PCAOB Inspections and Market Repercussions; Is There A Relationship?

This study tests whether the PCAOB achieves its goals of issuing inspection reports that provide meaningful and value-adding information for external investment decisions, as measured by investor reaction. The study measures informative value by examining cumulative abnormal stock returns of all companies that had an auditor inspected in 2012. Also tested was \u27Big Four\u27 versus other annually inspected firms, as well as 12 significant industries. This study provides statistical evidence that investors respond to PCAOB inspection reports, the responses of which are typically positive. These results demonstrate that investors recognize inspection reports as value-relevant, and consquently use them to make informed investment decisions

Food Recalls and Food Safety Perceptions: The September 2006 Spinach Recall Case

This paper examines public perceptions on food safety particularly relating to spinach, which was subject of countrywide recall in 2006. Results indicate that food safety perceptions may be driven by public trust/confidence in institutions whose activities may be directly or indirectly related to food safety. The results further suggest that food safety perceptions may also be related to the type of the product; for example, the public perceives frozen spinach differently from bagged fresh spinach. Additionally, the results show that low levels of objective knowledge about food pathogens and the resulting illnesses have implications on overall food safety. Results further indicate that females and Caucasians perceived the four types of spinach as safe for consumption. This outcome contrasts with views held by young people, people with education below high school and those belonging to the lower incomes groups, who viewed the four types of spinach as unsafe. More attention should be directed toward public education and outreach efforts on overall food safety targeting the youth, low income groups and those with education below high school. In addition, there is need for the regulatory agencies to put their act together, given current low levels of public trust in their role of safeguarding the food supply.Food Consumption/Nutrition/Food Safety,

Russia: firm entry and survival

Why are there so few new firms in Russia? This paper provides further insights into the specific Russian business landscape and how it impacts the low level of new firm entry. As this paper indicates, internationally comparative data does not provide many clues since in terms of purely formal constraints, Russia fairs comparatively well. However, a deeper analysis uncovers the informal impediments associated with the lack of rule of law, inconsistent enforcement of regulations, regional autonomy and pervasive corruption. These informal constraints form impediments not only for new firm creation but also for firm survival and firm exit. Since not all industries are affected in the same way, this paper includes a comparison between a new and traditional industrial sector: software development and the textile industry