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Renowned brands and recycling agencies tacitly integrate their business flows together in the current trade-in industry. The collaborative trade-in programme breaks the hierarchy of closed-loop supply chains and provides seamless services for consumers. In this study, we develop a stylised model to capture the change in supply chain structure and scrutinise trade-in collaboration and recycling competition between sellers and recyclers. We find that, under intensive recycling competition, price targeting new consumers is downward distorted by the seller to occupy more trade-in demands in the old consumer segment. Meanwhile, the rebate of the recycler is suppressed by the collaboration constraint. By distorting the price, the seller obtains the predominance in recycling competition while sacrificing part of profits from new consumers. The price distortion indicates the competition spill-over from the old consumer segment to the new consumer segment. Furthermore, the establishment of autonomous recycling reaches a Pareto improvement for the whole system when the competition is mild; otherwise, these two entities fall into a zero-sum scenario. Our study offers insights into recycling value allocation and trade-in partner choice and, theoretically, contributes to the economic literature that price distortion can even be forced by competition with the absence of information asymmetry. [ABSTRACT FROM AUTHOR]

Smart services' data-intensive nature means their convenience for users comes with privacy concerns. This poses challenges for the supply of smart services. This paper analyses the impact of user-differentiated privacy costs on smart service supply strategies. It also discusses the effects of privacy protections and data utilisation capabilities on the improvement of smart service levels. We find that providers tend to segment the market based on user privacy sensitivity to capture the maximum consumer surplus. Strict privacy protection requirements may cause providers to sacrifice service quality. Privacy protection is conducive to improving the level of smart services only when users fully recognise these services' value. Interestingly, our study finds improvements in service levels by providers are driven by two factors. On the one hand, providers choose to improve their service levels to obtain more data and create more profits. On the other hand, to reduce the opportunity costs of early investments to develop services, providers need to improve their capabilities to utilise the value of data, ultimately leading to improved service levels. This study brings a new perspective to the supply of smart services and offers suggestions for how to resolve the contradiction between smart service use and privacy preservation. [ABSTRACT FROM AUTHOR]

Using a sample of Chinese listed firms from 2007 to 2017, this study investigates the impact of trust on corporate innovation. We find that firms located in provinces with higher trust levels have both higher innovation inputs and outputs, indicating trust plays an important role in promoting corporate innovation. We further document that this association is more pronounced for firms with a higher degree of information asymmetry between boards and managers, and when CEOs have stronger incentives to engage in opportunistic behavior in innovation activities. In addition, we find that forced CEO turnover-performance sensitivity is lower and managers are less likely to underinvest in R&D in high trust areas, suggesting trust enhances corporate innovation through relationship alignment between shareholders and managers. We also find that trust promotes not only the quantity but also the quality of corporate innovation. Our study complements existing research that investigates factors encouraging corporate innovation and extends a growing body of literature that examines the impact of trust on corporate decisions. [ABSTRACT FROM AUTHOR]

With the global expansion of business operations, many U.S. corporations now operate internationally. While these multinational corporations (MNCs) rely on information about their operations to allocate resources, this information is likely dispersed within the firm, leading to internal information asymmetry between top executives and divisional managers. Meanwhile, audits of these geographically dispersed MNCs are challenging, and parts of these audits are sometimes outsourced to local foreign auditors who have no experience serving as opinion-issuing auditors for U.S. issuers ("inexperienced component auditors"). In this article, we examine whether involving such inexperienced component auditors is associated with MNCs' internal information environment. We find that, relative to a matched control sample, Securities and Exchange Commission (SEC) issuers with the participation of inexperienced component auditors have higher internal information asymmetry and lower internal capital allocation efficiency. Our results suggest that audit quality matters not only to a firm's external financial statement users but also to its internal users. [ABSTRACT FROM AUTHOR]

The increasing complexity of 10-K reporting has caused difficulties for investors seeking to understand and analyze a company's financial reports. In this study, we examine whether the SEC's comment letter process, consistent with its mission to improve public company disclosure, reduces reporting complexity in subsequent filings. We find comment letter receipt has a competing impact on two distinct dimensions of reporting complexity. Specifically, reporting complexity related to accounting concepts decreases after comment letter receipt, but linguistic reporting complexity increases. Validating this competing impact, we find that both changes to complexity are associated with changes in firms' information asymmetry in the expected directions. Further analysis of the increase in linguistic reporting complexity suggests that managers obfuscate following comment letter receipt, where the increase is unnecessary and not occurring in response to changes in the firms' accounting or underlying economics/operations. Overall, results suggest that while the comment letter process simplifies the presentation of reported accounting information, it also has the unintended consequence of decreasing the readability of reports. This nuance is important to understand, given that the federal government dedicates significant resources to the comment letter process. [ABSTRACT FROM AUTHOR]

