The influence of executive age,career horizon and incentives on pre-turnover earnings management

In this paper we hypothesize that CEOs will be motivated to manage earnings prior to a turnover decision. This motivation comes from the horizon problem for CEOs nearing retirement age and for CEOs whose profit-based bonus is a large portion of their total compensation. We find that firms in which CEOs are nearing retirement age have large discretionary accruals in the year prior to turnover. Although we find firms with a larger proportion of profit-based bonus pay have larger discretionary accruals, this result is not robust with the inclusion of control variables in the regressions.

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Democracy and Private Property: Governance of a Three-Party Public–Private Partnership

This paper contributes to the study of efficient governance of public–private partnerships (PPPs) through an inductive comparative case study of three riding schools in Sweden. Each school is a three-party PPP between a private firm, a democratic nonprofit association, and a municipality. The results indicate that efficient PPPs mixing private, collective, and communal interests can be established through an adaptive governance strategy. The private firm can shield the democratic association from market influence through adapting to market conditions; the municipality can create a governance strategy; and the democratic association can focus on providing riding services and fostering democratic governance.

The role of risk preferences and flexibility for risk management: lessons from a custom manufacturing environment

In this paper, we study the management of financial risks of a custom manufacturer in the specialty chemicals industry arising from increased volatility of profits caused by market uncertainty and growing competitive pressure due to globalization. We argue that such risk management can be established either by creating and utilizing flexibility or by adjusting the risk preferences. Using a model-based approach, we operationalize flexibility and risk preferences to show their effects on the profit/risk and the decision making of a firm through a stylized example motivated by the specialty chemicals business.

The Emerging Perspective of Governance and Poverty Alleviation: A Case of Bangladesh

The majority of the rural people in the developing world are subject to severe poverty, inequality and unemployment. Over the years, a number of institutional approaches have been experimented to eradicate poverty from society. Despite the historical role accorded to the state, the states in many developing countries have not been quite effective in poverty alleviation. Following the global trends many developing country states have created space for the market forces and civil society organizations to contribute to poverty alleviation. This is what is popularly known as the new perspective of governance. This article intends to analyze the new perspective of governance and its role in poverty alleviation with empirical evidence from Bangladesh.

Managing Integrity: The Regulation of Post Public Employment in Britain and Hong Kong

In this article, we examine the regulatory mechanisms governing post public employment in Britain and Hong Kong in the context of changing views on how integrity should be managed in their civil services. In both places, new public management practices have increased the possibility of ‘soft’ conflicts of interest which in turn has resulted in debates over the necessary degree of regulation, the organizational form that this should take, and the extent to which ethical concerns should be more focused on the communication and inculcation of core values in civil servants. We argue that the difficulty of regulating ‘soft’ conflicts of interests is driving moves toward the greater centralisation of ethical regulation in both Britain and Hong Kong and that there appears to be a return to more traditional ways of managing integrity.

Falling Between Two Cracks: The Indeterminate Character of Mid-level Government

This article argues that the neglect of mid-level government among public administration scholars is regrettable because the investigation of developments within this level of governmental could shed new light on various core themes in public administration. In order to understand developments taking place at the local level, it is often necessary to investigate what is going on at the mid-level. This article concludes that public administration scholars should develop a general framework to judge the policies and position of mid level government, investigate whether the provincial level is the appropriate level for developing policies, conduct more independent evaluations of processes taking place at the mid-level layer of government; and conduct comparative research into the causal mechanisms that determine the needs for mid-level government.

The organization of project evaluation under competition

This article examines the optimal organizational form of project evaluation under competition. The evaluations are carried out by two fallible screening units that sequentially assess projects. Screening can be organized as a hierarchy or a polyarchy. We show that as competitive pressure rises, the polyarchy becomes less attractive. Therefore, different organizational forms might be found in different industries depending on the degree of competition. In addition, we examine endogenous screening rules under competition: For symmetric situations, we show that polyarchies will employ higher decision thresholds compared to hierarchies. Nonetheless, as in the case of exogenous screening rules, the hierarchy becomes more attractive the higher the degree of competition.

