Implementing the Great American Outdoors Act in the Era of Sustainable Recreation: Time for a Mission 2030?

The Great American Outdoors Act (AGOA) fully and permanently funds the Land and Water Conservation Fund for the first time since it was created in 1964. This is a boon for purchasing conservation lands, but equally important, the act provides funding to address massive federal agency recreation infrastructure backlogs. The last major overhaul of the U.S. parks and outdoor recreation system was over 50 years ago, during the era of Mission 66 and related programs. Since that time, a host of environmental and societal changes necessitates new approaches for updating conservation and recreation opportunities. In addition to acquiring critical park and conservation lands, and developing and updating facilities, new park and recreation goals include increasing public use and visitor diversity and advancing environmental justice, public health, and large-scale conservation goals. Integrated systems analyses are needed to address these diverse concerns across landscapes, regions, and jurisdictions, and new interagency and interdisciplinary approaches will be needed. This is a bureaucratic crossroads: for the first time in decades we can truly advance public access, human health, and social equity values of public lands; the GAOA is a critical process step toward, but not the culmination of, this goal.

The impact of intangible intensity on relevance of R&D information: evidence from India

PurposeThis paper aims to examine the impact of the intangible intensity of the firm on the relevance of research and development (R&D) information to determine equity values in India. Additionally, the study compares the association of input information on R&D investment (the reported R&D cost) and output information on R&D investment (patent count) with equity values. Further, the study also examines the operational nature of the firm and patent count, which is the better proxy to measure the intangible intensity of the firm.Design/methodology/approachThe authors compared the explanatory power of R&D information between intangible and non-intangible intensive firms. To estimate the value relevance of R&D information, the authors followed the statistical model based on the theoretical framework of the residual income model.FindingsThe results indicate that there is a significant moderating impact of the intangible intensity of the firm on the relevance of R&D information to determine equity values in India over the 25 years study period (from 1991 to 2016). Further, in India, the study finds that the input information of R&D outlay is more relevant than output information on R&D outlay to determine equity values, irrespective of the proxy measure of intangible intensity. Moreover, the study finds that the operational nature of the firm is a better proxy of the intangible intensity of the firm compared to patent counts.Research limitations/implicationsIn this study, pooled cross-sectional data were used for analysis. In the future, longitudinal and panel data can be used for more insightful results.Practical implicationsThe findings of the study provide direction to investors and creditors to find the intrinsic value of the investments in internally developed intangible assets, which will reduce the asymmetry between the market value and accounting value of equity.Originality/valueThe paper offers insights into the impact of intangible intensity on the relevance quality of R&D information in an emerging country.

Sweat Equity in U.S. Private Business*

We develop a theory of sweat equity—the value of business owners’ time and expenses to build customer bases, client lists, and other intangible assets. We discipline the theory using data from U.S. national accounts, business censuses, and brokered sales to estimate a value for sweat equity in the private-business sector equal to 1.2 times U.S. GDP, which is about the same magnitude as the value of fixed assets in use in these businesses. For a typical owner, 26 percent of the sweat equity is transferable through inheritance or sale. The equity values are positively correlated with business incomes and standard measures of markups based on accounting data, but not with owners’ financial assets or standard measures of business total factor productivity. We use our theory to show that abstracting from sweat activity leads to a significant understatement of the impacts of lowering business income tax rates on private-business activity for both the extensive and intensive margins. Despite finding larger responses, our model’s implied tax elasticities of establishments and owner hours are in line with empirical estimates in the public finance literature. Allowing for financial constraints and superstar firms does not overturn our main findings.

Earnings Expectations during the COVID-19 Crisis*

We analyze the dynamics of earnings forecasts and discount rates implicit in valuations during the COVID-19 crisis. Forecasts over 2020 earnings have been progressively reduced by 16%. Longer-run forecasts have reacted much less. We estimate an implicit discount rate going from 8.5% in mid-February to 11% at the end of March and reverting to its initial level in mid-May. Over the period, the unlevered asset risk premium increases by 50bp, the leverage effect also increases by 50bp, while the risk free rate decreases by 100bp. Hence, analysts’ forecast revisions explain all of the decrease in equity values between January 2020 and mid-May 2020. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

PENGARUH KESADARAN MEREK, CITRA MEREK, LOYALITAS MEREK TERHADAP EKUITAS MEREK (Studi kasus pada penggunaan smartphone Xiaomi di Batam)

Technological developments continue to increase in various fields, one of which is in the field of cellular telephones, one of the companies established to enter this intense market competition is Xiaomi. There are 3 equity values of the products used in this study, namely Brand awareness, Brand Image, Brand Loyalty that will affect the Brand Equity of this Xiaomi product. This study aims to see how the three elements influence the value of brand equity. The results showed that brand awareness, brand image, brand loyalty influence brand equity simultaneously and brand image, brand loyalty affects brand equity partially while brand awareness does not partially affect brand equity.Keywords: Brand Awareness, Brand Image, Brand Loyalty, Brand Equity

