Pub Date : 2023-11-02DOI: 10.1080/16081625.2022.2081228
Jie He, Luling He
ABSTRACT Using Chinese A-share listed manufacturing firms from 2008 to 2018, we examine the effect of CEOs’ military experience on firms’ cost stickiness. We find that firms with military CEOs have higher cost stickiness than those without military CEOs. The results are more pronounced for firms with high social responsibility (in SOEs and firms with better corporate social responsibility performance and higher labor intensity) and weak corporate governance (in firms with CEO duality, less independent directors, no director shareholding and no Big Four auditor). Our research extends the understanding of military CEOs’ influence on firms and sheds light on how CEOs’ characteristics affect cost stickiness.
ABSTRACT 我们利用 2008 年至 2018 年的中国 A 股制造业上市公司，研究了 CEO 的从军经历对企业成本粘性的影响。我们发现，与没有军方 CEO 的企业相比，有军方 CEO 的企业具有更高的成本粘性。对于社会责任高的企业（国企和企业社会责任表现较好、劳动密集程度较高的企业）和公司治理弱的企业（CEO双重身份、独立董事较少、无董事持股和无四大审计师的企业），结果更为明显。我们的研究拓展了人们对军方首席执行官对企业影响的理解，并揭示了首席执行官的特征如何影响成本粘性。
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Pub Date : 2023-10-26DOI: 10.1080/16081625.2023.2268099
Yang Wan, Wenhao Wang, Shi He, Bing Hu
ABSTRACTWe utilize the spectral decomposition of TVP-VAR connectedness to examine the dynamics of connectedness among six global financial markets. Additionally, we employ dynamic model averaging with retrospective analysis to ascertain the impact of uncertainties on the connectedness network. The findings reveal a shift from a declining trend in both total and directional connectedness to an ascending trend during the Russia-Ukraine conflict. The US dollar has the largest outward and inward spillovers in the short-term, but G7 MSCI and EFM MSCI are the largest outward and inward spillovers in the medium- and long-term, respectively. Among the five uncertainties under study, the financial stress index and VIX consistently hold significant influence throughout the sample period. Meanwhile, geopolitical risk and Twitter-based economic uncertainty demonstrate significance during the conflict period. Nonetheless, the impacts of these uncertainties diverge. The financial stress index and Twitter-based economic uncertainty exhibit positive effects, whereas VIX and geopolitical risk tend to weaken connectedness. Our findings underscore the need for investors to remain cautious of shifts in market connectedness patterns as they manage their assets.KEYWORDS: Russia-Ukraine conflictuncertaintydynamic connectednessspectral decompositiondynamic model averagingJEL CLASSIFICATION: G01G15C32C11 Disclosure statementNo potential conflict of interest was reported by the author(s).Notes1. See report by ELPAIS: https://english.elpais.com/international/2022-03-03/ukrainian-exodus-could-be-europes-biggest-refugee-crisis-since-world-conflict-ii.html.2. We use ‘risk’ and ‘uncertainty’ interchangeably in this paper.3. For example, the J.P. Morgan Global Research: https://www.jpmorgan.com/insights/research/russia-ukraine-crisis-market-impact.4. This was reported, for example, in a report in CNBC https://www.cnbc.com/2022/02/24/forex-markets-russia-ukraine-invasion-euro-dollar.html.5. There is an alternative approach to estimating a TVP-VAR model, which is based on the Kalman Filter (Antonakakis et al. Citation2018). However, the MCMC procedure for the TVP-VAR approach could help us identify the confidence interval of the estimated parameters. Appendix A1 shows the details about the identification procedure of confidence intervals. Additionally, to reduce the autocorrelations of the draws in the MCMC process, we take every tenth draws in the MCMC process as the effective draws.6. The borders a and b define the frequency domains of short-term and ML-term. In this study, the borders of the short-term are [1, 5], and the borders of the ML-term are [6, 126]. The H chosen is 126, which is the number of trading days in a half-year.7. There is a term called ‘pairwise connectedness’ that measures the spillovers from one market to another market. In this paper, we do not discuss this measure because it does not help understand the effects of the potential determinants on the role o
