How capital markets assess the credibility and accuracy of CSR reporting: Exploring the effects of assurance quality and CSR restatement issuance

This research examines how the credibility and accuracy of corporate social responsibility (CSR) disclosures enhance market confidence by exploring their effect on the cost of capital. How do capital markets react to higher-quality assurance of CSR reporting? Can the hypothetical reduction in the cost of capital that assurance quality produces be explained by restatements of previous information given in these CSR reports? We explore the relationship between assurance quality, as a proxy for credibility and market confidence, and the mediating effect of CSR restatements as indicators of accuracy. We propose regression models with a sample of CSR reports issued by European companies. Building upon the signalling and legitimacy theories, the results support the positive effect of higher assurance quality statements on market confidence by confirming a decrease in the cost of capital; assurance quality gives an indication of credibility to the capital market and restatements related to methodological updates signal accuracy. The reduction in the cost of capital brought on by higher assurance quality appears to be determined by the issuance of CSR restatements, which create legitimacy for both client companies and assurance providers. CSR reporting and assurance have reached a greater level of maturity as demonstrated by the evolution of these practices and financial market perceptions.     

Regional innovation and small high technology firms in peripheral regions

This paper highlights the difficulty of developing HT firms in a peripheral region of Spain. Although the endogenous development of HT firms in these regions is possible, their evolution depends on more central regions. The firm's geographical location and the type of HT production are the most important endogenous factors governing the firm's success.     

Bank Equity Investments: Reducing Agency Costs or Buying Undervalued Firms? The Information Effects

Abstract:   This paper analyses the relevance of two different reasons for banks to acquire firms' stock: the increase of agency costs in the lending relationship (the agency costs hypothesis), and participation in the expected profits of undervalued firms (the information asymmetry hypothesis). Results indicate not only that banks make equity investments for both reasons but also that the market exploits their lending decisions to learn which of the two motivations was in play. Bank equity investments concurrent with reductions in bank debt are consistent with the agency costs hypothesis, whereas bank equity investments concurrent with increases in bank debt are consistent with the information asymmetry hypothesis.     

On the Role of Weight Restrictions in Data Envelopment Analysis

This paper examines the role that weight restrictions play in Data Envelopment Analysis (DEA). It is argued that the decision to include a factor (input or output) in a DEA model represents an implicit judgement that the factor has a non-trivial weight. It therefore seems perverse to allow DEA to assign a trivial weight to that factor in assessing the efficiency of a unit. There is therefore a strong case for imposing restrictions on factor weights. However, many existing methods of weight restriction are in practice unwieldy. This paper proposes an alternative approach we term contingent weight restriction which is both practical and intellectually consistent with the DEA philosophy. The paper explores the implications of alternative methods of weight restriction using simulated data from a well known production process.     

Assessment of Interjudge Reliability in the Open-Ended Questions Coding Process

In the process of coding open-ended questions, the evaluation of interjudge reliability is a critical issue. In this paper, using real data, the behavior of three coefficients of reliability among coders, Cohen’s K, Krippendorff’s α and Perreault and Leigh’s I _r are patterned, in terms of the number of judges involved and the categories of answer defined. The outcome underlines the importance of both variables in the valuations of interjudge reliability, as well as the higher adequacy of Perreault and Leigh’s I _r and Krippendorff’s α for marketing and opinion research.     

Pseudo empirical likelihood method in the presence of missing data

In this paper, we propose an estimator for the population mean when some observations on the study and auxiliary variables are missing from the sample. The proposed estimator is valid for any unequal probability sampling design, and is based upon the pseudo empirical likelihood method. The proposed estimator is compared with other estimators in a simulation study.     

Reinforcing the Link Between Contributions and Pensions: The Effect of the Population Aging

In this paper, we analyze a majority voting process on the earnings-related part of pension benefits in a Social Security system with flexible retirement. We show that the aging of the population may make it easier to implement one of the proposed reforms to achieve a delay in the average retirement age of workers, to reinforce the link between contributions and pensions.     

The Study of Ethnicity and Nationalism Needs Better Categories: Clearing up the Confusions that Result from Blurring Analytic and Lay Concepts

Synopsis It has been difficult to make progress in the study of ethnicity and nationalism because of the multiple confusions of analytic and lay terms, and the sheer lack of terminological standardization (often even within the same article). This makes a conceptual cleaning-up unavoidable, and it is especially salutary to attempt it now that more economists are becoming interested in the effects of identity on behavior, so that they may begin with the best conceptual tools possible. My approach to these questions has been informed by anthropological and evolutionary-psychological questions. I will focus primarily on the terms ‘ethnic group’, ‘nation’, and ‘nationalism’, and I will make the following points: (1) so-called ‘ethnic groups’ are collections of people with a common cultural identity, plus an ideology of membership by descent and normative endogamy; (2) the ‘group’ in ‘ethnic group’ is a misleading misnomer—these are not ‘groups’ but categories, so I propose to call them ‘ethnies’; (3) ‘nationalism’ mostly refers to the recent ideology that ethnies—cultural communities with a self-conscious ideology of self-sufficient reproduction—be made politically sovereign; (4) it is very confusing to use ‘nationalism’ also to stand for ‘loyalty to a multi-ethnic state’ because this is the exact opposite; (5) a ‘nation’ truly exists only in a politician’s imagination, so analysts should not pretend that establishing whether something ‘really’ is or is not ‘a nation’ matters; (6) a big analytic cost is paid every time an ‘ethnie’ is called a ‘nation’ because this mobilizes the intuition that nationalism is indispensable to ethnic organization (not true), which thereby confuses the very historical process—namely, the recent historical emergence of nationalism—that must be explained; (7) another analytical cost is paid when scholars pretend that ethnicity is a form of kinship—it is not.