Government Costs Research Articles

African swine fever in China: Impacts, responses, and policy implications

African Swine Fever broke out in China in August 2018 and has caused a substantial loss to China’s hog industry. Pork is the dominant meat in the Chinese diet with its price being a critical component of China’s Consumer Price Index. In 2019, large increases in the pork price caused by the sharp reduction in pork supply incentivized the government to suppress the price by subsidizing large-scale hog farms. With an updated estimation of China’s meat demand, we argue that the ongoing policy interventions may not be the most efficient for achieving short-run reductions in the pork price. Subsidizing the production of chicken, a major substitute for pork and currently accounting for a relatively small share of meat consumption in China, could help suppress the pork price faster and at lower government costs. We estimate price dynamics and compute consumer surplus of multiple subsidy plans over a 30-month window from the third quarter of 2019 to the last quarter of 2021. Simulation outcomes suggest that allocating some subsidies from hog to chicken farms is likely to benefit consumers, producers, and the government. Our novel proposal of expanding production of a substitute meat to help lower the pork price after a large loss of the hog stock may be useful to other countries that suffer or may suffer from severe livestock losses due to animal epidemics.

Impact of Cost of Governance on the Socio-Economic Development in Nigeria: 1999 to 2019

This study is an examination of the implications of the cost of governance on socio-economic development in Nigeria using Secondary data. The study found that of the over 20 years of uniterrupted democracy, there has been high petroleum revenue and borrowing for various deficit budgeting. This is accompanied by high recurrent and less capital budgeting which makes the negligible resources left to be used for capital projects, unable to encourage the desired socio-economic development. Some factors responsible for this high cost of governance are discussed amongst which are; the size and structure of governance, duplication of government functions and corruption. It is the conclusion of this study that the cost of maintaining government institutions is very high without anything to show for it. The study recommends accountability and infrastructural development to move to a better level, Nigeria’s present state of socio-economic development.

Does the charter form lead to lower borrowing costs? Examining the case of California local governments

AbstractIn this paper, we examine the impact of the charter form of government on the borrowing costs of local governments. A substantial amount of research has been undertaken to date in which scholars have investigated the determinants of borrowing costs for governments. However, little research has been conducted hitherto on the impact that the particular form of government – a key issuer characteristic – has on determining its specific borrowing costs. We hypothesized that a chartered government is more likely to be able to reduce its borrowing costs when it is benefiting from the municipal bond market; a government's flexibility and professionalism is desirable. We tested this hypothesis by using city and county government bond data from California that dates from 2003 to 2015. In our findings, we show that the financial flexibility that is afforded by a charter helps local governments to improve their credit ratings and to lower their borrowing costs.

An experimental study of RyO Kit for Covid-19 information sharing in rural islands of Indonesia

Indonesia is among the most suffering countries due to Covid-19 pandemic. The government is still challenged to manage the delivery of Covid-19 related information since many of inhabitants living in rural islands. This aims to offer low cost and simple solution for government in delivering Covid-19 information in rural islands without adequate telecommunications infrastructure. The technical solution is based on Raspberry Pi technology called RyO (Raspberry Outernet) Kit. We examined RyO Kit based on four parameters namely signal strength, signal quality, bit rate and quota. Final results confirmed RyO Kit is appropriate solution to deal with the issue.

Do Cross-Listed Firms Have a Better Governance Structure and Lower Agency Costs? Evidence from Chinese Firms

This study examines whether an influence from a difference in corporate governance structure exists on firms’ agency costs between Chinese companies cross-listed on the Hong Kong Stock Exchange (HKSE) and those that are domestically listed ones. We determine that, overall, companies with an HKSE cross-listing had better corporate governance than those without. The corporate governance advantage of the HKSE cross-listed firms holds if we control for firm fixed effects and resolve the potential endogeneity problem between corporate governance and agency costs by using two-stage least square (2SLS) regression analysis with instrumental variables. Specifically, the HKSE cross-listed firms had better corporate governance in terms of board size and institutional ownership. By contrast, domestically listed firms experienced the adverse effects of institutional owner’s roles and higher board pay. The advantages of HKSE cross-listed firms may stem from the benefits of having a larger board size and the effective monitoring of the management by the institutional stockholders. Implications are drawn for the debate on cross-listing and the future challenges of Chinese firms, and a more robust monitoring is necessary for sustainable finance of their stock markets.

Does Mycobacterium tuberculosis var. bovis Survival in the Environment Confound Bovine Tuberculosis Control and Eradication? A Literature Review.