{"title":"How do uncertainties affect the connectedness of global financial markets? Changes during the Russia-Ukraine conflict","authors":"Yang Wan, Wenhao Wang, Shi He, Bing Hu","doi":"10.1080/16081625.2023.2268099","DOIUrl":"https://doi.org/10.1080/16081625.2023.2268099","url":null,"abstract":"ABSTRACTWe utilize the spectral decomposition of TVP-VAR connectedness to examine the dynamics of connectedness among six global financial markets. Additionally, we employ dynamic model averaging with retrospective analysis to ascertain the impact of uncertainties on the connectedness network. The findings reveal a shift from a declining trend in both total and directional connectedness to an ascending trend during the Russia-Ukraine conflict. The US dollar has the largest outward and inward spillovers in the short-term, but G7 MSCI and EFM MSCI are the largest outward and inward spillovers in the medium- and long-term, respectively. Among the five uncertainties under study, the financial stress index and VIX consistently hold significant influence throughout the sample period. Meanwhile, geopolitical risk and Twitter-based economic uncertainty demonstrate significance during the conflict period. Nonetheless, the impacts of these uncertainties diverge. The financial stress index and Twitter-based economic uncertainty exhibit positive effects, whereas VIX and geopolitical risk tend to weaken connectedness. Our findings underscore the need for investors to remain cautious of shifts in market connectedness patterns as they manage their assets.KEYWORDS: Russia-Ukraine conflictuncertaintydynamic connectednessspectral decompositiondynamic model averagingJEL CLASSIFICATION: G01G15C32C11 Disclosure statementNo potential conflict of interest was reported by the author(s).Notes1. See report by ELPAIS: https://english.elpais.com/international/2022-03-03/ukrainian-exodus-could-be-europes-biggest-refugee-crisis-since-world-conflict-ii.html.2. We use ‘risk’ and ‘uncertainty’ interchangeably in this paper.3. For example, the J.P. Morgan Global Research: https://www.jpmorgan.com/insights/research/russia-ukraine-crisis-market-impact.4. This was reported, for example, in a report in CNBC https://www.cnbc.com/2022/02/24/forex-markets-russia-ukraine-invasion-euro-dollar.html.5. There is an alternative approach to estimating a TVP-VAR model, which is based on the Kalman Filter (Antonakakis et al. Citation2018). However, the MCMC procedure for the TVP-VAR approach could help us identify the confidence interval of the estimated parameters. Appendix A1 shows the details about the identification procedure of confidence intervals. Additionally, to reduce the autocorrelations of the draws in the MCMC process, we take every tenth draws in the MCMC process as the effective draws.6. The borders a and b define the frequency domains of short-term and ML-term. In this study, the borders of the short-term are [1, 5], and the borders of the ML-term are [6, 126]. The H chosen is 126, which is the number of trading days in a half-year.7. There is a term called ‘pairwise connectedness’ that measures the spillovers from one market to another market. In this paper, we do not discuss this measure because it does not help understand the effects of the potential determinants on the role o","PeriodicalId":45890,"journal":{"name":"Asia-Pacific Journal of Accounting & Economics","volume":"38 2","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135013368","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-10-11DOI: 10.1080/16081625.2023.2268140
Guang Li, Yulong Liu, Qiqi Zhang
ABSTRACTThis paper studies the impact of venture capital’s tolerance for technological innovation failure on invested companies’ technological innovation performance using Chinese data. The results show that the higher venture capital’s tolerance for technological innovation failure, the better the performance of the company’s technological innovation. The heterogeneity of venture capital is further examined. We find venture capitals that invest jointly, with foreign-funded or governmental backgrounds can positively regulate the effect of tolerance on performance. However, in industries where innovation is of high difficulty, participation of government venture capital inhibits this effect. Our conclusions provide enlightenment for improving companies’ technological innovation performance.KEYWORDS: Venture capitaltechnological innovationtolerance for failureinnovation performanceVC heterogeneity Disclosure statementNo potential conflict of interest was reported by the author(s).Additional informationFundingThis work was supported by the Anhui University of Finance and Economics [ACYC2020409]; Humanity and Social Science Research Project of Anhui Educational Committee [SK2019A0473]; Humanity and Social Science Research Project of Anhui Educational Committee [SK2020A0027].