Governmental subsidy policy and channel information structure have substantial effects on supply chain emission reduction, operations and marketing decisions. In this paper, we use game theory to study the interplay of government subsidizing arrangement and information asymmetry on manufacturers' emission reduction and retailers' low-carbon promotion. Suppose realistically that the investment coefficients for manufacturers' emission reduction levels and retailer' low-carbon promotion levels are their respective private information. Among diverse governmental subsidy schemes, we find dual subsidizing are the best choice for the defined level of total subsidy under information asymmetry, while it is not always the best choice if the total subsidy level is uncertain. Under information asymmetry, the results show that manufacturer have no incentive to lie under any subsidy policy. However, the retailer has incentive to misrepresent individual information and its misreporting behaviour is related to the coefficient and allocation ratio of governmental subsidies. On this basis, we illustrate that a screening model can be deployed to reduce the negative effects of information asymmetry on supply chain operations. We therefore propose the method of improving the performance of low-carbon supply chains under various situations of information asymmetry and governmental subsidizing schemes to achieve system-wide Pareto improvement. [ABSTRACT FROM AUTHOR]

The increasing popularity of sharing platforms is raising concerns about a lack of information on the demand side: the cost of serving specific buyers is typically unknown to sellers. To mitigate this concern, some platforms, such as Airbnb, have adopted the bilateral review system (BRS), allowing buyers and sellers to rate each other. This differs from the traditional unilateral review system (URS), which allows only buyers to rate sellers. In this study, we examine how these two review systems impact the operation of a peer-to-peer (P2P) sharing platform, where sellers with different qualities are matched with buyers with different serving costs. Our analysis reveals that under URS, even with perfect seller information, high-quality sellers can still be driven out of the market due to unknown information about the buyer and the "coproduction" nature of the serving cost. This differs from the adverse selection problem often observed in the used car market, for example, where sellers of high-quality products withdraw due to generally unknown product quality. Additionally, we highlight the critical role of the expected buyer cost: When this cost is high, BRS can benefit the platform by alleviating the adverse selection problem; however, when this cost is low, BRS becomes detrimental to the platform. Our analysis also shows that BRS helps buyers but can hurt sellers. However, BRS has the potential to generate a favorable outcome for all parties involved, resulting in a win-win-win situation benefiting the platform, buyers, and sellers. Our results not only shed light on review system design but also provide a plausible explanation for the widespread use of BRS by sharing platforms such as Airbnb, Fiverr, and Turo. [ABSTRACT FROM AUTHOR]

Copyright of Contemporary Accounting Research is the property of Canadian Academic Accounting Association and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Contemporary Accounting Research is the property of Canadian Academic Accounting Association and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

We use the 2015 Chinese stock market crash to study the effects of government stock purchases. The Chinese government purchased stocks to stabilize the markets through state-owned financial institutions known as the "National Team." We find that the intervention led to reduced volatility and price informativeness. These impacts are driven by the disclosure of government portfolios. Consistent with investors having a stronger incentive to acquire government intervention information instead of fundamental news, we find reduced information production and information asymmetry following intervention disclosure. The article suggests that government stock purchases involve a trade-off between stability and informational efficiency. [ABSTRACT FROM AUTHOR]

This study investigates the relationship between corporate site visits (CSVs) and firms' real earnings management. Using a unique dataset of site visits to Chinese firms listed on the Shenzhen Stock Exchange from 2009 to 2016, we find that such visits are negatively associated with firms' real earnings management. The results are robust to using alternative CSV measures, controlling for alternative communication channels, and using the propensity score matching method. In cross-sectional analyses, we find that the negative association between site visits and real earnings management is stronger for more complex firms and firms with greater information asymmetry. In addition, we find that CSVs are negatively associated with both management and corporate misconduct but not with accrual-based earnings management or restatements. [ABSTRACT FROM AUTHOR]

