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This paper focuses on the proliferation of empirical measures of competitive balance arising from its multi-dimensionality (i.e. win dispersion versus performance persistence), and the increasing complexity and specificity of league structures. This has led to significant inconsistencies in the assessments of competitive balance, rendering it difficult to derive policy recommendations.

The authors extend previous empirical studies of the four North American major leagues (i.e. MLB, NFL, NBA and NHL) using six competitive balance measures to (1) compare changes in competitive balance over the period 1960–2019; (2) to investigate the degree to which win dispersion and performance persistence move in the same direction; and (3) to explore the extent to which competitive balance has changed across facility construction eras and regulatory regimes.

The authors find that the assessment of competitive balance is both metric-dependent and time-dependent, reinforcing the importance of using a portfolio of measures rather than a single metric. The findings also highlight the importance of understanding the dispersion-persistence relationship.

The authors stress that leagues must be aware of a potential dispersion-persistence trade-off when intervening to improve competitive balance.

The purpose of this paper is to address the problem of designing league regulatory mechanisms given the multi-dimensionality of competitive balance and the proliferation of empirical measures.

A three-stage approach is adopted. Firstly, a taxonomy of empirical measures of competitive balance is proposed, identifying two fundamental dimensions – win dispersion and performance persistence. Secondly, a simple two-team model of league competitive balance is used to explore the dispersion–persistence relationship. Third, correlation and regression analysis of seven empirical measures of competitive balance for the 18 best-attended top-tier domestic football leagues in Europe over the 10 seasons, 2008–2017, are used to (1) validate the proposed categorisation of empirical measures into two dimensions; and (2) investigate the nature of the dispersion–persistence relationship across leagues.

The simple model of league competitive balance implies a strong positive dispersion–persistence relationship when persistence effects increase for big-market teams relative to those for the small-market teams. However, the empirical evidence indicates that while leagues such as the Spanish La Liga exhibit a strong positive dispersion–persistence relationship, other leagues show little or no relationship, and some leagues, particularly, the English Premier League and top-tier divisions in Belgium and Netherlands, have a strong negative dispersion–persistence relationship. The key policy implication for leagues is the importance of understanding the direction and impact of dispersion and persistence effects on the demand for league products.

The variability in the strength and direction of the dispersion–persistence relationship across leagues is an important result that undermines the “one-size-fits-all” approach to designing league regulatory mechanisms.

The purpose of this paper is two‐fold: first, to examine whether the quality of accruals, as measured by accrual persistence, improved in the post‐Sarbanes‐Oxley (SOX) period, and second, to examine the degree to which SOX‐related improvement in accrual persistence varies across companies depending on the degree of their auditor's independence.

The paper compares accrual persistence in the pre‐ and post‐SOX periods to test the first question. Then, partitioning on relative client importance as a measure of auditor independence, the paper compares the SOX‐based improvement for clients of low and high independence audit firms.

The study first demonstrates that accrual persistence increased significantly in the post‐SOX period. The study also finds evidence that in the post‐SOX period, the subsample of companies audited by Big‐N auditors with lower‐independence experienced the greatest improvement in accrual persistence.

This is the first paper to evaluate SOX‐related improvements in the quality of earnings as measured by accrual persistence. Prior studies test abnormal accruals and other earnings management metrics, however, persistence is a more general test of financial statement quality. This study also is the first to compare SOX‐related improvements for clients of firms with differing levels of independence.

Summarizes previous research on the links between multinationality and earnings persistence and presents a study which applies the autoregressive, integrated, moving‐average time series model to 1990‐1999 data on the largest US multinationals. Explains the methodology and presents the results, which show a negative relationship between the level of multinationality and earnings persistence measures. Puts this down to a negative link between multinationality and performance; and reduced risk through international diversification and profit stabilization.

The purpose of this paper is to evaluate threshold effects in the persistence of South African aggregate inflation data.

The conventional approach for assessing the degree of persistence within an inflation process is via its integration properties. This study makes use of univariate threshold autoregressive (TAR) models and associated unit root testing procedures to investigate the integration properties of the inflation data. Out‐of‐sample forecasts are further performed for the TAR models and their linear counterparts.

The empirical results confirm threshold effects in the persistence of all employed aggregated measures of inflation, whereas such asymmetric effects are ambiguous for disaggregated inflation measures. None of the observed series is found to be stationary in their levels. The out‐of‐sample forecasts for all TAR models outperform their linear counterparts.

