External audit and goodwill write-off

Building on agency theory, we investigate whether and how salient external auditor characteristics (size, audit fees, non-audit fees, tenure) impact on the reported goodwill write-off. We use a sample of US firms applying SFAS 142. We find that Big-4 auditors are more prone to limit underestimated write-offs rather than overestimated write-offs and that auditors require higher fees from companies underestimating the write-offs. The findings are consistent with the auditors’ preference for more conservative goodwill and earnings values, which reduce their litigation and reputation costs. This preference can converge with the managerial interest to use unnecessary overestimated goodwill write-offs for earnings management purposes (e.g. to smooth the income or take big baths). Our findings do not support the hypotheses that non-audit fees and tenure affect the goodwill write-off. Our paper contributes to prior literature on external audit and financial accounting choices. Our study suggests that leniently audited discretional fair value estimates are likely to compromise the role of auditing (and of financial reporting) as an external control mechanism. Our study can contribute to the current policy debate around goodwill accounting.     

Optimal Logistics Networks: the Case of Italian Exports to Russia

This paper is based on the concept of ‘logistics excellence’. In the first part the parameters that define such excellence in the internationalization process of companies are discussed, with particular attention to its effects on the design of logistics networks. A critical analysis of some Italian case studies of “logistics excellence” is presented, to show how some Italian companies, involved in foreign trade, have changed their network design in order to reach excellent performances. One of the most interesting results of this analysis is that in some cases goals behind decisions were too high (“overperformance”) and generated network designs that were too expensive and complex if set against a balanced needs analysis (of clients and logistics operators). Only those who have borne in mind their clients’ needs as well as the need of limiting network costs and have supported their systems with creative choices have managed to achieve the best results within the Italian logistics system. In the light of these considerations, the second part of the article analyses the logistics situation in commercial relations between Italy and Russia (with specific reference on export from Italy to Russia) and points out how, in the face of some structural problems posed by the logistics distribution in Russia, the network design solutions that can reduce costs the most are those which will turn out being the most suitable in the long run. In the light of this, the steps to be taken in order to support the design of adequate logistics networks connecting Italy and Russia are described; the options offered by intermodal transport when adequately combined with newly designed logistics networks are also highlighted.     

Michael Thompson's contributions to making social science more social and scientific

Good social and political theory is parsimonious, cumulative, counter‐intuitive, and relevant to well‐intended efforts to solve gripping social problems. This introduction to the Festschrift shows that in developing ‘rubbish theory’ and ‘cultural theory’ the work of Michael Thompson meets all these criteria. Added is a ‘top 10’ of quotes from Thompson's work, an overview of his academic career, as well as a bibliography.     

WHY DO MOST ITALIAN YOUTHS LIVE WITH THEIR PARENTS? INTERGENERATIONAL TRANSFERS AND HOUSEHOLD STRUCTURE

More than 80% of Italian men aged 18–30 live with their parents. We argue that one contributing factor to this remarkably high rate of cohabitation is parents' tastes for coresidence. In order to investigate the role of parental preferences, we estimate the effect of exogenous changes in parental income on rates of cohabitation in Italy using Survey of Households' Income and Wealth (SHIW) micro data from 1989 to 2000. In order to identify a source of exogenous variation in parental income, we use changes in fathers' retirement age induced by the 1992 reform of the Italian Social Security system as an instrumental variable for parental income. By raising retirement age, this reform forced some fathers to remain in the labor market longer than they would have otherwise, therefore raising their disposable income. We use a two‐sample instrumental variable (TSIV) strategy. Our TSIV estimates indicate that a rise in parents' income significantly raises the children's propensity to live at home: A 10% increase in annual parental income results in approximately a 10% rise in the proportion of men living with their parents. Although we cannot definitely rule out alternative interpretations, these results are consistent with our hypothesis that cohabitation is a normal good for Italian parents. (JEL: J120, J610, H550)     

A Multicompartment SIS Stochastic Model with Zonal Ventilation for the Spread of Nosocomial Infections: Detection,Outbreak Management,and Infection Control

