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John R. Bartle, Kenneth A. Kriz and Boris Morozov
This paper examines trends in local government revenues and current challenges that local governments face in raising revenue. We alsolook into the future in an effort to…
This paper examines trends in local government revenues and current challenges that local governments face in raising revenue. We alsolook into the future in an effort to make recommendations to localgovernments regarding their revenue structure. Important trends that wedocument include a long-term decline in the property tax and an increase inboth state aid and user charges. Recent economic changes present seriouschallenges for local governments due to volatility of sales taxes, decreasesin property values, and threats to state aid. As local governments shape theirrevenue structure, they will need to respond to external economic,technological and demographic changes. Only user charges offer hopefulprospects as a productive revenue source.
Gang Chen, Kenneth Kriz and Carol Ebdon
Public pension plans in the U.S. are seriously underfunded, especially following the financial market crisis of 2008-2009 which resulted in large investment losses…
Public pension plans in the U.S. are seriously underfunded, especially following the financial market crisis of 2008-2009 which resulted in large investment losses. However, funding levels vary widely across plans. Pension boards of trustees make key management decisions in pension systems and these decisions have significant effects on funded levels, yet our empirical knowledge of board management is limited. This study explores the effect of board composition on pension funding levels. Existing theoretical debates lead to differing expectations, and previous studies have mixed results. Our research uses a panel data set of large public pension plans from 2001-2009. We also collect data for pension board composition from this time period. We find that increasing political appointees and employee members on the board increases the funding performance of the pension system.
Josephine M. LaPlante and Beth Walter Honadle
In this introductory essay, the authors describe a new public finance characterized by enduring revenue constraints; mounting budgetary claims from accruing liabilities…
In this introductory essay, the authors describe a new public finance characterized by enduring revenue constraints; mounting budgetary claims from accruing liabilities for post-retirement benefits for government employees, rising health care costs, and an aging population; and uncertainty about future budgetary demands and resource limitations. The new public finance is described as a convergence of economic and demographic forces with past practices that increased the fiscal vulnerability of states and local governments. The authors explain that states and local governments will not overcome challenges by relying upon traditional ways of thinking about and conducting business but instead must revamp frameworks for practice. Symposium papers are described as tackling several of the most pressing issues facing governments today with an eye towards rethinking customary approaches.
Narasimha Rao Vajjhala and Kenneth David Strang
The researchers in this study reviewed the literature to locate the most relevant multicultural theories, factors, and instruments in order to measure Albania's national…
The researchers in this study reviewed the literature to locate the most relevant multicultural theories, factors, and instruments in order to measure Albania's national culture. The paper aims to discuss these issues.
An innovative combination of exploratory and confirmatory factor analysis was used to fit the multicultural construct to the sample data and then estimate the national culture (n=73). The multicultural indexes were calculated for five generally accepted national culture factors to compare with the benchmarks published in the literature.
The multicultural indexes were calculated for five generally accepted national culture factors to compare with the benchmarks published in the literature. An asymmetric plot was created for critical comparison of Albania with five other theoretically selected countries, using the indexes for PDi, ICi, MFi, UAi, and LTi. Albania was found to be most similar to its Balkan and Turkish neighbors, as compared with Asian or Western cultures such as that of the USA.
The researchers discussed the implications of knowing Albania's national culture profile with reference to how other countries might collaborate and transact with this emerging transition economy.
From a business standpoint, the multicultural indexes for Albania provide general indicators of the national beliefs, norms and values, which foreign organizations may compare to their own cultural profile when interacting with professionals in this country. The best use for such indexes is for benchmarking and comparison. Foreign government, private corporations, or nonprofit organizations may compare their own culture profile with that of Albania to be aware of the similarities and differences.
Albanian national culture was estimated for the first time in the literature, using a five-factor model adapted from the work of Hofstede.
John F. Sacco and Gerard R. Busheé
This paper analyzes the impact of economic downturns on the revenue and expense sides of city financing for the period 2003 to 2009 using a convenience sample of the…
This paper analyzes the impact of economic downturns on the revenue and expense sides of city financing for the period 2003 to 2009 using a convenience sample of the audited end of year financial reports for thirty midsized US cities. The analysis focuses on whether and how quickly and how extensively revenue and spending directions from past years are altered by recessions. A seven year series of Comprehensive Annual Financial Report (CAFR) data serves to explore whether citiesʼ revenues and spending, especially the traditional property tax and core functions such as public safety and infrastructure withstood the brief 2001 and the persistent 2007 recessions? The findings point to consumption (spending) over stability (revenue minus expense) for the recession of 2007, particularly in 2008 and 2009.
Ferdinand Balfoort, Rachel Francis Baskerville and Rolf Uwe Fülbier
The evolution of International Financial Reporting Standards (IFRS) was nurtured by economists and accountants loyal to the philosophical basis of what is often referred…
The evolution of International Financial Reporting Standards (IFRS) was nurtured by economists and accountants loyal to the philosophical basis of what is often referred to as “Western” market economies, being classical and neoclassical contracting theories. The purpose of this paper is to illustrate how a particular Asian cultural attribute (guānxì ) impacts on the efficacy of fair value measurement.
Using a literature review and research of studies of the adoption of IFRS in China, studies of both guānxì and fair value in Chinese accounting research, this study unbundles Williamson’s governance structure and contracting theory to examine how guānxì is positioned orthogonally to fair value (market-oriented valuation) principles for financial reporting. This is followed by a case study of the events surrounding the collapse of China Medical Technologies.
Guānxì is integral to Asian economies and economic transactions. Resulting conditions, characterised by relational contracting, may not meet the qualitative characteristics of neutrality and faithful representation in fair value measurement of assets and liabilities. The same may be true when insider or “trusted party transaction” values prevail for large ticket transactions among entities in any jurisdiction.
Future research on the impact of guānxì may be constrained by its often hidden, and yet dynamic, character; and the varieties of its manifestations.
This study highlights how difficult it may be to achieve both comparability and relevance in the asset and liability recognition and measurement rules in Asian (and possibly also other) economies adopting accounting principles that are developed in a Western context.
Paavo Ritala, Kenneth Husted, Heidi Olander and Snejina Michailova
Inter-firm collaborative innovation typically requires knowledge sharing among individuals employed by collaborating firms. However, it is also associated with…
Inter-firm collaborative innovation typically requires knowledge sharing among individuals employed by collaborating firms. However, it is also associated with considerable risks, especially if the knowledge sharing process is not handled using proper judgment. Such risks have been acknowledged in the literature, but the underlying empirical evidence remains unclear. This study aims to examine how sharing of business-critical knowledge with external collaboration partners affects firm’s innovation performance.
The authors develop a mediating model and hypotheses predicting that the uncontrolled sharing of knowledge leads to accidental knowledge leakage, which, in turn, hinders particularly firm’s radical innovation performance. The authors test the model by using a survey of 150 technology-intensive firms in Finland and a partial least squares structural equation model. The mediating model is tested with incremental and radical innovation performance, and the authors control for firm size, age, R&D intensity and industry.
The authors find strong support for the model in that uncontrolled external knowledge sharing leads to accidental knowledge leaking and to lower radical innovation performance. The same results are not found for incremental innovation, implying that uncontrolled knowledge leakage is especially detrimental to radical innovation.
These findings help in better understanding some of the downsides of too much openness and lack of judgment about knowledge sharing beyond the boundaries of the firm. Thus, firms pursuing radical innovation should carefully guide their employees with regard to what knowledge they share, to what extent they share it and with whom they share it.