{"title":"Venture capital shareholding, tolerance for technological innovation failure, and technological innovation performance: evidence from China","authors":"Guang Li, Yulong Liu, Qiqi Zhang","doi":"10.1080/16081625.2023.2268140","DOIUrl":"https://doi.org/10.1080/16081625.2023.2268140","url":null,"abstract":"ABSTRACTThis paper studies the impact of venture capital’s tolerance for technological innovation failure on invested companies’ technological innovation performance using Chinese data. The results show that the higher venture capital’s tolerance for technological innovation failure, the better the performance of the company’s technological innovation. The heterogeneity of venture capital is further examined. We find venture capitals that invest jointly, with foreign-funded or governmental backgrounds can positively regulate the effect of tolerance on performance. However, in industries where innovation is of high difficulty, participation of government venture capital inhibits this effect. Our conclusions provide enlightenment for improving companies’ technological innovation performance.KEYWORDS: Venture capitaltechnological innovationtolerance for failureinnovation performanceVC heterogeneity Disclosure statementNo potential conflict of interest was reported by the author(s).Additional informationFundingThis work was supported by the Anhui University of Finance and Economics [ACYC2020409]; Humanity and Social Science Research Project of Anhui Educational Committee [SK2019A0473]; Humanity and Social Science Research Project of Anhui Educational Committee [SK2020A0027].","PeriodicalId":45890,"journal":{"name":"Asia-Pacific Journal of Accounting & Economics","volume":"312 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-10-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136098124","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-09-23DOI: 10.1080/16081625.2023.2257219
Thuy Thu Nguyen, Trang Thu Nguyen
ABSTRACTWith a sample of 28 commercial banks in Vietnam – an emerging market – this study applies the generalized movement model estimation technique (GMM-SYS) to examine the influences of income diversification and credit risk on bank stability (measured by Z-score) spanning from 2010 to 2020. The empirical findings document the significant impacts of income diversification and credit risk, together with specified macroeconomic and bank-specific indicators, on bank stability. A threshold analysis, in addition, quantifies the recommendation changes in NPL and LLP to contribute to bank stability. Some policy implications are subsequently withdrawn to promote the stability of Vietnamese commercial banks.KEYWORDS: Bank stabilityincome diversificationcredit riskemerging market Disclosure statementNo potential conflict of interest was reported by the author(s).Notes1. Industry 4.0 is the digital transformation of manufacturing/production, related industries, and value creation processes. Cyber-physical systems form the basis of Industry 4.0 (e.g. ‘smart machines’). They use modern control systems, embedded software systems, and dispense with an internet address to connect and address the IoT (the Internet of Things).2. Basel III (the Third Basel Accord) is a global regulatory framework on bank capital adequacy, stress testing, and liquidity risk. It deals with the deficiencies in financial regulation revealed by the financial crisis of 2007–08.3. World Bank Report, Global Development Horizons 2011 – Multipolarity: The New Global Economy.4. The Association of Southeast Asian Nations.5. GCC member countries include Bahrain, Kuwait, Oman, Qatar, United Arab Emirates, and Saudi Arabia.6. MENA is an English-language acronym referring to the Middle East and North Africa. It is alternatively called the WANA, referring to the West Asia and North Africa region.7. https://data.worldbank.org/indicator8. https://www.gso.gov.vn/en/statistical-data/9. The theory and notation for GMM presented herein follow the study of Hayashi (Citation2000). Further discussions of GMM are provided in Ferson (Citation1995), Hall (Citation2005), Greene (Citation2004) and Ogaki (Citation1992).10. Threshold regression method was developed for non-dynamic panels with individual-specific fixed effects. The method was applied to a 15-year sample of 565 US firms to test whether financial constraints affect investment decisions (Hansen Citation1999).11. This index was developed independently by the A.O. Hirschman (Citation1945) and O.C. Herfindahl (Citation1950).12. Although the pandemic has heavily disrupted the economy, Vietnam’s GDP growth rate remained one of the highest in the Asia-Pacific Region, at 2.91% in 2020. In January 2021, it was projected to increase to 3.8% in 2021.13. VAMC (Vietnam Asset Management Company) is a state-owned company and supervised by the State Bank. Its principal activities are purchasing from credit institutions, debt collection, debt sale, and handling co