In this work, we study the environmental and operational factors that influence airborne transmission of nosocomial infections. We link a deterministic zonal ventilation model for the airborne distribution of infectious material in a hospital ward, with a Markovian multicompartment SIS model for the infection of individuals within this ward, in order to conduct a parametric study on ventilation rates and their effect on the epidemic dynamics. Our stochastic model includes arrival and discharge of patients, as well as the detection of the outbreak by screening events or due to symptoms being shown by infective patients. For each ventilation setting, we measure the infectious potential of a nosocomial outbreak in the hospital ward by means of a summary statistic: the number of infections occurred within the hospital ward until end or declaration of the outbreak. We analytically compute the distribution of this summary statistic, and carry out local and global sensitivity analysis in order to identify the particular characteristics of each ventilation regime with the largest impact on the epidemic spread. Our results show that ward ventilation can have a significant impact on the infection spread, especially under slow detection scenarios or in overoccupied wards, and that decreasing the infection risk for the whole hospital ward might increase the risk in specific areas of the health‐care facility. Moreover, the location of the initial infective individual and the protocol in place for outbreak declaration both form an interplay with ventilation of the ward.     

The disinformation landscape and the lockdown of social platforms

ABSTRACT

This introduction to the special issue considers how independent research on mis/disinformation campaigns can be conducted in a corporate environment hostile to academic research. We provide an overview of the disinformation landscape in the wake of the Facebook-Cambridge Analytica data scandal and social platforms’ decision to enforce access lockdowns and the throttling of Application Programming Interfaces (APIs) for data collection. We argue that the governance shift from user communities to social media algorithms, along with social platforms’ intensive emphasis on generating revenue from user data, has eroded the mutual trust of networked publics and opened the way for dis/misinformation campaigns. We discuss the importance of open, public APIs for academic research as well as the unique challenges of collecting social media data to study highly ephemeral mis/disinformation campaigns. The introduction concludes with an assessment of the growing data access gap that not only hinders research of public interest, but that may also preclude researchers from identifying meaningful research questions as activity on social platforms becomes increasingly more inscrutable and unobservable.     

Disentangling an avian assemblages’ evolutionary and functional history in a Chihuahuan desert city

Urban Ecosystems - Urban green spaces have been shown to be important hotspots of biodiversity in cities of temperate and humid/semihumid tropical ecoregions. Nonetheless, whether this pattern...     

Tasks,occupations and wages in OECD countries

This article investigates the links between earnings, human capital and job tasks, using internationally comparable information from the OECD Survey of Adult Skills. The authors use the theoretical framework developed by Autor and Handel (2013) and extend their empirical results to 21 OECD countries. The data allow for a richer characterization of workers' human capital by including both educational attainment and a measure of cognitive skills. Their findings confirm the predictive power of job tasks in explaining wage differences, both between and within occupations, and provide empirical support for the model's prediction in the vast majority of countries.     

NORMS OF PUNISHMENT: EXPERIMENTS WITH STUDENTS AND THE GENERAL POPULATION

Norms of cooperation and punishment differ across societies, but also within a single society. In an experiment with two subject pools sharing the same geographical and cultural origins, we show that opportunities for peer punishment increase cooperation among students but not in the general population. In previous studies, punishment magnified the differences across societies in people's ability to cooperate. Here, punishment reversed the order: with punishment, students cooperate more than the general population while they cooperate less without it. (JEL C72, C90, Z13)     

A POLITICAL ECONOMY THEORY OF FISCAL POLICY AND UNEMPLOYMENT

This paper presents a political economy theory of fiscal policy and unemployment. The underlying economy is one in which unemployment can arise but can be mitigated by tax cuts and increases in public production. Such policies are fiscally costly, but can be financed by issuing government debt. Policy decisions are made by a legislature consisting of representatives from different political districts. With the available policies, it is possible for the government to completely eliminate unemployment in the long run. However, with political decision making, the economy always has unemployment. Unemployment is higher when the private sector experiences negative shocks. When these shocks occur, the government employs debt‐financed fiscal stimulus plans which involve both tax cuts and public production increases. When the private sector is healthy, the government contracts debt until it reaches a floor level. Unemployment levels are weakly increasing in the economy's debt level, strictly so when the private sector experiences negative shocks. Conditional on the level of workers employed, the mix of public and private output is distorted.