Assessing credit quality from the equity market: can a structural approach forecast credit ratings?

We investigate the empirical performance of default probability prediction based on Merton's (1974) structural credit risk model. More specifically, we study if distance‐to‐default is a sufficient statistic for the equity market information concerning the credit quality of the debt‐issuing firm. We show that a simple reduced form model outperforms the Merton (1974) model for both in‐sample fitting and out‐of‐sample predictability for credit ratings, and that both can be greatly improved by including the firm's equity value as an additional variable. Moreover, the empirical performance of this hybrid model is very similar to that of the simple reduced form model. As a result, we conclude that distant‐to‐default alone does not adequately capture the firm's credit quality information from the equity market. Copyright © 2007 ASAC. Published by John Wiley & Sons, Ltd.     

公司资本维持原则与解决企业筹资困境的制度与立法争议

资本维持原则普遍采取“票面金额”制和禁止折价发行等股票发行制度。但这一原则制度在实践中也存在着种种制度和立法争议，并经常导致公司筹资困难，从而违背了它原来的立法初衷。从历史和现实的比较情况看，允许公司采用“低面额股”的股票发行制度将是解决资本维持原则的制度和立法争议的最佳措施，既便利公司筹资，又使债权人的利益最终受到保护。     

TOURISM CRISIS MANAGEMENT: US Response to September 11

Policymakers are faced with the predicament of if and how they should respond to an unexpected and sudden downturn in tourism demand. In the past, they have made these decisions in the absence of research into the relative effectiveness of different responses. The downturn in the United States following September 11 is a particularly vivid example of tourism crisis. This paper analyzes the effects of this crisis using a computable general equilibrium model of the US and also examines potential and actual policy responses to the crisis. Sector-specific targeted subsidies and tax reductions are found to be the most efficient means of handling the situation.     

Adoption of the Balanced Scorecard: A Contingency Variables Analysis

Our study investigates the adoption of the Balanced Scorecard (BSC) as a strategic planning system. We empirically examine the firm‐level factors—business‐level strategy, firm size, environmental uncertainty, investment in intangible assets, and prior performance— that are posited to differentiate BSC adopters from nonadopters. Drawing on a sample of Canadian firms and utilizing both survey and archival data, we find that BSC adopters (a) are more likely to follow a Prospector or Analyzer business strategy, (b) are significantly larger, (c) exhibit significantly higher environmental uncertainty than nonadopters, and (d) have weaker prior performance. Copyright © 2011 ASAC. Published by John Wiley & Sons, Ltd.     

How User‐Created‐Content (UCC) Service Quality Influences User Satisfaction and Behaviour

The Internet is undergoing a gradual shift from Web 1.0‐based user interaction to Web 2.0, which has a greater emphasis on user‐created content (UCC) and user collaboration (Hsu & Hsu, 2008). Since existing models of e‐service quality are likely deficient under Web 2.0, we build on them and test a new framework using 319 users who frequented UCC websites. Among other findings, three service elements together explained 44% of the variance in user satisfaction and 33% of the variance in website usage. These elements were: the provider‐user relationship (customization and participation), the relationship among users (e.g., user empowerment), and user compensation. Copyright © 2012 ASAC. Published by John Wiley & Sons, Ltd.     

Exactitude des coefficients de pondération de multiples indicateurs avancés de rendement : incidence sur le rendement et les connaissances des gestionnaires