Bovine tuberculosis (bTB) is one of the globe's most common, multihost zoonoses and results in substantial socioeconomic costs for governments, farming industries, and tax payers. Despite decades of surveillance and research, surprisingly, little is known about the exact mechanisms of transmission. In particular, as a facultative intracellular pathogen, to what extent does survival of the causative agent, Mycobacterium tuberculosis var. bovis (M. bovis), in the environment constitute an epidemiological risk for livestock and wildlife? Due largely to the classical pathology of cattle cases, the received wisdom was that bTB was spread by direct inhalation and exchange of bioaerosols containing droplets laden with bacteria. Other members of the Mycobacterium tuberculosis complex (MTBC) exhibit differing host ranges, an apparent capacity to persist in environmental fomites, and they favour a range of different transmission routes. It is possible, therefore, that infection from environmental sources of M. bovis could be a disease transmission risk. Recent evidence from GPS-collared cattle and badgers in Britain and Ireland suggests that direct transmission by infectious droplets or aerosols may not be the main mechanism for interspecies transmission, raising the possibility of indirect transmission involving a contaminated, shared environment. The possibility that classical pulmonary TB can be simulated and recapitulated in laboratory animal models by ingestion of contaminated feed is a further intriguing indication of potential environmental risk. Livestock and wildlife are known to shed M. bovis onto pasture, soil, feedstuffs, water, and other fomites; field and laboratory studies have indicated that persistence is possible, but variable, under differing environmental conditions. Given the potential infection risk, it is timely to review the available evidence, experimental approaches, and methodologies that could be deployed to address this potential blind spot and control point. Although we focus on evidence from Western Europe, the concepts are widely applicable to other multihost bTB episystems.

When the going gets tough, the goal-committed get going: overcoming the transaction costs of inter-agency collaborative governance

ABSTRACT Collaborative governance, despite being a fraught endeavour, is sometimes the only option for addressing cross-agency problems. From 2012 to 2017, the New Zealand government’s flagship programme was an inter-agency collaborative governance regime focussed on achieving outcome targets. An earlier study attributed the programme’s success to sociotechnical features that reduced ‘transaction costs’. A subsequent study found this inconsistent with an emic (insider) perspective from public managers. Goal commitment was presented as an alternative, underexplored explanation for success despite high transaction costs. The two explanations are reconciled by Identifying common design features that contribute to successful inter-agency collaborative governance.

Technical Efficiency of Chemical Fertilizer Use and Its Influencing Factors in China’s Rice Production

Low technical efficiency and excessive usage of chemical fertilizer in grain production is a problem commonly faced by China and many other developing countries, which leads to serious environment pollution and high environmental governance cost. China is the largest rice producing and consuming country, and several kinds of rice are grown in China and all of which are important edible grain. However, there has been no systematic research on kind difference and provincial difference of technical efficiency of chemical fertilizer use (TEFU) for rice production. Using the data of China’s 22 rice production provinces from the China Agricultural Product Cost-Benefit Compilation and the China Statistical Yearbook, this study measures the TEFU for early indica rice, intermediary indica rice, late indica rice, and japonica rice production by using a stochastic frontier production function (SFPF) model, and then analyzes TEFU’s influencing factors using a Tobit model and conducts the robustness check using a panel data fixed effect model. We found that, on average, TEFU for four kinds of rice production were improved significantly during 1997–2018, increasing by 67.70%, 39.93%, 14.76%, and 21.88%, respectively. TEFU for China’s rice production have significant differences among different kinds and production provinces, and still have large improvement potential. Government’s fiscal support to agriculture, agricultural labor productivity, agricultural mechanization, effective irrigation, and implementation of the “Soil Testing and Formulated Fertilization Program” (STFFP) have significant positive impact on TEFU; and natural disaster and fertilizer price have significant negative impact on TEFU.

Does financial disclosure matter? GASB 45 and municipal borrowing costs

ABSTRACT Financial disclosure is crucial to achieve fiscal transparency and government accountability. In 2004, the Governmental Accounting Standards Board (GASB) issued Statement No. 45 to require the disclosure of information about other postemployment benefits (OPEB). Using a panel of U.S. counties and the bonds they issued between 1999 and 2012, this paper examines the effects of GASB 45 on municipal borrowing costs. GASB 45 increases borrowing costs of county governments, with the effects decreasing over time. GASB 45 has a larger effect on borrowing costs of county governments issuing bonds of lower credit quality and adopting the generally accepted accounting standards (GAAP).

