audit Qualifications And Corporate Failure

This study examines the incidence of going-concern audit qualifications and of corporate failure for Australian publicly listed companies over the period 1980-90. The analysis includes a review of annual reports for companies that attracted going-concern qualifications but did not subsequently fail, in order to identify potential indicators of survival. The differences between the indicators noted for failed companies that had their last accounts qualified on the basis of going concern, and those of failed companies not qualified, was also examined. Other issues of interest include a comparison of going-concern qualifications by Big Eight (Six) and other audit firms, and the extent and location of disclosure of going-concern problems in the annual report.