{"title":"Income diversification, credit risk and bank stability: evidence from an emerging market","authors":"Thuy Thu Nguyen, Trang Thu Nguyen","doi":"10.1080/16081625.2023.2257219","DOIUrl":"https://doi.org/10.1080/16081625.2023.2257219","url":null,"abstract":"ABSTRACTWith a sample of 28 commercial banks in Vietnam – an emerging market – this study applies the generalized movement model estimation technique (GMM-SYS) to examine the influences of income diversification and credit risk on bank stability (measured by Z-score) spanning from 2010 to 2020. The empirical findings document the significant impacts of income diversification and credit risk, together with specified macroeconomic and bank-specific indicators, on bank stability. A threshold analysis, in addition, quantifies the recommendation changes in NPL and LLP to contribute to bank stability. Some policy implications are subsequently withdrawn to promote the stability of Vietnamese commercial banks.KEYWORDS: Bank stabilityincome diversificationcredit riskemerging market Disclosure statementNo potential conflict of interest was reported by the author(s).Notes1. Industry 4.0 is the digital transformation of manufacturing/production, related industries, and value creation processes. Cyber-physical systems form the basis of Industry 4.0 (e.g. ‘smart machines’). They use modern control systems, embedded software systems, and dispense with an internet address to connect and address the IoT (the Internet of Things).2. Basel III (the Third Basel Accord) is a global regulatory framework on bank capital adequacy, stress testing, and liquidity risk. It deals with the deficiencies in financial regulation revealed by the financial crisis of 2007–08.3. World Bank Report, Global Development Horizons 2011 – Multipolarity: The New Global Economy.4. The Association of Southeast Asian Nations.5. GCC member countries include Bahrain, Kuwait, Oman, Qatar, United Arab Emirates, and Saudi Arabia.6. MENA is an English-language acronym referring to the Middle East and North Africa. It is alternatively called the WANA, referring to the West Asia and North Africa region.7. https://data.worldbank.org/indicator8. https://www.gso.gov.vn/en/statistical-data/9. The theory and notation for GMM presented herein follow the study of Hayashi (Citation2000). Further discussions of GMM are provided in Ferson (Citation1995), Hall (Citation2005), Greene (Citation2004) and Ogaki (Citation1992).10. Threshold regression method was developed for non-dynamic panels with individual-specific fixed effects. The method was applied to a 15-year sample of 565 US firms to test whether financial constraints affect investment decisions (Hansen Citation1999).11. This index was developed independently by the A.O. Hirschman (Citation1945) and O.C. Herfindahl (Citation1950).12. Although the pandemic has heavily disrupted the economy, Vietnam’s GDP growth rate remained one of the highest in the Asia-Pacific Region, at 2.91% in 2020. In January 2021, it was projected to increase to 3.8% in 2021.13. VAMC (Vietnam Asset Management Company) is a state-owned company and supervised by the State Bank. Its principal activities are purchasing from credit institutions, debt collection, debt sale, and handling co","PeriodicalId":45890,"journal":{"name":"Asia-Pacific Journal of Accounting & Economics","volume":"42 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135965978","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-09-15DOI: 10.1080/16081625.2023.2257242
Yanyi Ye, Jingjing Zhu, Bin Li, Xiaoguang Yang
ABSTRACTThis paper examines the relationship between extreme climate risks and offering yield spreads using a comprehensive dataset of Chinese corporate bonds issued by publicly listed firms from 2014 to 2020. We find that extreme climate risks are positively associated with firms’ offering yield spreads. This effect is more pronounced for bonds with long maturity, firms in climate-sensitive industries, and firms with lower ROE. Two economic channels are identified to explain the effect of climate risks on offering yield spreads: default risk and investor sentiment. Our results remain robust to a series of robustness tests.KEYWORDS: extreme climate risksoffering yield spreadscorporate bondsdefault riskinvestor sentiment AcknowledgmentsWe are grateful to the editor and the anonymous reviewers for their valuable comments and suggestions that helped improve our paper significantly. This paper is supported by the National Natural Science Foundation of China (Nos.72103017,T2293771) and Humanities and Social Sciences Fund of the Ministry of Education (No.21YJA790028). Any errors are our own.Disclosure statementNo potential conflict of interest was reported by the authors.Data availability statementThis paper collects data from trustworthy platforms (i.e. CSMAR, Wind, National Meteorological Science Data Sharing Service Platform). The data are not publicly available due to privacy or ethical restrictions.Additional informationFundingThis work was supported by the National Natural Science Foundation of China [72103017, T2293771]; Humanities and Social Sciences Fund of the Ministry of Education [21YJA790028].