Corporate governance, ownership structure and agency costs: evidence from Sri Lanka

The purpose of this paper is to examine the link between corporate governance, ownership structure and agency cost in Sri Lanka. The present study uses the regression model to analyse data for a sample of 150 firms listed in the Colombo Stock Exchange (CSE) for the financial years 2014 to 2018. The empirical results show statistically significant and positive associations between board size, CEO duality, managerial ownership and agency cost proxies (i.e., asset turnover and expense ratio). The results also show a positive and significant relationship between the independent directors and asset turnover (though statistically insignificant with expense ratio), suggesting that, entrenched independent directors employ lower conflict of interest in order to reduce the agency cost. Nonetheless, ownership concentration, was statistically insignificantly associated with agency costs, this paper provides support for such a view in Sri Lankan context. This study contributes to the literature on the on the association between corporate governance, ownership structure and agency costs. The findings may be useful for financial managers, investors, financial management consultants, and other stakeholders.

The Effects of Contract Detail and Prior Ties on Contract Change: A Learning Perspective

Despite the large literature on alliance contract design, we know little about how transacting parties change and amend their underlying contracts during the execution of strategic alliances. Drawing on existing research in the alliance contracting literature, we develop the empirical question of how contract detail and prior ties influence the amount, direction, and type of change in such agreements during the collaboration. We generated a sample of 115 joint ventures (JVs) by distributing a survey to JV board members or top managers and found that the amount of contract change is negatively associated with the level of detail in the initial contract but is positively associated with the number of prior ties between alliance partners. In relation to the direction of contract change, we find that the level of detail of the initial agreements negatively correlates with the likelihood of removing or weakening existing provisions and that prior collaborative experience positively correlates with the likelihood of strengthening of existing provisions or adding of new ones. We also find that prior ties affect the type of change in that JV parents prefer to change enforcement provisions more so than the coordination provisions in the contract. Our paper generates new insights on the complementarities between relational governance and transaction cost economics perspectives on alliance contracting.

The Frail Bonds of Liberalism: Pensions, Schools, and the Unraveling of Fiscal Mutualism in Postwar New York

Between 1940 and 1965, state-level officials changed the relationship between two pillars of the postwar social contract: secure retirement and modern public schools. In the early twentieth century, state pension managers, following an investment regime we call “fiscal mutualism,” funneled the savings of government workers into government securities. Through direct participation in municipal bond markets, pension officials lowered the borrowing costs for local governments. Yet by the 1960s, pensions had completely abandoned this investment regime. We document this transformation through a close examination of New York State’s pension fund. Throughout the 1950s, the comptrollers who managed the New York State Employee Retirement System (NYSERS), the nation’s largest state pension, underwrote the boom in suburban school construction by purchasing the municipal bonds of local school districts. However, in response to changes in national political economy, along with shifts in the ideology guiding pension stewardship, New York Comptroller Arthur Levitt Sr. sought to deregulate the pension’s investment powers. Following the regulatory changes, Levitt disinvested from municipal bond holdings in favor of higher-yielding corporate securities. Pension deregulation secured higher returns for state retirees, but it also forced local school districts to enter bond markets without the backstop of fiscal mutualism. As school budgets, and the property taxes supporting them, soared to repay the interest costs, tax revolts became a permanent response to the fiscal volatility. These transformations, we argue, stemmed from postwar liberalism’s dependence on financial markets to deliver retirement security, public education, and other social benefits. This public dependence on private capital foreclosed more ambitious policy alternatives and ceded power to private actors—particularly investment bankers and bond investors—who prioritized their own profits over social welfare provision.

Remote supervision strategy based on in-use vehicle OBD data flow

Test results from many researchers show that NOx emissions from parts of on-road heavy-duty diesels are higher than which been registered. Therefore, CN_VI emission regulations clearly proposes that the heavy-duty diesels should be supervised by a T-BOX which can transmit CAN message from vehicle OBD interface to the remote monitoring platform. Recognition of cheating behaver and calculation method of NOx emission were developed and verified by platform data from on-line vehicle. The modules in the platform can effectively monitor urea consumption rationality, injection system working state, exhaust temperature sensor signal reasonability, NOx sensor signal reasonability and NOx emission level, which can reduce the cost of supervision and governance, improve the effectiveness of regulation and provide basic data for policy making.

What determines the risk-pricing of local state-owned enterprise bond in China?

