External audit and bankruptcy prediction

In this paper, we investigate the relationship between external auditor characteristics and the likelihood of bankruptcy. We use a sample of US public companies to analyse whether auditor attributes are associated with default. We also test whether the inclusion of such attributes in bankruptcy prediction models improves their predictive ability. We find that firms audited by industry-expert auditors, large audit firms and long-tenured auditors are less likely to default. Firms with higher audit fees are more likely to default. Our results also show that the inclusion of auditor attributes significantly increases the predictive ability of bankruptcy prediction models. This paper contributes to the literature about auditing and bankruptcy prediction. Our results suggest that the auditor attributes can provide predictive signals concerning a default risk and that an external audit can play a relevant role in early warnings of financial distress. Our study also suggests that bankruptcy prediction models can become more effective if they are complemented with audit data. Our results are of interest to market participants, auditors, regulating authorities, banks and other financial institutions that are interested in credit risk assessment.     

Antecedents of board involvement and its consequences on organisational effectiveness in non-profit organisations: a study on European corporate foundations

Journal of Management and Governance - The governance of non-profit organisations is complex, as these organisations are not only intended to create value for third parties but also dependent on...     

Science for Policy: A Case Study of Scientific Polarization,Values, and the Framing of Risk and Uncertainty

It is well documented that more research can lead to hardened positions, particularly when dealing with complex, controversial, and value‐laden issues. This study is an attempt to unveil underlying values in a contemporary debate, where both sides use scientific evidence to support their argument. We analyze the problem framing, vocabulary, interpretation of evidence, and policy recommendations, with particular attention to the framing of nature and technology. We find clear differences between the two arguments. One side stress that there is no evidence that the present approach is causing harm to humans or the environment, does not ruminate on uncertainties to that end, references nature's ability to handle the problem, and indicates distrust in technological solutions. In contrast, the other side focuses on uncertainties, particularly the lack of knowledge about potential environmental effects and signals trust in technological development and human intervention as the solution. Our study suggests that the two sides’ diverging interpretations are tied to their perception of nature: vulnerable to human activities versus robust and able to handle human impacts. The two sides also seem to hold diverging views of technology, but there are indications that this might be rooted in their perception of governance and economy rather than about technology per se. We conclude that there is a need to further investigate how scientific arguments are related to worldviews, to see how (if at all) worldview typologies can help us to understand how value‐based judgments are embedded in science advice, and the impact these have on policy preferences.     

The More the Merrier? The Causal Effect of High Fertility on Later-Life Loneliness in Eastern Europe

Levels of later-life loneliness are high in Eastern Europe. We assess whether having more children is protective against later-life loneliness for Eastern-European mothers and fathers. Drawing on Generations and Gender Surveys data of 25,479 parents aged 50–80 from eight Eastern-European countries, we adopt an instrumental approach exploiting parents’ preference for mixed-sex offspring to estimate the causal effect of having additional children on feelings of loneliness. We find that having an additional child has a causal protective effect against loneliness for mothers. Ordinary least squares regression models also show a weak but statistically significant negative association between number of children and later-life loneliness among fathers. However, results of the instrumental variable analyses are inconclusive for this group. We thus do not find statistically significant causal evidence that having an additional child is protective against loneliness for fathers. Our results underline the importance of addressing reverse causality and selection bias when investigating the links between number of children and later-life loneliness, particularly among women. The causal evidence presented here suggests that the trend towards families with fewer children noted in several Eastern-European countries may place new cohorts of older Eastern-Europeans, and in particular Eastern-European women, at risk of stronger feelings of loneliness.

     

Eighteen‐Month‐Old Infants Correct Non‐Conforming Actions by Others

At around their third birthday, children begin to enforce social norms on others impersonally, often using generic normative language, but little is known about the developmental building blocks of this abstract norm understanding. Here, we investigate whether even toddlers show signs of enforcing on others interpersonally how “we” do things. In an initial dyad, 18‐month‐old infants learnt a simple game‐like action from an adult. In two experiments, the adult either engaged infants in a normative interactive activity (stressing that this is the way “we” do it) or, as a non‐normative control, marked the same action as idiosyncratic, based on individual preference. In a test dyad, infants had the opportunity to spontaneously intervene when a puppet partner performed an alternative action. Infants intervened, corrected, and directed the puppet more in the normative than in the non‐normative conditions. These findings suggest that, during the second year of life, infants develop second‐personal normative expectations about their partner's behavior (“You should do X!”) in social interactions, thus making an important step toward understanding the normative structure of human cultural activities. These simple normative expectations will later be scaled up to group‐minded and abstract social norms.     

Effects of garden management practices,by different types of gardeners,on human wellbeing and ecological and soil sustainability in Swiss cities

Urban Ecosystems - Gardens have effects on the local ecology as well as on the wellbeing of the gardener, but few studies have attempted to study gardens using both ecological and social outcome...     

Some Considerations on Well-Being Evaluation Procedures,Taking the Cue from “Exploring Multidimensional Well-Being in Switzerland: Comparing Three Synthesizing Approaches”

In this short paper, we outline some considerations on three different procedures for the statistical evaluation of multidimensional well-being, taking the cue from a recent paper of Iglesias et al. There, the authors apply and compare Confirmatory Factor Analysis, the Alkire–Foster counting approach and the Partial Order Approach on real data, pointing out limitations and potentialities of each procedure. To deepen, and partially correct, some of their (albeit interesting) remarks, here we review the fundamental features of those approaches, so as to shed light on their structural differences and to show that they move from, and may lead to, alternative views on well-being.     

Guess who’s coming to dinner: the case of IC reporting in Italy

Journal of Management and Governance - In the last 2 decades, intellectual capital (IC) reporting has been promoted with the idea that it can lead to internal (managerial) and external...