De nombreuses sociétés qui utilisent de multiples indicateurs avancés de rendement ne valident pas le modèle causal qui relie ces indicateurs aux résultats financiers futurs, et les relations de cause à effet du modèle sont souvent abandonnées aux estimations subjectives qui peuvent être sujettes à l’erreur. En procédant à une expérience, l’auteure examine comment l’exactitude des hypothèses au sujet de la pondération des indicateurs avancés dans un modèle causal influe sur le rendement et les connaissances des gestionnaires, lorsque lesdits gestionnaires se voient offrir la possibilité d’apprendre au fil de plusieurs périodes. Les résultats obtenus montrent que le fait que des coefficients de pondération inexacts soient affectés aux indicateurs avancés améliore le rendement, réduit la fluctuation du rendement et enrichit les connaissances, comparativement à l’absence de coefficients de pondération. En outre, le rendement est semblable, peu importe que les coefficients de pondération soient exacts ou inexacts, alors que les connaissances sont meilleures lorsque les coefficients de pondération sont inexacts que lorsqu’ils sont exacts, ce qui ne confirme en rien les effets de polarisation des coefficients de pondération inexacts. Les observations résultant de l’étude semblent indiquer qu’à tout le moins dans certaines circonstances, les gestionnaires tirent avantage des coefficients de pondération affectés aux indicateurs avancés, même lorsqu’ils sont inexacts, et sont en mesure de corriger ces inexactitudes pour parvenir à un niveau comparable de rendement et de connaissances, comme s’ils avaient disposé de coefficients de pondération exacts.     

An international travel Demand model US Travel to Western Europe

This paper examines international travel demand between the United States and Western Europe. A complete system of demand equations is estimated to obtain expenditure and price elasticities of the demand for travel. The results allow the classification of regions of Western Europe as substitutes or complements according to the preferences of travelers. It is found that Americans view Norway, Sweden, Denmark, Spain, and Portugal as “luxury destinations” that might expect to receive an increasing share of the traveler's budget. The price elasticities are relatively low for France, Belgium, the Netherlands, and Luxembourg. France and the U.K eexhibited high price substitution effects as did France and Germany. Travel to most other countries might be classified as complementary with respect to travel to France and substitutes with respect to the U.K.     

Wives' involvement in tourism decision processes

This study segments tourism decision-making tasks into 17 categories. Wives were asked to assign a score to their level of involvement in each task. A marginal involvement in tasks related to the “financing aspects” of the trip was observed whereas involvement was high in tasks such as “shopping”, “selecting restaurants”, “collecting information”, and “preparing luggage”. Two hypotheses were tested: the socioeconomic characteristics of wives and trip characteristics have a positive effect on the level of involvement in the tourism decisions; and levels of task involvement are consistent for the 17 tasks (stability in tasks involvement). Marketing implications and recommendations for future research were also discussed.

Résumé

La participation des épouses aux décisions de voyages. Cette étude segmente les décisions et taches des voyages en dix-sept catégories. On a demandé aux épouses d'attribuer une valeur numérique selon leur niveau de participation dans chaquetâche. On a observé peu de participation aux “aspects financiers” tandis que la participation était élevée pour le “shopping”, le “choix des restaurants”, la “collecte d'information”, et la “préparation des bagages”. On a vérifié deux hypothèses: que les caractéristiques socio-économiques des épouses ainsi que certaines caractéristiques du voyage ont un effet positif sur la participation des épouses aux décisions du tourisme, et que les niveaux de participation pour les dix-sept tâches sont stables. On discute aussi des implications de marketing et des recommandations pour la recherche future.     

CVS/Caremark: The Costs and Strategy of a Tobacco‐Free Pharmacy

This instructional case presents CVS/Caremark's decision to discontinue tobacco sales at its U.S. pharmacies effective October 1, 2014. The case provides data on the strategic issues underlying the decision and examples of the nonfinancial factors that affect product‐line decisions. The case illustrates the use of the broad array of costs in management decision making, including hidden costs, contingent costs, reputational costs, and social costs. It also provides data to explore the decision from the perspective of customer profitability analysis and the differential costs of serving tobacco customers compared with general retail customers.     

A Personal View of the Evolution of the Accounting Professoriate

The first three‐quarters of this paper are a review and analysis of the evolution of the accounting research environment, primarily in the United States but also with respect to Canada, from the 1960s to the present time. The final quarter of the paper consists of a critique of contemporary approaches to accounting research as well as recommendations for reform.