This study provides new evidence on the influential role of external auditors in enhancing the informativeness of form 10-K annual reports to shareholders. Specifically, we find that the client's choice of a Big 4 auditor (PwC, EY, KPMG, and Deloitte) versus a non-Big 4 auditor contributes to cross-sectional variations in 10-K disclosure volume. We also document that the benefit of enhanced disclosures provided by Big 4 auditors is more pronounced for audit clients with poorer accrual quality and those with higher information asymmetry. Furthermore, we introduce the portion of 10-K length unexplained by operating complexity and observable client characteristics as a new proxy for audit firm effort. Specifically, we find that abnormally long disclosures are associated with higher audit fees and longer audit report lag, which implies that an incremental level of audit effort can be inferred from the discretionary component of 10-K disclosures. As audit effort is costly, a greater volume of 10-K disclosures can be expected to be associated with an improvement in the quality of financial reporting. Overall, our findings show that auditors play more than a simple attestation role in the financial reporting process, and that the quality of financial reporting in a company's 10-K annual report is a joint product of the effort and decisions of both a company's managers and its auditors. [ABSTRACT FROM AUTHOR]

Credit default swaps (CDSs) are a major financial innovation related to debt contracting. Because CDS markets facilitate bad news being incorporated into equity prices via cross-market information spillover, CDS availability may curb firms' information hoarding. We find that CDS trading on a firm's debt reduces the future stock price crash risk. This effect is stronger in active CDS markets, when the main lenders are CDS market dealers with securities trading subsidiaries, or when managers have more motivation to hoard information. Our findings suggest that debt market financial innovations curtail the negative equity market effects of firms withholding bad news. [ABSTRACT FROM AUTHOR]

We examine the effects of implementing a U.S. approach to the enforcement of mandatory disclosure in China. Using a hand-collected sample of comment letters (CLs) issued by the Shanghai Stock Exchange over the period of 2013 to 2018, we show that stock price reactions to CL receipts and replies are negative and significant. Using textual analysis to match issues raised by regulators to targeted firms' changes in disclosure, we show that these firms do address CL issues point by point, but do not experience significant improvements in their information environments. Our article highlights the importance of incentives rather than regulation/enforcement in reducing information asymmetry. [ABSTRACT FROM AUTHOR]

We test the signaling view of corporate social responsibility (CSR) engagement using two complementary quasi-natural experiments that impose exogenous negative pressure on stock prices. Firms under such adverse price pressure increase CSR activities compared to otherwise similar firms. This effect concentrates among firms with stronger signaling incentives, namely, those facing greater information asymmetry, more product market competition, higher shareholder litigation risk, and higher stock price crash risk. Firms under the exogenous negative price pressure mainly improve CSR strengths, including costly environmental investments. We also find that CSR engagement attracts socially responsible investors and lowers the cost of capital for signaling firms. [ABSTRACT FROM AUTHOR]

We study how derivatives (with nonlinear payoffs) affect the underlying asset's liquidity. In a rational expectations equilibrium, informed investors expect low conditional volatility and sell derivatives to the others. These derivative trades affect different investors' utility differently, possibly amplifying liquidity risk. As investors delta hedge their derivative positions, price impact in the underlying drops, suggesting improved liquidity, because informed trading is diluted. In contrast, effects on price reversal are ambiguous, depending on investors' relative delta hedging sensitivity (i.e., the gamma of the derivatives). The model cautions of potential disconnections between illiquidity measures and liquidity risk premium due to derivatives trading. [ABSTRACT FROM AUTHOR]

We document a new empirical phenomenon in which the aggregate positions of money managers, who are sophisticated speculators in the commodity futures market, as disclosed by the Disaggregated Commitments of Traders reports, can predict the cross section of commodity producers' stock returns in the subsequent week. We employ a number of cross-sectional methods, including calendar-time regression analysis, single-sort, double-sort, and Fama–MacBeth regressions, to confirm the predictability results. The results are more pronounced in firms with higher information asymmetry. We thus add more empirical evidence to the literature on costly information processing, which leads to gradual information diffusion across asset markets. [ABSTRACT FROM AUTHOR]

Copyright of Contemporary Accounting Research is the property of Canadian Academic Accounting Association and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Multi-access edge computing (MEC), as a computing model that provides services on the user side, can effectively solve the problems of high delay and resource shortage in traditional cloud computing when processing massive data. However, existing edge computing resources are still limited, and difficult to provide services to users in inaccessible remote areas. Considering that unmanned aerial vehicle (UAV) has the advantages of easy deployment, high flexibility and low cost, a UAV-assisted MEC hierarchical computation offloading framework is proposed. Firstly, contract theory is used to solve the information asymmetry problem between the platform and the UAV, and the UAV is encouraged to provide computing services. By analyzing the attributes and conditions of feasible contracts, the optimal contract is designed using the Lagrange multiplier method. Secondly, by constructing the preference set between UAV and mobile user (MU), a mobile user and unmanned aerial vehicle bilateral matching (MUBM) algorithm is proposed to establish the connection between user tasks and UAV computing resources. Finally, the feasibility and effectiveness of the contract were verified through experiments. The experimental results also prove the stability of the MUBM. [ABSTRACT FROM AUTHOR]