The Role of Sustainability in Brand Equity Value in the Financial Sector

The behavior of firms is changing as new kinds of businesses evolve. In particular, companies are now seeking to optimize their value, especially their intangible value—referred to as brand equity value—which has many behavioral drivers. The analysis of brand equity determinants in the financial sector (e.g., ethical investments, sustainability and firm behavior) has received little attention. The methodology used in this study included the collection of information from publicly listed companies, followed by the execution of a statistical analysis to study the correlations between brand equity values and their determinants. We aimed to close this gap by raising the awareness of the positive impacts of sustainable investments in the financial sector and the need for a managerial implementation model to build a sustainability-oriented brand value. The objective of this research was to examine the relationships between elements such as sustainability scores or diversity measures and firms’ brand value. Considering sectoral and regional effects, we observed a positive relationship between environmental and social governance scores and brand equity value.

Value relevance of R&D reporting in India: significance of intangible intensity

Purpose Fundamental shifting of the world toward intangible intensive economy raised an apprehension regarding value relevance of internally generated intangible assets. In the previous studies, research and development (R&D) expenditure is recognized as a significant accounting item, which can indicate potential internally generated intangible assets. This study aims to examine whether investors consider nature of intangible intensity of a firm for the evaluation of R&D expenditure to determine equity values in India. Design/methodology/approach The authors compared value relevance of capitalized and the expensed portion of R&D expenditure between intangible- and non-intangible-intensive firms. They adopted empirical model grounded on the generalized version of Ohlson’s (1995) model. Findings The findings of the study indicate that, in intangible-intensive (non-intangible) firms, the capitalized portion of expenditure is positively (negatively) significant and the expensed portion of R&D expenditure is negatively (positively) significant to explain equity values. Practical implications The findings of this study may have potential implication for the discussion on the accounting treatment of internally generated intangible assets based on the nature of intangible intensity of the firm. The study also suggests that while setting standards, standard-setters should consider nature of intangible intensity of the firm, which could disseminate the discrepancy between the market and book value of the equity. Originality/value The study provides evidence, how value relevance of R&D reporting is affected by the nature of intangible intensity of a firm.

The Debt-Equity Choice When Regulatory Thresholds are Based on Equity Values: Evidence from SOX 404

ABSTRACT When larger market values of equity result in being subject to costly regulation, firms have incentives to shift their sources of financing toward debt and away from equity. We use the Sarbanes-Oxley Act of 2002 (SOX) as a setting to provide evidence of such incentives. Smaller firms were granted several reprieves and eventually exempted from the internal control audit requirements of SOX Section 404, which many consider the most costly and onerous aspect of SOX. Using a difference-in-differences design, we show that relative to control firms, firms just below the regulatory threshold have increased propensities to issue debt, decreased propensities to issue equity, and increased leverage levels in the post-SOX period. These results are consistent with firms altering their financing choices to maintain their exempt status and demonstrate an economic consequence of regulatory regimes that are tiered by equity values.

Sustainability of Leverage Levels in Response to Shocks in Equity Prices: Islamic Finance as a Socially Responsible Investment

This study looks at how firms react to shocks in equity prices based on a classification which arises from social pressures rather than the financial objective of maximizing shareholders’ wealth. In order to meet the objective of the study, a sample of Malaysian firms from the period of 2003 to 2018 was utilized to evaluate the relationship between market and book debt ratios based on a social distinction. The study is based on the theoretical expectation that managers are inclined to adjust book debt ratios to converge with market debt values which arise from changes in equity values over time. We introduce a unique institutional setting into the relationship which is readily observable in the Malaysian capital market given the existence of Shari’ah and non-Shari’ah compliant company classifications on the stock exchange (Bursa Malaysia), as screened by the Securities Commission. The classification forms the basis for distinguishing Socially Responsible Investment options for investors. The findings reveal the existence of asymmetries in how both categories of firms adjust towards shocks in equity prices. The findings document that both compliant and non-compliant firms decrease book debt ratios in line with increases in firms’ equity values. Compliant firms, on the other hand, are more likely to increase book debt ratios during periods of decreases in equity values. Non-compliant firms do not significantly alter book debt ratios during periods of declining equity prices. The findings indicate that whilst firms tend to decrease debt levels in the presence of future growth potential, the response is asymmetric during periods of suppression of share prices. Thus, the screening of compliant versus non-compliant firms allows investors to distinguish sustainable firms in the long run, which further allows diversification when holding socially responsible investment portfolios. Our conclusions have wide reaching implications on a global scale for the development of sustainable capital markets.