{"title":"Extreme climate risks and corporate bond yield spreads: evidence from China","authors":"Yanyi Ye, Jingjing Zhu, Bin Li, Xiaoguang Yang","doi":"10.1080/16081625.2023.2257242","DOIUrl":"https://doi.org/10.1080/16081625.2023.2257242","url":null,"abstract":"ABSTRACTThis paper examines the relationship between extreme climate risks and offering yield spreads using a comprehensive dataset of Chinese corporate bonds issued by publicly listed firms from 2014 to 2020. We find that extreme climate risks are positively associated with firms’ offering yield spreads. This effect is more pronounced for bonds with long maturity, firms in climate-sensitive industries, and firms with lower ROE. Two economic channels are identified to explain the effect of climate risks on offering yield spreads: default risk and investor sentiment. Our results remain robust to a series of robustness tests.KEYWORDS: extreme climate risksoffering yield spreadscorporate bondsdefault riskinvestor sentiment AcknowledgmentsWe are grateful to the editor and the anonymous reviewers for their valuable comments and suggestions that helped improve our paper significantly. This paper is supported by the National Natural Science Foundation of China (Nos.72103017,T2293771) and Humanities and Social Sciences Fund of the Ministry of Education (No.21YJA790028). Any errors are our own.Disclosure statementNo potential conflict of interest was reported by the authors.Data availability statementThis paper collects data from trustworthy platforms (i.e. CSMAR, Wind, National Meteorological Science Data Sharing Service Platform). The data are not publicly available due to privacy or ethical restrictions.Additional informationFundingThis work was supported by the National Natural Science Foundation of China [72103017, T2293771]; Humanities and Social Sciences Fund of the Ministry of Education [21YJA790028].","PeriodicalId":45890,"journal":{"name":"Asia-Pacific Journal of Accounting & Economics","volume":"205 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-09-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135435877","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-06-20DOI: 10.1080/16081625.2023.2225536
Yi Ru, Wei Zhao, Zihao Su
We examine whether directors’ and officers’ liability insurance (D&O insurance) influences managers’ strategic tone manipulation of management discussion and analysis. We find that D&O insurance is positively associated with upward tone manipulation. This association is more pronounced for firms with greater litigation risk or highly-motivated and overconfident managers. Additionally, we document more favorable short-term returns and intensive reversals responding to positive tones issued by D&O insurance-covered firms. Besides, D&O insurance-shielded managers may inflate the tone by reducing risk-factor information disclosures. Overall, our results support that D&O insurance can trigger managers’ unethical manipulations by reducing their expected personal legal liability.
{"title":"Faithful or fearless: directors’ and officers’ liability insurance and management discussion and analysis tone manipulation","authors":"Yi Ru, Wei Zhao, Zihao Su","doi":"10.1080/16081625.2023.2225536","DOIUrl":"https://doi.org/10.1080/16081625.2023.2225536","url":null,"abstract":"We examine whether directors’ and officers’ liability insurance (D&O insurance) influences managers’ strategic tone manipulation of management discussion and analysis. We find that D&O insurance is positively associated with upward tone manipulation. This association is more pronounced for firms with greater litigation risk or highly-motivated and overconfident managers. Additionally, we document more favorable short-term returns and intensive reversals responding to positive tones issued by D&O insurance-covered firms. Besides, D&O insurance-shielded managers may inflate the tone by reducing risk-factor information disclosures. Overall, our results support that D&O insurance can trigger managers’ unethical manipulations by reducing their expected personal legal liability.","PeriodicalId":45890,"journal":{"name":"Asia-Pacific Journal of Accounting & Economics","volume":"5 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-06-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135187178","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-05-30DOI: 10.1080/16081625.2023.2216708
Mingyuan You, Xinruo Wang, Joanna (Jingwen) Zhao