This study investigates the relationship between digital transformation (DT) and corporate innovation activities. By studying the publicly-listed firms in China, we find that firms with higher levels of DT tend to spend more on research and development (R&D) and tend to generate more innovation outputs. The impact of DT on R&D expenditures is particularly pronounced for firms with more limited disclosure of information, more complex organizational structures, and for those who do not receive government sponsorship. We find no evidence that DT affects innovation through alleviating financial constraints or enhancing operating performance. Collectively, these findings offer novel and practical insights into the interaction between digitization and firms' innovation. [ABSTRACT FROM AUTHOR]

We extend an investment model with demand uncertainty and asymmetric information on investment costs. The manager of firms has more investment costs information than the owner. Meanwhile, demand uncertainty that firms always face after investment. We develop a dynamic model that captures the joint effect of uncertainty and asymmetric information on investment timing and quantity. The results show that the risk effect dominates the uncertainty effect on the investment threshold and quantity. The uncertainty and degree of asymmetric information have opposite effects on investment. Moreover, the risk effect dominates the uncertainty effect, while the risk and the degree of asymmetric information are synergistic effects. [ABSTRACT FROM AUTHOR]

This study investigates whether and how the textual content of product descriptions, especially the sentiment element, influences buyers' purchase intentions. Using year-round digital transaction data from Mercari, a leading e-Commerce platform in Japan, we examine the interplay of hard and soft information signals exchanged between sellers and buyers. The study addresses two crucial questions: (1) Do the descriptions that sellers provide on product sales pages impact the buyer's intent to purchase? and (2) In what way does the description influence the buyer's purchase intention? Quantitative analysis is used to understand the relationship between product descriptions, sentiment elements, and purchase intentions. The results show that sentiment factors in product descriptions can serve as high-quality "signals" that can help buyers make informed purchasing decisions and reduce information asymmetry between buyers and sellers. This research contributes to understanding decision-making in online markets, particularly the role of soft information and sentiment analysis. [ABSTRACT FROM AUTHOR]

Online targeted advertising leverages an information asymmetry between the advertiser and the recipient. Policymakers in the European Union and the United States aim to decrease this asymmetry by requiring information transparency information alongside political advertisements, in the hope of activating citizens' persuasion knowledge. However, the proposed regulations all present different directions with regard to the required content of transparency information. Consequently, not all proposed interventions will be (equally) effective. Moreover, there is a chance that transparent information has additional consequences, such as increasing privacy concerns or decreasing advertising effectiveness. Using an online experiment (N = 1331), this study addresses these challenges and finds that two regulatory interventions (DSA and HAA) increase persuasion knowledge, while the chance of raising privacy concerns or lowering advertisement effectiveness is present but slim. Results suggest transparency information interventions have some promise, but at the same time underline the limitations of user-facing transparency interventions. [ABSTRACT FROM AUTHOR]

The digital technology has injected new vitality into the development of enterprises, which is conducive to promoting the development of enterprises to improve quality and efficiency. Based on measuring the comprehensive index of enterprise digitisation and enterprise vitality, this paper discusses the influence and mechanism of digital transformation on enterprise vitality. It is found that digital transformation has a positive promoting effect on enterprise vitality, and with the improvement of the level of development vitality, it shows a marginal increasing trend, but with the evolution of the enterprise life cycle, it shows a marginal decreasing trend. Mechanism analysis shows that digital transformation promotes the vitality of enterprises mainly by improving productivity, alleviating information asymmetry and improving resource allocation. With the improvement of regional market integration, institutional quality, scientific and educational resources and industrial upgrading, digital transformation plays a more important role in promoting the vitality of enterprises. There exists obvious industry concentration, executive background and property right nature heterogeneity. The conclusion of this paper provides a series of empirical evidence for enterprises to digitally release their vitality and promote the high-quality development of enterprises. [ABSTRACT FROM AUTHOR]

