The empirical CAPM: Estimation and Implications for the Regulatory Cost of Capital

<p>In calculating the cost of capital for regulated businesses, the New Zealand Commerce Commission uses the Capital Asset Pricing Model to estimate the cost of the equity component of capital, a procedure that involves assuming particular values for unobservable key parameters. This thesis proposes, instead, to estimate these parameters from market data. The principal result is that estimates of these parameters differ significantly from the values assumed by the Commerce Commission. Applying these estimates to two recent cases involving the electricity line and gas pipeline businesses, the estimated costs of capital for the entities involved are 3.5% to 5.5% more than those obtained by the Commission, but the associated confidence intervals are wider. One implication of these findings is that the Commissions approach systematically understates the uncertainty surrounding cost of capital estimates.</p>

The empirical CAPM: Estimation and Implications for the Regulatory Cost of Capital

<p>In calculating the cost of capital for regulated businesses, the New Zealand Commerce Commission uses the Capital Asset Pricing Model to estimate the cost of the equity component of capital, a procedure that involves assuming particular values for unobservable key parameters. This thesis proposes, instead, to estimate these parameters from market data. The principal result is that estimates of these parameters differ significantly from the values assumed by the Commerce Commission. Applying these estimates to two recent cases involving the electricity line and gas pipeline businesses, the estimated costs of capital for the entities involved are 3.5% to 5.5% more than those obtained by the Commission, but the associated confidence intervals are wider. One implication of these findings is that the Commissions approach systematically understates the uncertainty surrounding cost of capital estimates.</p>

Proteomic traits vary across taxa in a coastal Antarctic phytoplankton bloom

Production and use of proteins is under strong selection in microbes, but it is unclear how proteome-level traits relate to ecological strategies. We identified and quantified proteomic traits of eukaryotic microbes and bacteria through an Antarctic phytoplankton bloom using in situ metaproteomics. Different taxa, rather than different environmental conditions, formed distinct clusters based on their ribosomal and photosynthetic proteomic proportions, and we propose that these characteristics relate to ecological differences. We defined and used a proteomic proxy for regulatory cost, which showed that SAR11 had the lowest regulatory cost of any taxa we observed at our summertime Southern Ocean study site. Haptophytes had lower regulatory cost than diatoms, which may underpin haptophyte-to-diatom bloom progression in the Ross Sea. We were able to make these proteomic trait inferences by assessing various sources of bias in metaproteomics, providing practical recommendations for researchers in the field. We have quantified several proteomic traits (ribosomal and photosynthetic proteomic proportions, regulatory cost) in eukaryotic and bacterial taxa, which can then be incorporated into trait-based models of microbial communities that reflect resource allocation strategies.

Measuring CSR Disclosure when Assessing Stock Market Effects

A growing number of studies use a dichotomous variable indicating the presence of a standalone CSR report to capture impacts of CSR disclosure. Our concern is that, without considering differences in the information provided, such an approach could lead to incorrect inferences regarding those impacts. Accordingly, we extend prior research by examining whether, similar to differences in environmental disclosure, the mere presence of a standalone CSR report mitigates negative market reactions at times of regulatory cost exposure. We focus on the 2011 Fukushima Daiichi disaster and a sample of international utilities with nuclear power generation. Controlling for other factors related to social and regulatory cost exposures, we find only the environmental disclosures appear to reduce negative market effects. We thus argue that, in exploring the impacts of CSR disclosure, researchers need to carefully consider, beyond just the presence of a CSR report, differences in the extent of information being provided.

Research on the Information Tracing Model for Cross-border E-commerce Products based on Blockchain

Information asymmetry, information island, high regulatory cost, etc., emerge from the fast development of cross-border e-commerce in China, for which the blockchain, with its capabilities in information sharing, information traceability, smart contract, and so on, can play an effective role in product information tracing. Based on blockchain, this paper builds the product information tracing model using information chains of two different degrees of openness. The model includes the three major bodies of cross-border e-commerce—the supply chain alliance, the consumers and the regulatory departments, so as to produce information tracing, ensure information authenticity and integrity, and be applicable to all kinds of e-commerce platforms.

Barriers to innovation and willingness to innovate in the food sector: the case of Chile

PurposeThe goal of this research is to evaluate obstacles to innovation according to the perception of firms in the Chilean food sector, and to assess the relationships of these obstacles with innovation spending and willingness to innovate.Design/methodology/approachWe analyzed data from the Chilean National Innovation Survey (Encuesta Nacional de Innovación) of 2017 and 2019, which were administered by the Ministry of Economy and the National Institute of Statistics. This survey is designed to be nationally representative. The methods we employed to analyze the data include linear regression, probit and logit models and factor analysis.FindingsWe found that obstacles to innovation can be grouped into five types, namely: cost-based, knowledge-related, market problems, lack of necessity for innovations and regulatory. Cost was positively, and significantly, associated with innovation (expenditures and willingness to innovate). We argue that this is because as firms engage in innovation, they become aware of the associated costs. Also, knowledge obstacles and lack of necessity were negatively associated with innovation. This may mean that as firms engage in innovation, they are able to overcome said obstacles; which speaks well of their innovation ecosystem.Originality/valueWe develop the argument that survey-based studies of obstacles are amenable to a perception-based interpretation of obstacles, because most surveys tend to collect firms' perceptions. Consequently, we provide perception-based explanations for our findings. Additionally, most empirical studies of obstacles in the food sector are of a qualitative nature. Our work supplements this literature with a quantitative analysis that can expand our understanding of innovation in the food industry.