scholarly journals Discretionary Disclosure in Financial Reporting: An Examination Comparing Internal Firm Data to Externally Reported Segment Data

2011 ◽  
Vol 86 (2) ◽  
pp. 417-449 ◽  
Author(s):  
Daniel A. Bens ◽  
Philip G. Berger ◽  
Steven J. Monahan
Keyword(s):  
Financial Reporting ◽  
Agency Cost ◽  
Census Bureau ◽  
Proprietary Costs ◽  
Level Data ◽  
Discretionary Disclosure ◽  
External Reporting ◽  
Firm Data ◽  
Plant Level ◽  
Segment Data

ABSTRACT: We use confidential, U.S. Census Bureau, plant-level data to investigate aggregation in external reporting. We compare firms’ plant-level data to their published segment reports by grouping a firm’s plants that share the same four-digit SIC code into a “pseudo-segment.” We then determine whether each pseudo-segment is disclosed as an external segment, or whether it is subsumed into a different business unit for external reporting purposes. We show that a pseudo-segment is more likely to be aggregated when the agency and proprietary costs of separately reporting the pseudo-segment are higher and when firm and pseudo-segment characteristics allow for more discretion in the application of segment reporting rules. For firms reporting multiple external segments, aggregation of pseudo-segments is driven by both agency and proprietary costs. For firms reporting a single external segment, we find no evidence of an agency cost motive for aggregation.

scholarly journals Pollution Abatement Expenditure by U.S. Manufacturing Plants: Do Community Characteristics Matter?

2003 ◽  
Vol 3 (2) ◽  
Author(s):  
Randy A Becker
Keyword(s):  
Pollution Abatement ◽  
Census Bureau ◽  
Community Characteristics ◽  
Abatement Costs ◽  
Manufacturing Plants ◽  
Pollution Haven ◽  
Level Data ◽  
Per Capita ◽  
Plant Level ◽  
Air Pollution Abatement

Abstract This paper examines whether community characteristics impact the air pollution abatement (APA) activity at nearby manufacturing plants, using establishment-level data from the U.S. Census Bureau’s Pollution Abatement Costs and Expenditures (PACE) survey. Controlling for facility characteristics and various forms of formal environmental regulation, certain community characteristics are found to have additional effects on local APA expenditures. In particular, for the most pollution-intensive industries, larger per capita income is found to increase plant-level APA activity, as is a higher degree of homeownership, a greater concentration of Democratic voters, and being located in a metropolitan area. Meanwhile, a greater presence of manufacturing employees is found to decrease APA expenditures, suggesting a constituency that is more resistant to additional regulation. If local populations can indeed affect pollution abatement activity, they can impact the spatial distribution of pollution, thereby creating pollution haven effects.

Financial Reporting for Pollution Reduction Programs

2020 ◽  
Vol 66 (12) ◽  
pp. 6015-6041
Author(s):  
Yonca Ertimur ◽  
Jennifer Francis ◽  
Amanda Gonzales ◽  
Katherine Schipper
Keyword(s):  
Financial Reporting ◽  
Fair Value ◽  
International Accounting Standards ◽  
Cap And Trade ◽  
Alternative Treatments ◽  
Income Volatility ◽  
Business Combinations ◽  
Current Period ◽  
Level Data ◽  
Plant Level

We develop a conceptually grounded approach, based on the International Accounting Standards Board’s conceptual framework, to the accounting for the rights and obligations embodied in a cap-and-trade program. Under this approach, firms recognize allowances as intangible assets, initially measured at fair value with a credit to cash for purchased allowances and to a current period gain for allocated allowances; firms recognize current period expense and accrue liabilities, at fair value, as they emit; both asset and liability are remeasured at fair value at every reporting date. We apply our treatment and three alternative treatments, based on current practice and proposals considered by standard setters, to transaction-level data from the U.S. sulfur dioxide cap-and-trade program to calculate as-if financial statement outcomes using actual data. The alternative treatments result in noncomparable accounting for otherwise similar arrangements. To provide ex ante evidence on the effects of noncomparable accounting, we analyze reporting outcomes and show that alternative accounting treatments of the same arrangement result in meaningful differences in reported assets and liabilities, income volatility, and commonly used performance and leverage metrics. Because the financial reporting effects of noncomparable accounting are exacerbated by business combinations and plant-level purchases of allocated allowances that may have been initially recorded at zero, our analysis explicitly accounts for the effects of these transactions. Finally, we find that among the four accounting treatments we consider, reporting outcomes under our proposed approach are most aligned with investor perceptions, as indicated by the associations between the market value of equity and assets, liabilities, and income. This paper was accepted by Shiva Rajgopal, accounting.