The opacity, autonomy and complexity of AI systems can stand in the way of a fair and efficient allocation of risk and loss. The European Commission (EC) has recognized this and has addressed these matters in two proposals for two directives: the AI Liability Directive and a new Product Liability Directive. Both Directives address information asymmetries between parties in a liability claim by providing new rules on the burden of proof. In addition, the proposed Product Liability Directive has been brought 'up-to-date' by explicitly incorporating new technical developments and by ending the debate on software as a product. Nevertheless, the injured party might still not receive compensation for the damage caused by a defective AI-system. This gives rise to the question of whether the legal framework for compensation should be revised more boldly to ensure compensation for the damage suffered by the injured party. This contribution will explore such a bold approach by delving into compensation funds. More specifically, this contribution will examine how a compensation fund for damage caused by AI-systems can be designed as well as what its boundaries could or should be and what its benefits could be. [ABSTRACT FROM AUTHOR]

This paper examines the relationship between environmental violations and stock price crash risk, using the sample of Chinese A-shared listed firms and a comprehensive range of Chinese listed heavily polluting companies covering 2012 to 2021. We provide strong and robust evidence that environmental violations significantly increase future stock price crash risk for Chinese listed heavily polluting companies. Through the mechanism of internal control, our paper finds that environmental violations lead to the weakening of internal control, thereby exacerbating future stock price crash risk. We further find that the legal environment has a negatively moderating impact on the relationship. Additionally, heterogeneity analysis shows that the influence of environmental violations on stock price crash risk is more prominent when firms are smaller, have non-state ownership, and have a lower level of corporate governance and external monitoring. [ABSTRACT FROM AUTHOR]

We examine whether the risk of losing proprietary information through the supply chain affects relationship‐specific investment (RSI) decisions by supply chain partners. Using state courts' staggered adoption of the Inevitable Disclosure Doctrine (IDD) as a shock to the firm's ability to protect proprietary information, we find that customers increase RSI when their supplier is headquartered in a state that adopts IDD. The effect is more substantial for customers who face a higher risk of losing proprietary information and with suppliers that are difficult to substitute. IDD also plays a more prominent role in the absence of alternate mechanisms that reduce contracting frictions, such as shared directors, common ownership, or joint ventures. Our results are robust to using cross‐citation measures of RSI and alternative estimations that mitigate potential biases arising from the staggered difference‐in‐difference approach. Our findings suggest that proprietary information protection enables firms to reduce contracting frictions arising in supply chain relations. [ABSTRACT FROM AUTHOR]

Based on the theory of social network, this paper studies the relationship between institutional investor clique and audit quality. Existing literature has found that institutional investors and audit quality are positively correlated. 1 Based on the data of Shanghai and Shenzhen A-share listed companies from 2010 to 2020, this paper examines the relationship between institutional investor clique and audit quality. The result shows that the higher the ratio of shares held by institutional investor clique, the higher the audit quality. The influence mechanism shows that institutional investor clique can affect audit quality by alleviating information asymmetry. The mechanism provides new empirical evidence for the governance effect of institutional investor clique and contributes to understand the governance effect of institutional investor clique. [ABSTRACT FROM AUTHOR]

This paper constructs an institutional investor network based on the heavy holdings of the same stock in China and conducts a social network analysis to investigate the influence of this network on stock price volatility from the perspectives of network structure (density) and location (centrality). The study demonstrates that institutional investor network density is negatively related to stock price volatility, while network centrality is positively related to it. Mechanism analyses further reveal that network density reduces stock price volatility by mitigating private information arbitrage behavior among institutional investors, whereas network centrality increases stock price volatility by creating private information arbitrage opportunities within the network. Additionally, the paper finds that information asymmetry enhances the positive effect of network centrality on stock price volatility. These findings are generally consistent across subsample analyses for different market states, reactions to good and bad news, and types of equity ownership, as well as in other robustness tests. The practical implications of these findings are significant for market stability regulation. [ABSTRACT FROM AUTHOR]

Although the decentralization and traceability features of blockchain technology are crucial for fostering closed‐loop production, there are numerous obstacles and insufficient incentives for its implementation. This paper constructs the analysis framework of blockchain adoption and application in closed‐loop production, including four parts: blockchain adoption incentive contract, condition analysis of blockchain application, revenue analysis of blockchain application, and information screening analysis of blockchain application. It is found that the adoption incentive contract is an important driving force to promote manufacturer to apply blockchain technology, and the manufacturer needs to pay information rent to the consumer under information asymmetry. The manufacturer can obtain consumer traceability preference and realize information screening between the manufacturer and consumer. Consumer traceability preference for new products can better promote traceable information technology level and closed‐loop revenue. This research is of great significance in promoting sustainable closed‐loop production. [ABSTRACT FROM AUTHOR]

