Downward Nominal Price Rigidity and Earnings Persistence

2015 ◽  
Author(s):  
Jin Xie
Keyword(s):  
Price Rigidity ◽  
Earnings Persistence

Competition Policy under Economic Crisis

2009 ◽  
pp. 54-69 ◽  
Author(s):  
A. Shastitko ◽  
S. Avdasheva ◽  
S. Golovanova
Keyword(s):  
Division Of Labor ◽  
Economic Crisis ◽  
Industrial Policy ◽  
Competition Policy ◽  
Transition Economy ◽  
Economic Recession ◽  
Price Rigidity ◽  
Key Factor ◽  
Policy Measures ◽  
The Impact

The analysis of competition policy under economic crisis is motivated by the fact that competition is a key factor for the level of productivity. The latter, in its turn, influences the scope and length of economic recession. In many Russian markets buyers' gains decline because of the weakness of competition, since suppliers are reluctant to cut prices in spite of the decreasing demand. Data on prices in Russia and abroad in the second half of 2008 show asymmetric price rigidity. At least two questions are important under economic crisis: the 'division of labor' between pro-active and protective tools of competition policy and the impact of anti-crisis policy on competition. Protective competition policy is insufficient in transition economy, especially in the days of crisis it should be supplemented with the well-designed industrial policy measures which do not contradict the goals of competition. The preferable tools of anti-crisis policy are also those that do not restrain competition.

Exchange Rate and Import Price Rigidity in Russia

2017 ◽  
Author(s):  
Yuriy Ponomarev ◽  
Yury Andreevich Pleskachev
Keyword(s):  
Exchange Rate ◽  
Import Price ◽  
Price Rigidity

An Analysis of the Sources of Value Loss Following Financial Restatements

2021 ◽  
pp. 0148558X2198991
Author(s):  
Philip K. Hong ◽  
Jaywon Lee ◽  
Sang-Hyun Park ◽  
Sukesh Patro
Keyword(s):  
Stock Returns ◽  
Cash Flow ◽  
Discount Rate ◽  
Stock Price ◽  
Cash Flows ◽  
Financial Fraud ◽  
Earnings Persistence ◽  
Flow Component ◽  
Financial Restatements ◽  
Value Loss

We decompose the total value loss around firms’ announcements of financial restatements into components arising from investors’ revisions in cash flows and discount rates. First, relative to population benchmarks, restatements represent circumstances in which the cash flow component becomes more important in explaining valuations. While we find significant contributions from both sources, with the cash flow component explaining more than 33% of the variation in stock returns surrounding restatement announcements, this component explains only 13% to 22% in comparable non-restating firms. When restatements are caused by underlying financial fraud, the discount rate impact becomes more important, explaining about 88% of return variation. On the contrary, the cash flow impact is relatively larger for firms with higher earnings persistence or restatements associated with errors. Our decomposition of the value loss helps explain returns in the post-announcement period. Firms with a higher relative discount rate impact experience a significant downward stock price drift after the initial announcement-related price decline. For firms with a higher relative cash flow impact, the evidence suggests the initial impact of the restatement announcement is more complete with no subsequent drift pattern. Our findings close gaps in the evidence on financial restatements and extend the literature on the drivers of stock price movements.

scholarly journals Almost‐Maximization as a Behavioral Theory of the Firm: Static, Dynamic and Evolutionary Perspectives

2019 ◽  
Vol 56 (2) ◽  
pp. 237-258
Author(s):  
Huw Dixon
Keyword(s):  
Dynamic Behavior ◽  
Firm Behavior ◽  
Theory Of The Firm ◽  
Behavioral Theory ◽  
Price Rigidity ◽  
Price Setting ◽  
Term Survival ◽  
Sales Revenue ◽  
Evolutionary Perspectives

Abstract In this paper we consider the effect of epsilon maximization on firm behavior. In particular we focus on the dynamic behavior of firms with the use of the example of price‐setting: We show how almost-rational firms can be more volatile in their behavior. However, if a lexicographic preference for simplicity is made, then we can explain nominal price rigidity as a result of epsilon optimization. The behavior of the firm—which is consistent with its long‐term survival—is examined. We argue that epsilon-optimization is consistent with survival in any context in which something is optimized: such as sales revenue.

Earnings persistence and schooling returns

2013 ◽  
Vol 118 (3) ◽  
pp. 482-484 ◽  
Author(s):  
Corrado Andini
Keyword(s):  
Earnings Persistence
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