Substitution, availability and preferences in earnings management: empirical evidence from China

Our study analyzes financial reporting data on earnings management from a rapidly changing economy—the PRC. Some Chinese regulatory reforms allow for an easy identification of incentives to engage in both accounting and real earnings management activities. In addition, straightforward economic reasoning suggests that firms incur different costs for pursuing these strategies, which leads to the possibility of a hierarchy or ranking of different earnings management practices. Our results show that accounting and real earnings management activities were significantly higher for firms in danger of missing a regulation imposed performance threshold. After controlling for the availability of the different instruments, our results provide weak evidence for a ranking of different earnings management activities.

Empowerment as a success factor in start-up companies

In this paper, we develop a theoretical model of employee empowerment in start-ups by integrating different management-oriented approaches in the literature. To test this model, we use recent survey data from start-up companies in high-growth industries based in Germany. In particular, we examine the degree to which employee empowerment as a modern concept of delegative leadership contributes to a higher organizational effectiveness within the firm and eventually to higher growth.

Accountability in the Shadow of Hierarchy: The Horizontal Accountability of Agencies

In the Netherlands, new accountability arrangements are created as remedies for the accountability deficit of agencies. These arrangements are of a ‘horizontal’ nature, as the agencies account for their behaviour towards accountees that are not their hierarchical superiors: clients, stakeholders or peers. This paper provides an inventory and qualitative assessment of horizontal accountability arrangements. It is argued that they have added value because they stimulate learning. However, horizontal accountability is not a substitute for hierarchical accountability. Horizontal accountability arrangements operate ‘in the shadow of hierarchy’: they gain significance through complex interactions with traditional forms of accountability.

Can institutional investors fix the corporate governance problem? Some Danish evidence

It has been advocated within corporate governance that institutional investors may discipline management in listed firms and thereby alleviate the free rider problem associated with dispersed ownership. This article tests this hypothesis using a sample of Danish listed firms during 1998–2001 determining, whether ownership by institutional investors impacts performance, measured by Tobin’s q. Using three stage least squares, it is shown that aggregate ownership by institutional investors does not influence firm performance. However, when decomposing the results, it is found that joint ownership by the largest two Danish institutional investors, has a significant negative impact firm performance. Ownership by banks and to a lesser extent insurance companies significantly influences firm performance positively. The results somehow challenge the conventional wisdom, arguing that the black box view of institutional investors should be abandon. Therefore it is suggested that a more careful analysis should be devoted to each institutional investors own legal environment.

In—Credible Government: Legitimacy, Democracy, and Non-Governmental Organizations

This article analyses emerging trans-global networks of governance that are coming to light within a post-democratic form of governance that relies upon specific technologies of credibility building, as opposed to universalistic mechanisms of representation. Using the NGO sector as a model, and using examples from fieldwork conducted in the unraveled contexts of Bosnia and Croatia, and the unraveling context of Ecuador over the past decade, we show how intervention within the global south and post conflict realms, although often couched using such master terms as democracy, development and freedom, are in fact geared towards the generation of political legitimacy and influence through relationships based upon the exchange of credibility.

Japan’s Innovation of Public Organizations in the Research and Development Field

The Japanese government implemented drastic restructuring of the central government in 2001. As a part of this reform, the incorporated administrative agency (IAA) system was newly introduced in view of carrying out certain public functions in a more flexible, business-like and autonomous way. Research and development activities in the public sector are now mostly conducted by the incorporated administrative agencies. In this article, the purpose of this reorganization is firstly described followed by the outline of this system and current accomplishments. In concluding, the Japanese undertaking of a new public organization is analyzed in comparison with the European and “Anglo-Saxon” countries.