The objective of this study is to investigate the impact of short-selling mechanisms on management net tone. By utilising data from A-share listed companies on the Shanghai and Shenzhen stock exchanges between 2007 and 2017, the analysis employs a difference-in-differences model which reveals that short-selling mechanisms significantly reduce management net tone. The conclusions drawn from this study remain robust after a series of stringent tests. Further analysis reveals that in non-state-owned enterprises, firms with lower information transparency, and those operating within superior market and legal environments, short-selling mechanisms effectively suppress management tone inflation. Additionally, the study identifies analyst coverage and executive compensation as mediating channels through which short-selling mechanisms influence management net tone. This research provides valuable theoretical insights for regulatory bodies concerning the disclosure of non-financial information by listed companies. [ABSTRACT FROM AUTHOR]

Carbon disclosures are essential for investors to evaluate firms’ efforts to combat climate change. In this study, we focus on a specific type of carbon disclosures—namely, emission allowance disclosures—that capture how firms implement emission reductions under the European Union emission trading system (EU ETS). Given the continuously changing institutional features of the EU ETS and the lack of authoritative guidance on how firms should account for emission allowances in their financial statements, it is exceedingly difficult for investors to understand numerical emission allowance disclosures and to compare them across—and even within—firms. Motivated by this criticism, we hypothesize and find that textual disclosures complementing numerical emission allowance disclosures are associated with lower information asymmetries between firms and their investors. Further analyses show that textual disclosures that: (i) describe the accounting approach, and (ii) contain institutional information on the EU ETS, respectively, are particularly important for improving the information environment of numerical emission allowance disclosures. Overall, our findings suggest that text can improve the understanding of numbers in a carbon disclosure context. Therefore, our study not only contributes to the (industrial ecology) literature but also has important implications for regulators, policymakers, investors, financial analysts, and firms. [ABSTRACT FROM AUTHOR]

Janus metasurfaces, exemplifying two‐faced 2D metamaterials, have shown unprecedented capabilities in asymmetrically manipulating the wavefront of electromagnetic waves in both forward and backward propagating directions, enabling novel applications in asymmetric information processing, security, and signal multiplexing. However, current Janus metasurfaces only allow for directional phase manipulation, hindering their broader application potential. Here, the study proposes a versatile Janus metasurface platform that can directionally control the phase and polarization of terahertz waves by integrating functionalities of half‐wave plates, quarter‐wave plates, and metallic gratings within a cascaded metasurface structure. As a proof‐of‐principle, the study experimentally demonstrates Janus metasurfaces capable of independent and simultaneous control over phase and polarization, showcasing propagation direction‐encoded focusing and polarization conversion. Moreover, the directionally focused points are utilized with distinct polarization states for advanced applications in direction‐ and polarization‐sensitive detection and imaging. This unique strategy for simultaneous phase and polarization control with direction‐dependent versatility opens new avenues for designing ultra‐compact devices with significant implications in imaging, encryption, and data storage. [ABSTRACT FROM AUTHOR]

China is currently undergoing a phase of high-quality development, with increasing emphasis on the circular economy, energy conservation, and environmental protection by both the government and enterprises. This paper examines a secondary supply chain comprising manufacturers and retailers, focusing on three supply chain decision-making models: one where the manufacturer is the channel leader, one where the retailer is the channel leader, and one where both parties have equal power. The study investigates the impact of manufacturers misrepresenting their Corporate Social Responsibility (CSR) information and the challenges associated with recycling efforts on the optimal performance of the supply chain. The findings reveal that when manufacturers lead the supply chain, they do not misrepresent their private information. However, when retailers dominate, manufacturers tend to underreport their CSR levels and the difficulty of recycling efforts. In scenarios where manufacturers and retailers have equal power, manufacturers do not misreport the difficulty of recycling but do underreport their CSR levels. This misreporting benefits the manufacturers at the expense of retailers and overall supply chain profitability, while also discouraging the recycling of used products. Across all three power structures, the study shows that retailers' marketing efforts decrease as the misrepresentation of recycling difficulty increases, and increase as the misrepresentation of CSR levels increases. To mitigate the effects of manufacturers' misreporting under information asymmetry, the paper proposes revenue-sharing contracts and two-part pricing contracts to coordinate the closed-loop supply chain under different power structures. Both contracts are shown to achieve Pareto improvements within the supply chain. This research provides valuable insights for enterprises operating within closed-loop supply chains, highlighting the importance of enhancing communication and cooperation to bridge information gaps and ensuring the coordina. [ABSTRACT FROM AUTHOR]

