November 2013

Evaluation of Information Asymmetry in Financial Reporting: Other Approach, Other Result: New Evidence from Iran
Mahdi Salehi
Vahab Rostami

Abstract:  The results of this survey showed that preparers’ perception of accounting qualitative characteristics preferences and information asymmetry areas generally differ from those accounting profession members’ and especially auditors are less satisfi ed than accountants from current financial reporting accordance with qualitative characteristics. This finding in some aspect is in accordance with past fi nding by Mirshekary and Saudagaran (2005). Moreover, this study revealed that all of the respondents among six compared qualities are satisfied about condition of having sufficient comparability, considering timeliness in provision and reporting of information, same as having sufficient relevance, while they are more complaining of current condition of the lack of adequate disclosure, lack of sufficient reliability besides less considering cost-benefi t constraint in issuing new standard and providing accounting information and they believe forging cases are main factors of reducing the level of transparency and crating and wide spreading information asymmetry gap between contributors in those markets.

Key words: information asymmetry, financial reporting, Iran
JEL Classification: D82

 

An Analysis of Relationship between Remittances and Inflation in Pakistan
Anum Nisar
Saira Tufail

Abstract:  Remittances play a significant role in the economic development of recipient economy through different micro and macroeconomic channels. However, the adverse impact of remittances in the form of Dutch disease and inflation cannot be overlooked. This study aims to examine the impact of remittance on inflation and its different categories, namely, food inflation, footwear and textile inflation, housing and construction inflation. Accordingly, four vectors have been formulized to capture the determinants of overall inflation and its different categories with particular focus on remittances. The study employed Johansen (1990) and Johansen & Juselius (1990) cointegration technique to check the existence of long run relationship between remittances and inflation. Vector Error Correction technique is further applied to examine the extent and direction of relationship between variables and to check the stability of models. The results indicated the existence of one cointegrated vector for all equations. Moreover, remittances, money supply and real per capita income are found to have positive impact on inflation and its different categories. The results revealed that among different inflation categories food inflation is most effected and housing & construction inflation is least effected by remittances. Budget deficit is significant in reducing foot wear and textile inflation only. On the other hand trade openness is effective in reducing all types of inflation by same magnitude and strength. Given the inflationary nature of remittances it becomes necessary for government o channelize the remitted funds into productive investment to avoid surge in demand pull inflation.

Key words: remittances, Inflation, cointegration, VECM
JEL Classification: E31

 

Corporate Bankruptcy of Portuguese Firms
Cristiana P. Jardim
Elisabeth T. Pereira

Abstract:  Over the time has been increasing the interest in understanding the subjects of insolvency and bankruptcy due to its consequences for the country’s economic performance, and, actually, to its importance in the actual economic European context. The present work studies the evolution of bankruptcy of Portuguese fi rms in the last two decades, and obtains a set of macroeconomic factors which can explain this occurrence. It was considered the period 1990-2009, and the methodology used was a regression model including variables considerate in several empirical studies sustained in the literature review. The obtained results pointed to the relevance of macroeconomic variables as most signifi cant explanatory variables for the Portuguese case.

Key words: insolvency, bankruptcy, firms, internal and external causes, Portugal
JEL Classification: C22, G32, G33, D20

 

Market Efficiency and Information: A Literature Review
Christophe Boya

Abstract: This article tries to examine the efficiency market hypothesis. Therefore, the efficiency is studied through endogenous and exogenous information. The goal of this paper is to describe the literature review the most exhaustive of effiiency studies. We show that distinct conclusions can be emphasized following the type of analyzed information. Consequently, the endogenous information is not of quality to question the efficiency, rather than the exogenous one shows significant results. The exogenous information allows forecasting future stock returns, and earning profit. It is getting a decision making tool.

Key words:efficiency market, endogenous information, exogenous information
JEL Classification: G00, G14

 

Rural Areas and Gross Domestic Product in Some Countries of the Mediterranean Sea Basin
Nicola Galluzzo

Abstract: The transition from an agricultural productivist to a post productivist model has implied a change about the function and role of rural areas, that have an active part in reducing, through the multifunctionality, the social and economic exclusion in the countryside. This paper studies by a quantitative approach in some countries of the basin of the Mediterranean Sea which variables have been pivotal to improve the agricultural Gross Domestic Product (GDP) and per capita GDP over 8 years. The study has pointed out as there are relentless discrepancies among rural and urban areas in terms of income and its distribution.

Key words: rural areas, urban areas, panel data, rural population, Human Development Index
JEL Classification: Q10, R12