Fool Me Once, Shame on You; Fool Me Twice, Shame on Me: The Long-Term Impact of Arthur Andersen's Demise on Partners' Audit Quality*

Although recent evidence suggests that individual audit partners explain a substantial portion of the variation in audit quality proxies, much less is known about what determines an audit partner's quality. Psychology and behavioral economics theories hold that an individual's experiences can have enduring impacts on subsequent behavior. We examine whether auditors' direct exposure to Arthur Andersen's collapse has a long-term impact on the quality of their audits. Our evidence implies that audit partners who directly experienced Andersen's demise impose stricter monitoring evident in their clients exhibiting a lower propensity for misstatements and small profits, and paying higher audit fees. Importantly, these findings reconcile with research in finance and economics implying that firsthand experiences matter more to subsequent behavior than general economic conditions or secondhand or thirdhand experiences. Collectively, the results shed light on one facet of how partners' audit quality evolves over time. Our findings suggest that major failures associated with the audit firm in which an auditor works can ultimately result in these affected individuals later delivering higher audit quality, which should benefit audit committees in partner selection decisions and audit firms in designing partner assignment policies

Decomposing the differences in healthy life expectancy between migrants and natives: the ‘healthy migrant effect’ and its age variations in Australia

Whether the ‘healthy migrant effect’ exhibits different patterns in mortality and morbidity and how such patterns change during the life course have not been adequately understood in the literature. Using the datasets of the Australian Bureau of Statistics, this study presents an in-depth investigation of the healthy migrant effect and its age variations in Australia. Specifically, this study estimates life expectancy (LE) and healthy life expectancy (HLE) of the Australia-born and overseas-born populations, as well as eight Australian migrant groups, and decomposes the HLE differences into mortality and morbidity differences from three dimensions: age, gender and country of birth. The results reveal that compared with the Australia-born population, the overseas-born population enjoys a prominently longer LE; however, they suffer a similar or lower HLE after age 65 and a lower HLE/LE ratio throughout all ages. Young overseas-born adults manifest a more significant health advantage in both mortality and morbidity than early-life and older overseas-born individuals; however, the morbidity advantage of young migrants, particularly those who are female and originated from culturally different countries, declines dramatically with ageing. The results suggest that overall, migrants do not have the same advantage in morbidity as they do in mortality and that health advantages of migrants decreases with time in both dimensions of health and more rapidly for morbidity. The results suggest that pertinent policies are needed to reduce acculturation-related challenges and to mitigate the decline in migrants’ health in the post-migration environment to ensure better quality of life outcomes of migrants

Changing impact of COVID-19 on life expectancy 2019–2023 and its decomposition: Findings from 27 countries

Background: The World Health Organization declared COVID-19 no longer a global health emergency on 5th May 2023; however, the impact of COVID-19 on life expectancy throughout the pandemic period is not clear. This study aimed to quantify and decompose the changes in life expectancy during 2019–2023 and corresponding age and gender disparities in 27 countries. Methods: Data were sourced from the Human Mortality Database, the World Population Prospects 2022 and the United Kingdom's Office for National Statistics. Life expectancy was estimated using the abridged life table method, while differentials of life expectancies were decomposed using the age-decomposition algorithm. Results: There was an overall reduction in life expectancy at age 5 among the 27 countries in 2020. Life expectancy rebounded in Western, Northern and Southern Europe in 2021 but further decreased in the United States, Chile and Eastern Europe in the same year. In 2022 and after, lost life expectancy years in the United States, Chile and Eastern Europe were slowly regained; however, as of 7th May 2023, life expectancy in 22 of the 27 countries had not fully recovered to its pre-pandemic level. The reduced life expectancy in 2020 was mainly driven by reduced life expectancy at age 65+, while that in subsequent years was mainly driven by reduced life expectancy at age 45–74. Women experienced a lower reduction in life expectancy at most ages but a greater reduction at age 85+. Conclusions: The pandemic has caused substantial short-term mortality variations during 2019–2023 in the 27 countries studied. Although most of the 27 countries experienced increased life expectancy after 2022, life expectancy in 22 countries still has not entirely regained its pre-pandemic level by May 2023. Threats of COVID-19 are more prominent for older adults and men, but special attention is needed for women aged 85+ years