ABSTRACTThis paper studies the effect of share pledges on earnings persistence and the mechanism that explains the effect. We find that both the existence of share pledges and the percentages of pledged shares are negatively related to firms’ earnings persistence, and the results are robust to the DID analysis. Our results indicate that firms with share pledges are more likely to engage in upward earnings management, resulting in diminished earnings persistence. We further find that the negative effect of share pledges on earnings persistence is most significant among non-SOEs, followed by local government-controlled SOEs, and insignificant among central government-controlled SOEs. The effect is mitigated when firms are subject to better audit monitoring or have higher institutional ownership.KEYWORDS: Share pledgeearnings persistenceearnings management AcknowledgmentsWe thank Dr. Jie Wang from Xi’an University of Posts & Telecommunications for his excellent work of data processing and the formation of the research structure.Disclosure statementNo potential conflict of interest was reported by the authors.Notes1. Controlling shareholders are defined as shareholders who possess the ultimate decision making of the firms (Pang and Wang Citation2020).2. This statistic comes from Table 1 of this paper.3. This statistic comes from Table 1 of this paper.4. A-shares are the publicly traded stock shares of mainland China-based companies.5. ST is Special Treatment. If a firm is listed with ST label, it indicates the firm received a risk warning by the stock exchange. ST* indicates delisting risk.6. We also performed coefficient correlation analysis. The result is available upon request.7. Due to space limitations, the following tests show the results of only the dependent variable CROA. The results of the dependent variable ROA are consistent with the results of CROA.8. We also performed robustness tests such as the Heckman two-stage estimation, propensity score matching and using alternative measures of earnings persistence (including the autoregressive model of earnings per share, the DD model, and a relaxed measurement period of earnings persistence in model (1) to t + 2 and t + 3.) The results are available upon request.9. We use the Discretionary Accrual (DA) to measure the degree of earnings management. We first follow Jones (1991)’s model and run following regression.TAi,t=NIi,t−CFOi,t （6–1）TAi,tAi,t−1=β11Ai,t−1+β2ΔREVi,tAi,t−1+β3PPEi,tAi,t−1+εi,t （6–2）In the model, for firm i, NIi,t is net income of year t. CFOi,t is net cash flow of operations of year t. PPEi,t is value of property, plant, and equipment at the end of year t. Ai,t−1 is total assets at the end of year t-1. Δ REVi,t is core business revenue of year t minus it of year t-1. Then we follow Dechow, Sloan and Sweeney (1995) to calculate DA. The model is as follows:DAi,t=TAi,tAi,t−1−β1ˆ1Ai,t−1−β2ˆΔREVi,tAi,t−1−ΔRECi,tAi,t−1−β3ˆPPEi,tAi,t−1 （6–3）Δ RECi,t is receivables of year t minus it of
{"title":"Share pledge and earnings persistence: evidence from China","authors":"Mingyuan You, Xinruo Wang, Joanna (Jingwen) Zhao","doi":"10.1080/16081625.2023.2216708","DOIUrl":"https://doi.org/10.1080/16081625.2023.2216708","url":null,"abstract":"ABSTRACTThis paper studies the effect of share pledges on earnings persistence and the mechanism that explains the effect. We find that both the existence of share pledges and the percentages of pledged shares are negatively related to firms’ earnings persistence, and the results are robust to the DID analysis. Our results indicate that firms with share pledges are more likely to engage in upward earnings management, resulting in diminished earnings persistence. We further find that the negative effect of share pledges on earnings persistence is most significant among non-SOEs, followed by local government-controlled SOEs, and insignificant among central government-controlled SOEs. The effect is mitigated when firms are subject to better audit monitoring or have higher institutional ownership.KEYWORDS: Share pledgeearnings persistenceearnings management AcknowledgmentsWe thank Dr. Jie Wang from Xi’an University of Posts & Telecommunications for his excellent work of data processing and the formation of the research structure.Disclosure statementNo potential conflict of interest was reported by the authors.Notes1. Controlling shareholders are defined as shareholders who possess the ultimate decision making of the firms (Pang and Wang Citation2020).2. This statistic comes from Table 1 of this paper.3. This statistic comes from Table 1 of this paper.4. A-shares are the publicly traded stock shares of mainland China-based companies.5. ST is Special Treatment. If a firm is listed with ST label, it indicates the firm received a risk warning by the stock exchange. ST* indicates delisting risk.6. We also performed coefficient correlation analysis. The result is available upon request.7. Due to space limitations, the following tests show the results of only the dependent variable CROA. The results of the dependent variable ROA are consistent with the results of CROA.8. We also performed robustness tests such as the Heckman two-stage estimation, propensity score matching and using alternative measures of earnings persistence (including the autoregressive model of earnings per share, the DD model, and a relaxed measurement period of earnings persistence in model (1) to t + 2 and t + 3.) The results are available upon request.9. We use the Discretionary Accrual (DA) to measure the degree of earnings management. We first follow Jones (1991)’s model and run following regression.TAi,t=NIi,t−CFOi,t （6–1）TAi,tAi,t−1=β11Ai,t−1+β2ΔREVi,tAi,t−1+β3PPEi,tAi,t−1+εi,t （6–2）In the model, for firm i, NIi,t