Semantics and capital market efficiency: Testing the market's reaction to the naming of stock distributions as splits or dividends

The AICPA and NYSE urge corporations to avoid the term “stock dividend” and use the term “stock split” when referring to large common stock distributions. Theoretically these large distributions do not convey any economic value to the stockholders. Therefore a rule was considered necessary so as not to mislead them as to the actual nature of the distributions. The purpose of this study is to examine security price reactions to the differential naming of these distributions. The results strongly suggest that security returns are not differentially affected by naming a large common stock distribution a stock dividend rather than a stock split. That is, the capital market appears to be semantically efficient between terminologies.     

Voting patterns of big eight representatives in setting accounting and auditing standards

The “Big Eight” accounting firms are alleged to dominate the setting of accounting and auditing standards. This paper identifies the recent criticisms and reviews the standard setting procedures of the APB, FASB, and the ASB. The results of five empirical studies designed to investigate the alleged domination issue are summarized. The conclusion drawn is that there is no empirical evidence to indicate that the Big Eight collectively govern the accounting and auditing standard-setting process.     

Carryover effects of advertising on sales of durable goods

In a landmark paper, Clarke [Clarke, D.G., J. Marketing Res. 13 (November 1976): 345–357] addressed the question of how long the carryover effect of advertising on sales persists. Appropriate cautions are included in the conclusions reached by Clarke since the preponderance of studies that he reviewed involved mature frequently purchased low-priced products. His conclusion is that, for such products, the carryover effect of advertising lasts a matter of months rather than years. The current study examines durable goods and provides preliminary evidence that for some durables, advertising effects may have a duration interval that exceeds a year.     

A framework for analyzing money stock control under the Monetary Control Act

This paper analyzes the money stock effects of the Monetary Control Act (MCA) under a nonborrowed reserve (NBR) operating procedure. Prior to the passage of the MCA, policy was conducted under an interest rate operating target where reserve requirement reforms such as those introduced by the MCA had little influence on money stock variability. Under an NBR procedure however, the structure of reserve requirements may have a significant impact on monetary control. Our analysis indicates that the relative improvement in monetary control greatly depends on the degree of tightness exercised by the Federal Reserve over total reserves in an MCA regime. The tighter the control, the more significant the estimated monetary control benefits of the MCA under an NBR procedure.     

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.     

The medical expense deduction and income levels: Progressive or regressive?

The medical expense deduction (MED) allows taxpayers to deduct from taxable income a proportion of their out-of-pocket medical insurance and health care expenses. Because the rate of subsidy is equal to the marginal tax rate previous studies have found MED to be a regressive tax mechanism biased toward benefiting higher-income taxpayers. The authors demonstrate, using GINI coefficients, that MED makes the tax structure more progressive than it would otherwise be and increases equality of after-tax incomes.     

Sales expectations and inventory changes in retail trade

In this paper a single equation inventory investment model is estimated for the United States retail sector. Monthly data for the 1970s are utilized. In estimating the model it is alternatively assumed that expectations were formed according to a seasonal model, to perfect foresight, and to a narrowly rational expectations model. We find that a model in which expected sales and the expected rate of inflation are narrowly rational can explain most of the variation in retail inventory investment during the time period studied. The results of the estimation imply that retailers have a relatively short forecast horizon, that they can react quickly to either unexpected sales or to a deviation of actual from desired inventory stocks, and that an increase in the real of interest has a statistically negative impact on retail inventory investment.     

Heavy,medium, light shoppers and nonshoppers of a used merchandise outlet

An unsettling economic future coupled with changes in social values indicate that preowned merchandise buying will become increasingly evident. Consumers face the prospects of inflation, unemployment, and shortages, while social values are shifting away from disregard of resource usage by the disposable society. Buying preowned merchandise is a solution to coping with the environmental changes. Although institutions selling used merchandise, like other retailers, require factual information to design effective marketing strategies, this remains a neglected retailing phenomenon.The purpose of this study was to gain insights concerning several aspects of preowned merchandise buying using Goodwill Industries as a case in point. Data were collected to provide demographic profiles of heavy, medium, and light shoppers and nonshoppers, the information sources effective in inculcating awareness, basic patronage motives of heavy, medium, and light shoppers, and various buying behavior patterns of the four groups. The latter included shopping at Goodwill versus other institutions selling used merchandise, future shopping plans at Goodwill, overall attitude toward used merchandise, and the types of preowned merchandise they would be willing to purchase.Telephone interviews were made with a randomly selected sample of household representatives living in a midwestern standard metropolitan statistical area (SMSA) with a population of 85,000. The 336 respondents (97.5% of the sample) who were aware of Goodwill formed the initial data base from which 320 usable questionnaires were obtained. A composite shopping volume index was used to differentiate light, medium, and heavy shoppers as well as nonshoppers.Results from the study show that some differences exist between the groups in terms of demographics, information sources, and patronage motives as well as part and anticipated shopping behavior. Several implications are suggested for Goodwill in particular and similar organizations in general.     

Of lessees,lessors, and discount rates and whether pigs have wings

Recent articles on leasing suggest five principles that should aid analysts to understand this durable, much misunderstood financial instrument. The principles are 1) the lessor must be happy too, 2) the operating inflows have nothing to do with the case, 3) financial, like physical, matter tends to be preserved, 4) debt is a function of after-tax flows, and 5) inability to use tax shelters cuts two ways. In this paper we illustrate these principles and use illustrations to demonstrate that each of these principles has merit. We argue as well that the impression, often left by the principles, that leasing seldom benefits all parties to the transaction is incorrect.     

建设抚—哈合作开发区的设想

抚远县和一江之隔的哈巴罗夫斯克市及其周围地区,以其优越的地缘优势、资源优势和互补性,具有发展双边(多边)经济技术合作的广阔前景。建设抚哈合作开发区,不仅有利于振兴当地经济,而且可作为参与东北亚国际分工与合作的窗口,通过外参内联,实现由边疆到内地,由双边到多边的多种形式的经贸合作,带动和促进两国内地经济的发展。