This article investigates the effect of international oil price uncertainty on investment efficiency using quarterly data of Chinese A-share listed companies from 2011 to 2020. It is discovered that uncertainty about oil prices increases principal-agent conflicts and information asymmetry in enterprises, leads to more inefficient investment, and ultimately lowers firms' investment efficiency. Furthermore, China's unique property rights foundation, firm size, and life cycle limit the aforementioned consequences. Additional investigation reveals that by raising companies' cash reserves, oil price uncertainty exacerbates overinvestment behavior. The study presented in this article can serve as a guide for businesses looking to make the best decisions in the context of volatile global oil prices and support their long-term, stable development. [ABSTRACT FROM AUTHOR]

Imperfect information is a major obstacle for agricultural businesses in developing countries. The resulting information asymmetry increases transaction costs and affects the behavior of market stakeholders. In Benin, market gardeners' participation is limited by geographical isolation and poor communication and transport infrastructures. Information and communication technologies (ICTs) now offer a fast and less costly means of accessing and disseminating information for more active market participation. The aim of this article is to measure the contribution of ICTs to market participation by testing whether they improve participation. Using a recursive bivariate probit model, our results indicate that market gardeners who use ICT to access information have a higher frequency of market participation than those who do not. Cell phones, radios, and televisions lead to a 35.3%, 25.6% and 8% higher probability of market participation respectively than those who don't use them. These results suggest that a platform for disseminating knowledge via ICT could be set up to increase market participation. [ABSTRACT FROM AUTHOR]

Serious information asymmetry exists between consumers and expert sellers in the credit-goods market. This study develops a generic model to investigate the relationship between consumer information and expert fraud in the credence goods market. The unique features of the model are that (i) the state of the consumer is multidimensional, (ii) the expert seller has concerns about their reputation, and (iii) information asymmetry exists between the consumer and the expert seller regarding the necessity of the provided treatment ex-ante and ex-post. On average, the equilibrium amount of the recommended treatment is greater than the necessary level. The contingent effect of any consumer information on expert overtreatment can be evaluated by analyzing the posterior variance of the number of problems updated by the information. Consumer information on only part of the problem hardly reduces expert overtreatment in certain situations. The unconditional effect of consumer information on expert seller fraud varies considerably with state distribution. • Overtreatment by reputation-concerned experts in credence goods market is studied. • Expert overtreatment is expressed by the variance in the number of consumer problems. • If consumer information lowers the posterior variance, it reduces overtreatment. • Consumer belief affects expert overtreatment. • How partial consumer information affects expected treatment provision is discussed. [ABSTRACT FROM AUTHOR]

This study explores the influence of risk disclosure levels and types on the readability of annual reports of non-financial firms in the UK during the COVID-19 outbreak. It further investigates how the disclosure of COVID-19-related information moderates the relationship between risk disclosure and readability. The study uses a content analysis approach and CFIE software to measure the level of risk disclosure and readability in the annual reports of non-financial firms listed on the FTSE all-share from 2019 to 2021. The results show a positive and significant effect of risk disclosure level on readability, which is stronger for firms that disclosed COVID-19 information. Different types of risk disclosure have varying effects on readability, with COVID-19 risk, credit risk, and strategic risk positively affecting readability, while operational risk negatively affects it. The study contributes to the literature on information asymmetry and institutional theory by demonstrating how risk disclosure and readability are influenced by external factors like the COVID-19 outbreak and internal factors such as firm characteristics and types of risks. It introduces a new risk definition and category specific to the COVID-19 pandemic and develops new measurements for risk disclosure, including credit, liquidity, market, operational, business, strategic, and COVID-19 risks. The study provides valuable insights for managers, investors, regulators, and standard setters on the relationship between risk disclosure and readability in annual reports. It highlights the importance of disclosing COVID-19-related information to enhance the readability and understandability of financial communication. The paper contributes to the literature and practice on risk disclosure, readability, and financial communication during crises. [ABSTRACT FROM AUTHOR]

In majoritarian legislatures, minority parties cannot directly influence policymaking. However, they may serve as whistleblowers against the majority parties' harmful policymaking. This study aims to explore whether a minority party's monitoring mitigates a political agency problem in a majoritarian legislature. For this purpose, we construct a two-period election model in which voters face information asymmetries regarding each party's type and the state of the world. After the majority party proposes a bill, the minority party votes for or against the proposed bill, which is a cheap-talk message. We show that the role of monitoring by the minority party is limited, even if we allow the possibility that the party is the truth-telling type. Under a weak condition, its opposition is informative, but does not change the electorate's voting behaviors. Consequently, any equilibrium outcomes attained in the game with monitoring are attainable in the game without monitoring. This implies that monitoring by the minority party does not influence electoral accountability. This irrelevance of monitoring is resolved when the minority party can delay legislation through obstruction. [ABSTRACT FROM AUTHOR]

