Ownership dispersion as a second-best counterstrategy against monopoly

A literature on second-best pricing as counterstrategy against monopoly has evolved in economics. The purpose of this paper is to demonstrate that ownership dispersion through forced divestiture can be more effective in restricting the social damage of monopoly. Economists generally hold an ordinal view of utility. To the extent that the second-best literature suggests the possibility of reducing dead-weight loss through counterpricing, most economics would accept counterpricing as welfare increasing and reject ownership dispersion. The example presented in this paper suggests that this mindset may cause us to overlook promising alternatives.     

Utilization of SFAS No. 14 disclosures in assessing operating risk

This paper examines the usefulness of segmental disclosures required by SFAS No. 14 in assessing the operating risk of the firm. It is shown that the segmental asset data required by SFAS No. 14 is theoretically linked to an assessment of operating risk. In addition, an empirical investigation is conducted to examine whether this new disclosure was material enough to cause a reassessment by market participants of the operating risk of the affected firms. Segmental disclosure policy implications of the findings of this study are also discussed.     

Product development in the chemical industry: A description of a maturing business

To help us understand the massive complexity of the chemical industry, Robert A. Linn breaks it down into product/market sectors that show differing business requirements, and hence, differing new product development requirements. This is an important industry that has struggled through the 1970s with sharp changes in external pressures and very little technological excitement. Where are the new product opportunities in an industry such as this? How do you pursue them? On the basis of his years of experience in the industry, Linn offers some suggestions and some challenges for managers.     

Significant Issues for the Future: Some Additional Perspectives

The rational elements of management dominated the questions raised by our Editorial Board members in the previous issue of JPIM when they offered their ideas in, "Significant Issues For the Future of Product Innovation." In this article, the discussion is continued with some other Board members but this time the human side of managements gets its due attention. The issues presented here add to the picture of complexity that is the reality of product innovation but they also may provoke the thinking that can lead to an improvement in management performance.     

The effectiveness of electric utility price regulation in the 1970s a stochastic dominance analysis

This paper examines whether electricity price regulation in the United States has been effective during the period January 1969 through December 1977. Because our analysis provides evidence suggesting that the price-setting system has been ineffective, we extended our study to examine the equability among regulated firms as well as the relationship between firms' asset size and return distributions. These latter examinations shed some light on the quality of the accounting information set, which serves as a major input to the price-setting process.     

Corporate Governance Reforms: Redefined Expectations of Audit Committee Responsibilities and Effectiveness

Comprehensive regulatory changes brought on by recent corporate governance reforms have broadly redefined and re-emphasized the roles and responsibilities of all the participants in a public company’s financial reporting process. Most notably, these reforms have intensified scrutiny of corporate audit committees, whose role as protectors of investors’ interests now attracts substantially higher visibility and expectations. As a result, audit committees face the formidable challenge of effectively overseeing the company’s financial reporting process in a dramatically changed – and highly charged – corporate governance environment. This paper discusses the new expectations of audit committee responsibilities and effectiveness in the wake of corporate governance reforms, key challenges, “whistleblower” provisions and shortcomings, and provides some directions for future research.     

Making the Big Leagues: Factors Contributing to Publication in Elite Economics Journals

Publication in the best journals of ones discipline is for many the equivalent of making the big leagues in sports or performing at Carnegie Hall in the arts. Using individual-specific data collected from 704 economists, this study provides a multivariate analysis of the factors which contribute to publication in top economics journals. By examining only publications in elite journals, the analysis avoids pitfalls associated with weighting the quality of a wide array of journals while maintaining an emphasis on the determinants of excellence in scholarship. Empirical results indicate that many factors impact elite journal publication, including the quality of graduate education, collaboration with colleagues, presenting at professional conferences, teaching commitments, and service work.