is net income of year t. CFOi,t is net cash flow of operations of year t. PPEi,t is value of property, plant, and equipment at the end of year t. Ai,t−1 is total assets at the end of year t-1. Δ REVi,t is core business revenue of year t minus it of year t-1. Then we follow Dechow, Sloan and Sweeney (1995) to calculate DA. The model is as follows:DAi,t=TAi,tAi,t−1−β1ˆ1Ai,t−1−β2ˆΔREVi,tAi,t−1−ΔRECi,tAi,t−1−β3ˆPPEi,tAi,t−1 （6–3）Δ RECi,t is receivables of year t minus it of","PeriodicalId":45890,"journal":{"name":"Asia-Pacific Journal of Accounting & Economics","volume":"131 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-05-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135643415","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-03-08DOI: 10.1080/16081625.2023.2186902
Meng-Yi Tai, Shih‐Wen Hu, C. Chao
ABSTRACT The COVID-19 pandemic has negatively affected the tourist markets of many countries. This study develops a small, open macro model of tourism to analyze the price and revenue effects of establishing tourism target zones on tourism revenue in response to industry disturbances resulting from the pandemic. Such target zones improve tourism revenue and stabilize the economy by stabilizing tourism goods prices and exchange rates when domestic or foreign demand is strong and regardless of whether national borders are open. A tourism goods price subsidy can be employed to revitalize the tourism industry and improve tourism revenue after the pandemic.
{"title":"Pandemic, tourism, and the economy: a tourism-revenue target zone approach","authors":"Meng-Yi Tai, Shih‐Wen Hu, C. Chao","doi":"10.1080/16081625.2023.2186902","DOIUrl":"https://doi.org/10.1080/16081625.2023.2186902","url":null,"abstract":"ABSTRACT The COVID-19 pandemic has negatively affected the tourist markets of many countries. This study develops a small, open macro model of tourism to analyze the price and revenue effects of establishing tourism target zones on tourism revenue in response to industry disturbances resulting from the pandemic. Such target zones improve tourism revenue and stabilize the economy by stabilizing tourism goods prices and exchange rates when domestic or foreign demand is strong and regardless of whether national borders are open. A tourism goods price subsidy can be employed to revitalize the tourism industry and improve tourism revenue after the pandemic.","PeriodicalId":45890,"journal":{"name":"Asia-Pacific Journal of Accounting & Economics","volume":"8 2 1","pages":"1659 - 1674"},"PeriodicalIF":1.1,"publicationDate":"2023-03-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"83512793","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-03-04DOI: 10.1080/16081625.2021.1993074
Yi-Hui Tai, Chih-Yang Tseng
ABSTRACT Investor conference has been adapted from conference call but allows substantial managerial controllability over its timing and disclosures during the meeting. The announcement of holding such a meeting is posited to have information content. We examine investors’ positive prospect utilizing the announcements during growth period of Taiwanese semiconductor supply chain (TSSC). TSSC’s disintegration into upstream, midstream, and downstream firms further allows tests for information transfer vertically among three subgroups. We find supportive evidence that all three subgroups show significantly positive cumulative abnormal returns surrounding the upstream firm’s announcement of an upcoming investor conference. Notably, the spillover effect is stronger for industry peers with shorter vertical distance to the announcing firm.
{"title":"Information content of holding investor conferences: the case of Taiwan’s semiconductor supply chain","authors":"Yi-Hui Tai, Chih-Yang Tseng","doi":"10.1080/16081625.2021.1993074","DOIUrl":"https://doi.org/10.1080/16081625.2021.1993074","url":null,"abstract":"ABSTRACT Investor conference has been adapted from conference call but allows substantial managerial controllability over its timing and disclosures during the meeting. The announcement of holding such a meeting is posited to have information content. We examine investors’ positive prospect utilizing the announcements during growth period of Taiwanese semiconductor supply chain (TSSC). TSSC’s disintegration into upstream, midstream, and downstream firms further allows tests for information transfer vertically among three subgroups. We find supportive evidence that all three subgroups show significantly positive cumulative abnormal returns surrounding the upstream firm’s announcement of an upcoming investor conference. Notably, the spillover effect is stronger for industry peers with shorter vertical distance to the announcing firm.","PeriodicalId":45890,"journal":{"name":"Asia-Pacific Journal of Accounting & Economics","volume":"44 1","pages":"429 - 447"},"PeriodicalIF":1.1,"publicationDate":"2023-03-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85570105","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":4,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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