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The purpose of this paper is to examine the role of monetary liquidity in house price evolution through examining the Asset (housing) Inflation channel. It identifies the…
The purpose of this paper is to examine the role of monetary liquidity in house price evolution through examining the Asset (housing) Inflation channel. It identifies the main channels of transmission affecting house prices from monetary supply channels to house price change, examining how the Asset Price channel transmits changes in M1 to housing prices in Spain and the UK.
The paper uses Vector Auto Regression (VAR) and Error Correction models to test the Asset Inflation channel in the UK and Spain from 1991 to 2013 in two steps. In the first step, the supply elasticity is estimated through the long-term relationship between house prices and stock supply. The second step estimates a Vector Error Correction (VEC) to explain house price dynamics conditioned on supply reactions. The latter is defined as a long-term inverse demand model where housing prices are controlled by fundamentals in each market. Models allow forecast testing using Choleski impulse responses methodology.
Several results are found. In the supply model, both countries show rapid convergence to equilibrium with a larger elasticity of supply in Spain than in the UK but with a short run effect of new supply on prices in the UK. Regarding the Asset Inflation Channel model, the paper finds evidence of the existence of a housing accelerator effect in Spain, but not in the UK where changes in liquidity fully impact house prices in one direction.
Implications of findings are mainly to forecast the effects of Monetary Policy measures in different economies.
The model supports the evaluation of different impacts of monetary policy in territories. It shows that the same policy will have different impacts in different housing markets and therefore highlights the importance of examining each market separately to identify the appropriate policy interventions.
This is the first paper that estimates the impact of the Asset Inflation Channel on house prices that endogenises housing market conditions and compares effects and interrelationships in two different economies.
We examine the effect of peer honesty on focal manager honesty in a budget reporting setting. We disclose peer honesty to the focal manager at three levels: no, partial…
We examine the effect of peer honesty on focal manager honesty in a budget reporting setting. We disclose peer honesty to the focal manager at three levels: no, partial, and full disclosure of the reporting behavior of the other managers in the focal managers’ cohort. In partial disclosure, only the reports of the least honest peers are disclosed to the focal manager. In full disclosure, all managers’ reports in the cohort are disclosed to the focal manager. We predict and find that disclosure of other managers’ reports leads to less honesty compared to the absence of disclosure. We show that disclosure changes the focal manager’s perceptions of what constitutes acceptable reporting behavior, such that reporting more dishonestly becomes more acceptable. Our results have implications for understanding fraud dynamics and have practical implications for the design of control systems, as they suggest that managers will use peer dishonesty to justify their own dishonesty, even when they know that only some of their peers report dishonestly.
To better detect potential audit issues, since 2010, the Internal Revenue Service has required firms to file a separate schedule individually disclosing each of their…
To better detect potential audit issues, since 2010, the Internal Revenue Service has required firms to file a separate schedule individually disclosing each of their uncertain tax positions (UTPs). This study uses an experiment to examine how this increase in detection risk from the newly created IRS schedule influences both a firm’s tax reporting and financial reporting concurrently. We find that corporate tax professionals were more likely to recommend an UTP when their firm had a strong UTP reporting quality, regardless of the detection risk level of the reporting environment. However, we find an interaction effect for the recording of the tax reserve. In a low detection risk environment, corporate tax professionals recorded a higher (lower) tax reserve when their firm had a weak (strong) UTP reporting quality. However, in a high detection risk environment, corporate tax professionals recorded a lower (higher) tax reserve when their firm had a weak (strong) UTP reporting quality. Overall, the results provide insight into the dual nature of UTP reporting and the determinants that influence each reporting behavior.
The purpose of this paper is to analyse the impact of a leader’s communication style (LCS) on the quality of interpersonal exchanges between leaders and followers (LMX)…
The purpose of this paper is to analyse the impact of a leader’s communication style (LCS) on the quality of interpersonal exchanges between leaders and followers (LMX), and how this translates into the employee’s affective organizational commitment (AOC), in the context of Peru.
An integrated model of six dimensions is used to measure LCS. Using multiple hierarchical regressions and the Preacher and Hayes mediation model, the study focuses on determining the direct and indirect effect of each of the dimensions on LMX and organizational commitment.
