A market-consistent framework for the fair evaluation of insurance contracts under Solvency II

Decisions in Economics and Finance - The entry into force of the Solvency II regulatory regime is pushing insurance companies in engaging into market consistence evaluation of their balance sheet,...     

Organizational structure and earnings quality of private and public firms

Review of Accounting Studies - We examine how heterogeneity in organizational structure affects private firm earnings quality in the European Union. Organizational structure refers to whether the...     

Integrated bio-economic models as tools to support land-use decision making: a review of potential and limitations

Bio-economic modelling has become a useful tool for anticipating the outcomes of policies and technologies before their implementation. Advances in mathematical programming have made it possible to build more comprehensive models. In an overview of recent studies about bio-economic models applied to land-use problems in agriculture and forestry, we evaluated how aspects such as uncertainty, multiple objective functions, system dynamics and time have been incorporated into models. We found that single objective models were more frequently applied at the farm level, while multiple objective modelling has been applied to meet concerns at the landscape level. Among the objectives, social aspects are seldom represented in all models, when being compared to economic and environmental aspects. The integration of uncertainty is occasionally a topic, while stochastic approaches are more frequently applied than non-stochastic robust methods. Most multiple-objective models do not integrate uncertainty or sequential decision making. Static approaches continue to be more recurrent than truly dynamic models. Even though integrating multiple aspects may enhance our understanding of a system; it involves a tradeoff between complexity and robustness of the results obtained. Land-use models have to address this balance between complexity and robustness in order to evolve towards robust multiple-objective spatial optimization as a prerequisite to achieve sustainability goals.     

Easing the assessment of emerging technologies in technology observatories. Findings about patterns of dissemination of emerging technologies on the internet

This paper considers the Web as a big data container that can be used by Technology Observatories and administrations to track emerging issues and more specifically emerging technologies. It considers information that is available on the Internet for free from different sources, and proposes a framework that can be useful to characterise them and to detect patterns of dissemination. This framework is made up of 30 metrics obtained from different kinds of sources (general web, patents, scholars?…). Some of them are obtained directly as the number of hits retrieved by queries on a search engine, and other ones calculated by means of ratios. This paper contains the development of a complete case that utilises this framework to characterise emerging technologies included in the well-known Hype Cycle for Emerging Technologies, in this case the 2015 release¹ and to analyze patterns of dissemination of these technologies on the Internet.     

It is not a flat world after all: Tax repatriation costs and cash value

US corporations have accumulated record‐high amounts of cash, and most of it is trapped in foreign accounts. This study tests the hypothesis that the marginal value of cash decreases in the presence of tax repatriation costs, as these costs are a strong indication that part of the cash is trapped abroad. Cash abroad is not readily available to the company because it is subject to an additional layer of tax before it can be used or distributed. Moreover, uncertainty surrounds the potential use of foreign cash, and research documents that firms holding high amounts of cash abroad are likely to invest in negative net present value activities. Finally, possible changes in tax regulation are an additional source of uncertainty. Consequently, foreign cash should be worth less than domestic cash. Using a large sample of US firms drawn from COMPUSTAT during the 1991–2012 period, the analysis suggests that shareholders value an extra dollar of cash at $1.086. However, this result changes dramatically when the change in cash is interacted with the tax cost of repatriating the earnings. That is, the marginal value of cash decreases significantly in the presence of tax repatriation costs, and shareholders discount cash when it is likely to be held abroad. This study contributes to the literature on cash holding by investigating whether tax repatriation costs affect the value of corporate cash. Moreover, the findings show that there are important economic consequences linked to the phenomenon of cash accumulation in foreign countries and therefore provide regulators with a sound foundation on which to take additional actions to require more disclosure of and transparency in the actual location of firms’ cash holdings.     

Social and organisational implications of CAD usage: a grounded theory in a fashion company

This paper focuses on the process of Computer Aided Design (CAD) diffusion into a group engaged in the development of innovative products. Adopting an ethnographic approach, we build a grounded theory for interpreting CAD usage in terms of the interplay between variables such as management orientation, training, actors' specialisation and deskilling, availability of shared archives, technological discontinuities between organisational areas.     

WHAT ACCOUNTS FOR THE DECLINE IN CRIME?*

In this article we analyze recent trends in aggregate property crime rates in the United States. We propose a dynamic equilibrium model that guides our quantitative investigation of the major determinants of observed patterns of crime. Our main findings can be summarized as follows: First, the model is capable of reproducing the drop in crime between 1980 and 1996. Second, the most important factors that account for the observed decline in property crime are the higher apprehension probability, the stronger economy, and the aging of the population. Third, the effect of unemployment on crime is negligible. Fourth, the increased inequality prevented an even larger decline in crime. Overall, our analysis can account for the behavior of the time series of property crime rates over the past quarter century.     

A note on forecasting international tourism demand in Spain

This paper considers the extent to which price and income proxy variables help in forecasting tourist demand in Spain. Contrary to some recent studies, we found that the inputs' contribution in terms of fitting and forecasting is nil when compared with alternative univariate models. Whether these findings are the results of the restrictions embedded in building the proxy inputs or in a poor specification of the dynamics of these models remains to be seen. We also contend that when dealing with medium, long-term forecasting comparisons, the use of the traditional aggregate accuracy measures like RMSE and MAPE help very little in discriminating among competing models. In these situations, predicted annual growth rates may be a better alternative.