Given the scope of the study, the empirical analysis provides insight with concern to the performance of inflation subsequent to the adoption of the inflation target regime in South Africa. Of particular interest are the low persistence levels observed at inflation rates of below 4.7 and 4.4 percent for core and CPI inflation, respectively, as both these aggregated measures of inflation play an essential role in guiding monetary policy conduct within the economy. The overall findings imply that on an aggregate level, the South African Reserve Bank's (SARB's) current inflation target of 3‐6 percent encompasses a non‐stationary inflation range and thus proves to be restrictive on monetary policy conduct.

The paper fills in an important gap in the academic literature by evaluating asymmetric effects in the integration properties of inflation, at both aggregated and disaggregated levels, for the exclusive case of South Africa.

The purpose of this paper is to compare the return performance and persistence of ethical and conventional mutual funds during two extreme events, the Asian and the global financial crises under Shariah constraints.

The overall sample comprises of 129 Islamic mutual funds (IMFs) and 350 conventional mutual funds (CMFs) in Malaysia, and the average monthly data cover two periods of market cycles, before and during a financial crisis. The net of all expenses data is obtained from the Morningstar Database. This study employs various market risk-adjusted performance measures (ratios) to estimate the funds’ overall performance during the crises, and then it uses CAPM model to estimate the parameters via panel data approach. Moreover, paper employs the two persistence performance measures on IMFs and CMFs through contingency tables. It tests for the performance persistence effects for IMFs, CMFs using repeat winner and the cross-product ratio (CPR) tests proposed by Malkiel (1995) and Brown and Goetzmann (1995), respectively.

The main findings of the paper are: on average, both funds IMF and the CMF outperform the market return during the entire sample period; none of the funds is better than the “others” during the financial crises and the pre-crisis periods; the ethical fund – IMF outperforms the CMF over the study period. This outcome also indicates that ethical funds are more persistent especially during and the pre-crisis AFC and the GFC periods.

The finding of this study is limited to only Malaysian data because the objective was to guideline investors and market players in Malaysia to prefer investing in Islamic ethical funds to diversify their investment portfolio.

Cautions to use existing ratio measures and CAPM model rather persistence measures may be used with existing methodologies in light of extreme events which influenced investor decision making for better returns at lower risks.

A class of ethical funds consists of religious sustainable, socially responsible and impact-investing (SRI) funds but Shariah implications of halal investment must be observed to avoid prohibited practices within the class of SRI funds.

The work done in this paper are original in the sense that the authors employed various ratios to measure fund performance in conjunction with CAPM model and then tested for two persistence performance measures; the repeat winner and CPR tests.

The purpose of this paper is to test the existence of true persistence in the generation and adoption of product innovations in the context of a developing country.

A dynamic probit model with random effects is used to test true persistence relying on a panel data set constructed from three waves of the Colombian innovation survey (Encuesta de Desarrollo e Innvovación Tecnológica) covering the time span from 2003 to 2008.

This paper empirically shows the existence of true innovation persistence for two of the three types of product innovation studied: the adoption of product innovation that is new to the firm; and the adoption of product innovation that is new to the national market. However, the study could not confirm true persistence in the generation of product innovation.

To the best of our knowledge, this is the first study that systematically tests innovation persistence differentiating between the adoption of innovations that are new to the firm and innovation that is new to the national market. It is also the first study in this research area that uses a dynamic probit model with random effects according to the original specification by Wooldridge (2005).

En este trabajo se prueba la existencia de verdadera persistencia en la generación y adopción de innovaciones de productos en el contexto de un país en desarrollo.

Para probar la existencia de verdadera persistencia se estima un modelo probit dinámico con efectos aleatorios utilizando tres cohortes de la Encuesta de Desarrollo e Innvovación Tecnológica (EDIT) que cubren el periodo de tiempo 2003-2008.

Este trabajo muestra empíricamente la existencia de verdadera persistencia en dos de los tres tipos de innovación de productos estudiados: en i) la adopción de innovación de productos nuevo para la empresa, y ii) la adopción de innovación de productos nuevo para el mercado nacional. Sin embargo, el estudio no pudo confirmar la verdadera persistencia en la generación de innovación de productos.

Este es el primer estudio que evalúa sistemáticamente la persistencia en la innovación diferenciando entre la adopción de innovaciones que son nuevas para la empresa de las que lo son para el mercado nacional. También es el primer estudio en esta área de investigación que utiliza un modelo probit dinámico con efectos aleatorios de acuerdo con la especificación original de Wooldridge (2005).

The authors investigate whether abnormal tone in corporate narrative disclosures is associated with earnings management and earnings quality, in an emerging market context. Based on agency theory and opportunistic/impression management perspective, this study examines whether executives manage disclosure tone to support their opportunistic behavior, when using earnings management.