The dimension preciseness shows a significant direct association to AOC. Four dimensions are significantly related with LMX: expressiveness, preciseness and questioningness with a positive sign, while verbal aggressiveness records an important negative one. The same four dimensions show an indirect effect on AOC through LMX. Emotionality and impression manipulativeness do not record significant results.
The research was carried out with a sample of 253 white-collar Peruvian professionals with high-level studies and managerial experience, which are not necessarily representative of the labor population. This research provides comprehensive evidence on how leaders’ communicative behavior may contribute to desirable outcomes such as employee commitment in a Latin American cultural context, although the findings may apply to other cultures.
This study contributes to clarify that each dimension of the LCS impacts differently on subordinate perceptions; leaders should understand this model and be able to make the necessary adjustments to their communication in order to obtain the desired results of leadership. The leader’s ability to communicate with a style characterized by expressiveness, precision, and questioning makes it easy to build high-quality LMX relationships for Peruvian employees. On the contrary, a communication style characterized by high levels of verbal aggressiveness may negatively affect subordinates, limiting the possibility of building high-quality LMX relationships. This, in turn, affects AOC of employees.
This study is a contribution to clarify that each feature of the LCS has a different impact on the perception of the subordinate, for which the leaders should be trained to understand this model and be able to make the necessary adjustments to obtain the desired results of leadership. The leader’s ability to communicate with a style characterized by expressiveness, precision and questioning makes it easy to build high-quality LMX relationships for Peruvian employees. On the contrary, a communication style characterized by high levels of verbal aggressiveness will negatively impact subordinates, limiting the possibility of building high-quality LMX relationships.
The value lies in revisiting the construct “leader’s communication style” to turn it into an instrument for the exercise of leadership. It is a contribution in favor of leaders becoming aware that their own communication style constitutes an instrument of effective leadership and a lever to optimize the commitment of their collaborators toward the organization.
A number of studies have investigated the relationship between energy performance certificates (EPCs) and house prices. A majority of studies have tended to model energy…
A number of studies have investigated the relationship between energy performance certificates (EPCs) and house prices. A majority of studies have tended to model energy performance pricing effects within a traditional hedonic conditional mean estimate model. There has been limited analysis that has accounted for the relationship between EPCs and the effects across the pricing distribution. Moreover, there has been limited research examining the “standard cost improvements EPC score”, or “potential score”. Therefore, this paper aims to quantify and measure the dynamic effects of EPCs on house prices across the price spectrum and account for standardised cost-effective retrofit improvements.
Existing EPC studies produce one coefficient for the entirety of the pricing distribution, culminating in a single marginal implicit price effect. The approach within this study applies a quantile regression approach to empirically estimate how quantiles of house prices respond differently to unitary changes in the proximal effects of EPCs and structural property characteristics across the conditional distribution of house prices. Using a data set of 1,476 achieved transaction prices, the quantile regression models apply both assessed EPC score and bands and further examine the potential EPC rating for improved energy performance based on an average energy cost improvement.
The findings show that EPCs are valued differently across the quantiles and that conditional quantiles are asymmetrical. Only property prices in the upper quantiles of the price distribution show significant capitalisation effects with energy performance, and only properties with higher EPC scores display positive significant effects at the higher end of the price distribution. There are also brown discount effects evident for lower-rated properties within F- and G-rated EPC properties at the higher end of the pricing distribution. Moreover, the potential energy efficiency rating (score) also shows increased effects with sales prices and appears to minimise any brown discount effects. The findings imply that energy performance is a complex feature that is not easily “averaged” for valuation effect purposes.
While numerous studies have investigated the pricing effects of EPCs, they have tended to provide a single estimate to determine the relationship with price. This paper extends the traditional analytical insights beyond the conditional mean estimate by examining the quantiles of the relationship between EPCs and house prices to enhance the understanding of this esoteric and complex issue. In addition, this research applies the assessed energy efficiency potential to establish whether effective cost improvements enhance the relationship with sales price and capitalisation effects.
“A knowledge of different literatures is the best way to free one's self from the tyranny of any of them.” Jose Marti, Cuban writer, poet and statesman.