Pre-incorporation contracts revisited

Some confusion still exists with Accountants as to the correct accounting treatment for pre-incorporation contracts. An attempt is made in this article to present a framework of the legal positions and accounting treatments of all practical situations encountered with pre-incorporation contracts.http://www.tandfonline.com/loi/rsar19am2018Accountin

Speculation in Standard Auctions with Resale

According to the theory of incomplete contracts, given nonverifiable entrepreneurial project choices together with divergent objectives between an entrepreneur and its outside financier, the entrepreneur can credibly pledge only part of its project outcome for external funding. Meanwhile, entrepreneurial net worth must be put as down payment to ameliorate agency costs. In a real dynamic general equilibrium model with heterogeneous agents and nonverifiable project choices, endogenous agency costs significantly change the businesscycle pattern in the sense that the model can replicate an important empirical fact, the amplified hump-shaped output behavior. Furthermore, variable asset prices can a ect entrepreneurial net worth and then subsequently change the dynamic features of aggregate output along business cycles.Asset Prices, Business Cycles, Credit Constraints, Hump-Shaped Output Dynamics, Nonverifiable Project Choice

Economic history : Sold, American! : how auction markets improved the tobacco trade and why they are becoming obsolete

Tobacco industry ; Auctions

College Football Coaches’ Pay and Contracts: Are They Overpaid and Unfairly Treated?

College football coaches’ employment contracts and compensation garner public attention and scrutiny in much the same way as those of corporate CEOs. In both cases, the public perception is that they must be overpaid and pampered. Economic theory claims that for coaches and CEOs to be overpaid, they must be receiving compensation in excess of the value they create for their organizations. However, both receive pay-for-performance compensation, which structurally aligns their compensation with value creation. This means we need to examine the underlying structure of the contract that gives rise to the observed compensation to determine whether they are appropriately compensated. We compare the employment contracts of Division I Football Bowl Subdivision (FBS) college football coaches with those of corporate CEOs during the period 2005 to 2013. We find that coaches are not overpaid, and their contracts are fairly drawn. We also show that CEO and coach contracts exhibit many common features. These contract features are consistent with what economic theory would predict

“To Bid or Not to Bid, This is the Question: The Italian Experience in Competitive Tendering for Local Bus Services”

Competitive tendering is a popular mechanism for the provision of local bus services when a major objective is subsidy savings. Despite uncertainties in the legal rules some competitive tendering was implemented in Italy since 1998. The evidence so far is that participants were limited in number, the incumbents were almost everywhere able to gain the franchise, whilst subsidy savings were in many cases negligible. If some “political” conditions favouring more effective tendering procedures are not fulfilled, other regimes should be considered in order to obtain substantial subsidy savings.Local bus services; Competitive Tendering

Firm development as an integrated process: with evidence from the General Motors-Fisher Body case

This paper argues that an adequate approach to the firm should be able to accommodate the complexities of actual firm development. The latter is conceptualized in terms of three general stages: prime movers or drivers of change, change processes, and change attractors. Furthermore, any "real-world" firm is both a technical and an institutional unit. To emphasize the importance of "real firm" analysis, the discussion presented here revolves around an understanding of the much considered case of General Motors and Fisher Body integration has developed over time. Generalization from this case suggests that an integrated view of the firm is necessary that combines the three stages and the two bases (technical and institutional). Six general perspectives on the firm are identified as having technical or institutional bases that are relevant in each of the three stages. This integrated approach to the firm is explored in terms of the general topic of firm development. It is concluded that, without an integrated approach to firm development, a potentially biased or incomplete analysis can result