Anonymized Firm Data under Test: Evidence from a Replication Study

2005 ◽  
Vol 225 (5) ◽  
Author(s):  
Joachim Wagner
Keyword(s):  
Cross Sections ◽  
Statistical Significance ◽  
Original Data ◽  
Replication Study ◽  
Firm Level ◽  
Level Data ◽  
Practical Usefulness ◽  
Order Of Magnitude ◽  
Anonymized Data ◽  
Firm Data

SummaryThis paper contributes to the literature on the use of anonymized firm level data by reporting results from a replication study. To test for the practical usefulness of anonymized data I selected two of my published papers based on different cross sections of firm data. The data used there were anonymized by micro aggregation. I replicated the analyses reported in the papers with the anonymized data, and then compared the results to those produced with the original data. Frequently, the reported levels of statistical significance differ. Furthermore, statistically significant coefficients sometimes differ by order of magnitude. Therefore, at least for the moderate sample sizes used here micro-aggregated firm data should not be considered as a tool for empirical research.

Bypassing weak institutions in a large late-comer economy

2015 ◽  
Vol 11 (4) ◽  
pp. 847-874 ◽  
Author(s):  
EVGUENIA BESSONOVA ◽  
KSENIA GONCHAR
Keyword(s):  
Institutional Environment ◽  
Political Conflict ◽  
Round Trip ◽  
Weak Institutions ◽  
Institutional Determinants ◽  
Level Data ◽  
Development Levels ◽  
Plant Level ◽  
Source Countries

AbstractThis paper addresses the link between the strong inflow of FDI into Russia in the 2000s and its weak institutions, using plant-level data across subnational regions. The findings imply that investors have responded positively to improved quality of institutions in certain regions, which offered a combination of wealth, skills and good infrastructure. High development levels in host regions helped to bypass some institutional shortcomings. Investors from source countries exhibiting comparable institutional environment appeared to be more immune to political conflict. Round-trip investors reacted to institutional determinants in almost the same manner as genuine investors, except for tolerance to labor market imperfections.

scholarly journals Harnessing Agricultural Potentials for Economic Growth in North Carolina

2013 ◽  
Vol 2 (2) ◽  
pp. 142 ◽  
Author(s):  
Janaranjana Herath ◽  
David Hill
Keyword(s):  
Economic Growth ◽  
North Carolina ◽  
Work Force ◽  
Census Bureau ◽  
Agricultural Activities ◽  
Income Levels ◽  
Rural Counties ◽  
Level Data ◽  
Education And Employment ◽  
Bureau Of Labor Statistics

Agriculture in North Carolina contributes to 19 percent of the state’s income and employs over 20 percent of the work force. Agricultural activities are significant in rural counties and nearly 30 percent of the total population of North Carolina lives in 85 rural counties. Individuals in these rural counties have less income, education, and employment opportunities eventually in high poverty and unemployment rates. The objective of this study is to examine the potential use of agriculture in economic growth of North Carolina using county level data. Data were gathered from U.S. Bureau of Labor Statistics, U.S. Department of Agriculture, and U.S. Census Bureau for the period of 2000 to 2010. A system of simultaneous equations is used for the analysis. Results highlight that increasing income increases agricultural activities and vise versa. Thus, the counties with high household income levels are more capable of incorporating agriculture in economic growth while the counties with significant agricultural activities are more competent of improving income levels. Overall, results conclude the importance of secured satisfactory level of income through agriculture to enhance economic growth.

scholarly journals Public disclosure of industrial pollution: the PROPER approach for Indonesia?