This study uses a sample of earnings press releases of publicly traded firms in the MENA region during 2014–2019. It employs textual analysis to measure disclosure tone. The authors estimate abnormal disclosure tone after controlling for firm characteristics. Discretionary accruals proxy for earnings management and are estimated using Modified Jones model. Earnings quality is measured using accounting-based and market-based proxies: earnings smoothness, persistence, predictability and value relevance/informativeness.

Results show a positive association between abnormal disclosure tone and earnings management. Additionally, results show that earnings persistence is higher for firms with lower levels of abnormal disclosure tone. Results are sustained for earnings smoothness, but not for predictability and value relevance/informativeness.

Results provide initial evidence of management's use of tone management jointly with earnings management. This adds to prior studies adopting the opportunistic perspective of disclosure tone, through showing that discretionary tone in narrative disclosures can be strategically used by management to influence investors' perceptions.

The results provide valuable insight to board of directors, auditors and market participants on the possible biases emerging from tone of narrative disclosures in corporate reports. For regulators and standard-setters, results shed light on the need for regulations and rules beyond financial statements, to guide disclosure of narrative information in different corporate reports.

This study contributes to the rare evidence that investigates textual disclosure characteristics to uncover management's opportunistic practices and assess earnings quality. Where majority of studies concentrate on developed markets, this study provides novel evidence of emerging markets by examining the association between abnormal disclosure tone and earnings management/earnings quality. Also, it validates the tone management model proposed by Huang et al. (2014) for capturing tone manipulation.

Managers, investors and security analysts all pay special attention to the bottom line of income statements and they miss significant information included in accruals about the quality of earnings. A considerable portion of the earnings-quality literature examines the possibility of using the accruals to shift reported income among fiscal periods. One of the main roles of working-capital accruals is to adjust the recognition of cash flows. This paper aims to focus on earnings quality by examining the working-capital accruals quality using the method of Dechow and Dichev (2002).

Following the Dechow and Dichev (2002) model, the result of this paper shows that accrual quality is related to the absolute magnitude of accruals negatively. Also, the standard deviation of accruals, cash flows, sales and earnings is positively related to firm size. The result demonstrates and suggests that these observable firm characteristics can be used as instruments for measuring accrual quality. According to this framework, the author expects that the larger the unsigned abnormal accrual measure, the lower the earnings quality. Therefore, firms with low accrual quality have more accruals that are unrelated to cash flow realisations and so have more noise and less persistence in their earnings.

After examining earnings and accrual quality, this paper finds that average UK company behaviour was quite similar to the behaviour found earlier in the USA. This paper’s findings show that greater volatility of sales, cash flow, accruals and earnings results in a lower accrual quality. Without a doubt, some of the analysis in this paper, especially that using different equations to calculate working-capital accruals, leads us to a valuable improvement of the earlier studies.

In this paper, the author follows the method of Dechow and Dichev (2002) and define accrual quality as the extent to which accruals map into cash-flow insights based on the UK data. To find the quality of working-capital accruals, the author uses the standard deviation of the residuals as accrual quality that resulted from the author’s firm-specific OLS regressions of working-capital accruals based on last, current and one-year-ahead operating cash flow. Unlike prior research, to avoid a restriction to working-capital accruals, we use different equations to cover more items of working-capital accruals.

The purpose of this paper is to report on a sequential three-stage analysis of inflation persistence using monthly data from 11 inflation targeting (IT) countries and, for comparison, the USA, a non-IT country with a history of credible monetary policy.

First, the authors estimate inflation persistence in a rolling-window fractional-integration setting using the semiparametric estimator suggested by Phillips (2007). Second, the authors use tests for unknown structural breaks as a means to identify effects of the regime switch and the global financial crisis on inflation persistence. The authors use the sequences of estimated persistence measures from the first stage as dependent variables in the Bai and Perron (2003) structural break tests. Finally, the authors reapply the Phillips (2007) estimator to the subsamples defined by the breaks.

Four countries (Canada, Iceland, Mexico, and South Korea) experience a structural break in inflation persistence that coincide with the implementation of the IT regime, and three IT countries (Sweden, Switzerland, and the UK), as well as the USA experience a structural break in inflation persistence that coincides with the global financial crisis.

The authors find that in most cases the estimates of inflation persistence switch from mean-reversion nonstationarity to mean-reversion stationarity.

Monetary policy implications differ between pre- and post-global financial crisis.

Global financial crisis affected the persistence of inflation rates.

First paper to consider the effect of the global financial crisis on inflation persistence.