Focusing on local state-owned enterprise (SOE) bond credit spreads in China during the period 2013 to 2020, we disentangle a province premia component from firms' fundamentals and present evidence of an increasing subnational debt market fragmentation since 2018, which is shown to be associated with previous local SOE default incidences and local government fiscal space. An endogenously estimated local debt to GDP threshold that would exert impact on the province premia is found to be lower than the debt sustainability thresholds suggested by the World Bank and the IMF. Our study sheds lights on the needs for a more market-based risk-pricing and its important implications on debt market functioning, as well as the hidden cost of local government debts beyond its conventional sustainability concerns.

Corporate Governance and Agency Costs in Non-Financial Listed Companies in Sri Lanka

Corporate Governance and Agency Costs in Non-Financial Listed Companies in Sri Lanka

Do Foreign Institutional Investors Affect International Contracting? Evidence from Bond Covenants

We examine the impact of foreign institutional investors on the prevalence of restrictive bond covenants using a sample of 959 Yankee bonds from 29 countries over the period 2001–2019. We find a significantly negative relation between foreign institutional ownership and debt cov-enants. This inverse relation is strongest for U.S. institutional ownership of foreign-issued Yan-kee bonds, and for covenants designed to mitigate such opportunistic behavior as claims dilu-tion and wealth transfers. We also show that the inverse relation between U.S. institutional ownership and restrictive debt covenants is moderated by country- and firm-level variables re-lated to corporate governance, information asymmetry, and agency costs of debt. Additional analyses show that U.S. institutional ownership has a significant pricing effect on Yankee bond investors by lowering the issuer’s cost of borrowing.

Blockchain: Effects in Transactions Costs from Information Governance

ABSTRACT This research aims to analyze the effects of the adoption of blockchain on information governance and transaction costs. We present an exploratory, quantitative, and qualitative study. In the first stage, quantitative, a theoretical model was developed and tested based on structural equation modeling (PLS-SEM). Data collection was carried out through an online survey with IT and management professionals involved in blockchain projects from different countries. In the second stage, qualitative, a multiple case study was carried out in order to illustrate how the relations of the developed model are established. In the quantitative phase, the study’s hypotheses were supported and it was observed that the adoption of blockchain technology can be seen as a mechanism to reduce transaction costs, since it has a positive impact on information governance. In the qualitative phase, it was observed that, in the three cases analyzed, characteristics such as information security, transparency, and the possibility.

The mediating effect of financial reporting quality on corporate governance effectiveness and cost of debt

The mediating effect of financial reporting quality on corporate governance effectiveness and cost of debt

Study on Equilibrium Relationship Between Government Regulation and Social Environmental Responsibility of Energy Enterprises

This paper uses the evolutionary game model to analyze the relationship between government regulation and social environmental responsibility of energy enterprises. Then, we use the Matlab to simulate the dynamic change between government regulation and social environmental responsibility of energy enterprises. The conclusion of the study shows that: (1) The strategic choice based on corporate social environmental responsibility is must be the green technology innovation, and if we want to the maximum profit, we need to find a balance between government regulation and corporate social environmental responsibility. (2) Whether the government supervises enterprise, whether an enterprise fulfills its social environmental responsibility, depends on the specific circumstances. We must take an overall consideration of the cost of government, the bonuses, and penalties, the corporate different earnings because of different choices between fulfills and defaults its social responsibility, the bonuses the company achieved, the penalties the company must pay, and many other factors. The main contribution of this thesis is: break through the static research about the relationship between government and energy enterprise. We acquire the dynamic relation between government and energy enterprise based on green technology innovation. And it provides great help for our energy companies future direction of development.

Green Product Market Development Strategy of Mobile Network Group Buying Community: Based on Three‐Party Evolutionary Game and Simulation Analysis

With the advent of the 5G era, the mobile network group buying community dominated by focusing on social relations shows great development potential. However, in the mobile network group buying community, the mixed information makes the information environment of the community more complex. Information asymmetry will lead to “mistakes” in consumers’ choice, making it impossible for some important markets to be fully developed. Considering the gains and losses of three interest subjects—governments, enterprises, and consumers in the green product market under information symmetry, in this paper, an evolutionary game model involving governments, enterprises, and consumers was built. Numerical experiments and simulation were performed using SciPy, a scientific computing library of Python, to study the main factors influencing the healthy development of the green product market. The research results showed under information symmetry, when the governments’ benefit from increased government credibility was higher than the cost of governments for screening the information of enterprises’ products and identifying the green products, the expected fine of enterprises for producing high carbon products was higher than the difference between the actual cost increment and the actual income increment of enterprises for producing green products, and the utility perception of consumers from purchasing green products was higher than the cost of consumers for purchasing green products, the three‐party game would evolve to a socially ideal stable state. The above conclusions provide useful policy suggestions for governments to vigorously develop the green product market.