2007 ◽  
Vol 12 (6) ◽  
pp. 739-756 ◽  
Author(s):  
JORGE H. GARCÍA ◽  
THOMAS STERNER ◽  
SHAKEB AFSAH
Keyword(s):  
Pollution Control ◽  
Positive Response ◽  
Oxygen Demand ◽  
Asian Financial Crisis ◽  
Control Group ◽  
Public Disclosure ◽  
Emissions Reductions ◽  
Level Data ◽  
Control Evaluation ◽  
Plant Level

ABSTRACTThis paper evaluates the effectiveness of the Program for Pollution Control Evaluation and Rating (PROPER) in Indonesia. PROPER, the first major public disclosure program in the developing world, was launched in June 1995; though it collapsed in 1998 with the Asian financial crisis, it is currently being revived. There have been claims of success for this pioneering scheme, yet little formal and conclusive analysis has been undertaken. We analyze changes in emissions concentrations (mg/L) using panel data techniques with plant-level data for participating firms and a control group. The results show that there was indeed a positive response to PROPER, especially among firms with poor environmental compliance records. The response was immediate, and firms pursued further emissions reductions in the following months. The total estimated reductions in biochemical oxygen demand (BOD) and chemical oxygen demand (COD) were approximately 32 per cent.

Organizational Form and Trade Liberalization: Plant-Level Evidence

2021 ◽  
Author(s):  
John (Jianqiu) Bai
Keyword(s):  
Trade Liberalization ◽  
Core Competency ◽  
Extensive Margin ◽  
Trade Policies ◽  
Trade Shocks ◽  
Internal Organization ◽  
Level Data ◽  
Plant Level ◽  
The Impact ◽  
Aggregate Industry

This paper studies how firms’ internal organization shapes the impact of international trade. Using establishment-level data from the U.S. Census and a difference-in-difference specification, I find that, relative to standalone firms, conglomerates are more likely to restructure after trade liberalization episodes, focusing on their core competency and improving firm productivity and product market performance. Adjustments through the extensive margin account for the majority of the productivity growth differential between conglomerates and standalones experiencing trade shocks. Aggregate industry productivity remains relatively unchanged in industries dominated by conglomerates’ core business but decreases significantly in others. My findings suggest that firms’ internal organization has important consequences on the effects of trade policies. This paper was accepted by Gustavo Manso, finance.

scholarly journals Internal Labor Markets, Wage Convergence, and Investment

2020 ◽  
pp. 1-36
Author(s):  
Rui C. Silva
Keyword(s):  
Labor Markets ◽  
Free Trade Agreement ◽  
State Level ◽  
Capital Intensity ◽  
Trade Agreement ◽  
Internal Labor Markets ◽  
The North ◽  
Level Data ◽  
Wage Convergence ◽  
Plant Level

Abstract I document wage convergence in conglomerates using detailed plant-level data: Workers in low-wage industries collect higher-than-industry wages when the diversified firm also operates in high-wage industries. I confirm this effect by exploiting the implementation of the North American Free Trade Agreement (NAFTA) and changes in minimum wages at the state level as sources of exogenous increases in wages in some plants. I then track the evolution of wages of the remaining workers of the firm, relative to workers of unaffiliated plants. Plants where workers collect higher-than-industry wages operate with higher capital intensity, suggesting that internal labor markets may affect investment decisions in internal capital markets.

scholarly journals Import Liberalization of Intermediates and Environment: Empirical Evidence from Chinese Manufacturing

2019 ◽  
Vol 11 (9) ◽  
pp. 2579 ◽  
Author(s):  
Ling-Yun He ◽  
Liang Wang
Keyword(s):  
Manufacturing Sector ◽  
Firm Level ◽  
Intermediate Inputs ◽  
Interaction Terms ◽  
Level Data ◽  
Plant Level ◽  
Pollution Emissions ◽  
The Impact ◽  
Scale Composition ◽  
Level Lowering

This paper investigates how the import liberalization of intermediates affects firm-level pollution emissions. We divide the impact of freer import of intermediates on pollution emissions into induced scale, composition and technique effects and then develop interaction terms to examine these effects. Relying on a panel of plant-level data from China manufacturing sector for the period 2001 to 2007, we find freer import of intermediate inputs is conducive to pollution reductions at the plant level, lowering pollution via induced technique and composition effects and, in turn, increasing emission through induced scale effect. In summary, import liberalization of intermediate inputs can contribute to the better environmental performance of China manufacturing sector.

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