Making corporate governance count: the fusion of ethics and economic rationality

Corporate governance codes extensively appeal to ethical standards of conduct. Rather than being articulated alongside economic axioms, ethical and moral precepts are intertwined within neo-classical economic argumentation across corporate governance standards. This paper explores the fusion between ethics and modern economic rationality and reflects on the scientisation of economics and ethics in academic discourse. The argument is then made that the enlistment of ethics within the epistemologically privileged posture of economics characterises corporate governance codes. The UK Combined Corporate Governance Code of 2006 is analysed to draw out the paper’s contention.

Diesseits von Coaching und Mentoring: Kollegiale Praxisberatung

Zusammenfassung  Die Methode der kollegialen Beratung eignet sich gut für Menschen in Organisationen, die vor der Herausforderung stehen, ihr Prozesswissen in neuen, unbekannten Kontexten anzuwenden. Schnelligkeit und konkreter Praxisbezug sind dabei wesentliche Faktoren für eine akzeptierte Lernform. In diesem Artikel wird eine Anpassung der Grundmethode der kollegialen Beratung, die kollegiale Praxisberatung, vorgestellt, die diese Anforderung der Praktiker erfüllt. Die dabei auftretenden Prozesswirkungen und Lernerfahrungen werden anhand zweier Praxisbeispiele aus der Industrie illustriert und Chancen sowie Grenzen der Methode diskutiert.

Regional Development Agencies in Turkey: Are They Examples of Obligated Policy Transfer?

EU requires the candidate states to introduce the necessary legal arrangements and administrative reforms to harmonize with the EU’s regional policy, and the establishment of RDAs is an important element of those administrative reforms. This is an example of “obligated policy transfer,” which is a subtype of policy transfer. In this context, this article aims to analyze the establishment of RDAs in Turkey as an example of obligated policy transfer. Within this perspective, this article primarily explicates the conceptual framework of policy transfer and obligated transfer as a subtype of policy transfer. Second, the place of RDAs within the EU regional policy and Turkey’s view of regional governments and development conception will be briefly dealt with. Finally, establishment of RDAs in Turkey will be analyzed, using official documents, as an example of obligated policy transfer and the role of EU will be demonstrated.

Measuring Citizen Satisfaction with Aspects of Public Services from a Local Authority and Determining Their Importance: A Case Study

The measurement of service quality is a theme of great importance to service providers, particularly public agencies. Over the years their role has been changing by providing more and more high quality services, away from basic ones. In this paper the service quality of a local government is analyzed through the measurement of customer satisfaction. The analysis, based on a questionnaire survey, identified and classified the most essential factors that make up the customer satisfaction with the services provided by the Demographic Department of Gioia del Colle, a town in southern Italy.

Measuring tax distortions with neutrality-based effective tax rates

In public economics, effective tax rates (ETRs) are often used to measure the combined effects of tax rates, tax bases, and the time effect of taxation. Until now, the modelling of comparable figures for revealing tax effects and tax-induced distortions is not solved satisfactorily. This paper derives an ETR approach based on neutral tax systems. In contrast to traditional measures of ETRs, the neutrality-based ETR discloses preferential or discriminatory taxation of investments regardless of their pre-tax rate of return. Moreover, comparing different ETRs exposes the degree of tax-induced investment distortions.

Strangers in a Strange Land: Shock,Disappointment, and Adjustments Experiences of Expatriates in Central Asia

Increasing globalization is driving an increase in diversity and interaction. A more mobile and international workforce frequently requires that individuals try to understand the norms of their “new” society. This paper provides a preliminary exploration of the types of issues and concerns raised by expatriates working in a new foreign environment. In particular, the paper uses a hybrid survey/interview methodology to identify specific issues raised by expatriates working in Kazakhstan, Central Asia.

Student Selection and Incentives

The paper discusses the impact of performance based selection in secondary education on student incentives. The theoretical approach combines human capital theory with signaling theory. The consideration of signaling offers an explanation for observed performance of educational systems with a standard peer effect argument. More specifically it can be optimal to select students according to ability even if selective systems do not outperform comprehensive systems in tests. Selection achieves the same output with lower private costs for the students. The paper questions the strong focus on educational tests to measure the efficiency of selective systems as long as these tests provide no information about a student’s incentives and private costs.