During the past two years similar petroleum tax reforms have been proposed in Norway and Denmark. Both were based on results on neutral taxation derived by Boadway and Bruce (1984) and Fane (1987). Main features of the proposals are presented, and important problems of implementation are highlighted. Topics for further research are pointed out. While the risk characteristics of tax deductions c...

This paper presents an integrated analysis of production and financing decisions. We construct a model in which a cash storage unit is installed to manage the cash flows associated with production activities such as raw material procurement, process operating setup, inventory holding costs and finished product sales. Temporary financial investments are allowed to increase profit. The production...

Constant pressure to increase return on assets has firms seeking ways to reduce their working capital costs. In the cash management area, firms are employing more sophisticated collection and disbursement systems. Cash management systems today efficiently speed up collections and, at the end of the day, sweep excess balances into money market accounts. Cash managers focus on finding the optimal...

A n entrepreneur is an individual with a project blueprint and limited wealth. If launching the project requires expenses that exceed the entrepreneur’s initial wealth, he needs outside financing. Entrepreneurs differ from “hired management” in that they are indispensable for the firm’s day-to-day operations. This is because entrepreneurs add value to companies perpetually, rather than by handi...

This paper presents an overview of information-based asset pricing. In the information-based approach, an asset is defined by its cash-flow structure. The market is assumed to have access to “partial” information about future cash flows. Each cash flow is determined by a collection of independent market factors called X-factors. The market filtration is generated by a set of information process...

In this study, I investigate whether market learning explains the absence of the accrual anomaly in recent years by examining three conditions associated with the presence of the anomaly in prior research: (i) a differential relation between future earnings and cash flows versus accruals, (ii) incorrect weighting of cash flows and accruals by investors when predicting earnings, and (iii) associ...

A n entrepreneur is an individual with a project blueprint and limited wealth. If launching the project requires expenses that exceed the entrepreneur’s initial wealth, he needs outside financing. Entrepreneurs differ from “hired management” in that they are indispensable for the firm’s day-to-day operations. This is because entrepreneurs add value to companies perpetually, rather than by handi...

Seasoned equity offerings (SEOs) are sales of stock after the initial public offering. They are a means to raise funds through the sale of stock rather than the issuance of additional debt. We propose a method to predict the characteristics of firms that undertake this form of financing. Our procedure is based on logistic regression where firm-specific variables are obtained from the perspectiv...