To address information asymmetry in supply chains, the literature suggests that manufacturers should shift from market governance to hierarchical governance or a combination of both. However, as many manufacturers must continue to rely on market governance, this research introduces a governance strategy, manufacturer–retailer bridge governance (MRBG), for these manufacturers. The research examines the governance effects of MRBG on distributor behavior and the contingent effects of manufacturer status and MRBG strategic orientation. Hypotheses are developed based on in‐depth interviews with sales and purchasing managers and tested in two experiments with sales managers. The results show that MRBG has a double‐edged effect on distributor behavior, and this effect is moderated by manufacturer status. Moreover, the alignment between manufacturer status (high versus low) and MRBG strategic orientation (collaboration versus arbitrage) influences the effectiveness of MRBG. [ABSTRACT FROM AUTHOR]

This paper disentangles the impacts of cultural proximity on cross‐border banking flows, using large country‐pair data from 1996 to 2019. On applying the gravity model with the Poisson Pseudo Maximum Likelihood estimator, our main findings show that cultural proximity is both a push and pull factor, which robustly anticipates increased outflows (cross‐border lending) and inflows (cross‐border borrowing). The impacts of cultural proximity are transmitted throughout the information asymmetry and cost reduction channels. These impacts become pronounced for geographically proximate country pairs and hold for a different measure of cultural goods taxonomy and for controlling the endogeneity problem. [ABSTRACT FROM AUTHOR]

The strategy evolution process of game players is highly uncertain due to random emergent situations and other external disturbances. This paper investigates the issue of strategy interaction and behavioral decision-making among game players in simulated confrontation scenarios within a random interference environment. It considers the possible risks that random disturbances may pose to the autonomous decision-making of game players, as well as the impact of participants’ manipulative behaviors on the state changes of the players. A nonlinear mathematical model is established to describe the strategy decision-making process of the participants in this scenario. Subsequently, the strategy selection interaction relationship, strategy evolution stability, and dynamic decision-making process of the game players are investigated and verified by simulation experiments. The results show that maneuver-related parameters and random environmental interference factors have different effects on the selection and evolutionary speed of the agent’s strategies. Especially in a highly uncertain environment, even small information asymmetry or miscalculation may have a significant impact on decision-making. This also confirms the feasibility and effectiveness of the method proposed in the paper, which can better explain the behavioral decision-making process of the agent in the interaction process. This study provides feasibility analysis ideas and theoretical references for improving multi-agent interactive decision-making and the interpretability of the game system model. [ABSTRACT FROM AUTHOR]

As a key tool in implementing monetary policy and government financing, government bonds play an essential role in financial markets. By means of Islamic financial innovations in the Islamic capital market, the instrument of Islamic treasury bill is published and tradable in the over-the-counter market. Islamic treasury bills have many risks in terms of execution, including the ease of trading and liquidity in the secondary market. Therefore, this research aims to examine some microstructural elements of government bonds using a vector autoregressive model. In this article, the effect of trading volume on bid-ask spread of orders has been investigated. To survey the impact of these variables, the vector autoregressive (VAR) model has been used on intraday data of 17 symbols of Islamic treasury bills in the over-the-counter market, which had the most trading days from 2021 to September 2023. According to the studies, there is a significant relationship between the trading volume and bid-ask spread only in Islamic treasury bills with long-term maturity. Therefore, the effect of the bid-ask spread of orders in different periods is greater than the trading volume, especially in longer-term Islamic treasury bills. Hence, in this research, by analyzing the impulse response function, if there is a shock on the variables, the effect of the trading volume's shock remains for several periods and affects unremarkably the bid-ask spread of orders in most of the short-term and long-term Islamic treasury bills, while effects of the bid-ask spread shocks during initial periods for long-term and short-term Islamic treasury bills is excellent, but decrease sharply during the following periods. These results help traders pay attention and reduce the risk of trading in the over-the-counter market, specifically the long-term treasury bills. [ABSTRACT FROM AUTHOR]

This paper considers peer monitoring in a capital budgeting setting with information asymmetry between principal and agents. The paper demonstrates in a two‐agent, two‐project setting that the principal can have each agent reveal their private information on the other agent's project, at an arbitrarily low cost. Next, an examination of monitoring resource allocations is made. Specifically, a comparison is made of broad monitoring, which spreads monitoring resources equally across agents' projects, and focused monitoring, which applies all monitoring resources to a single agent's project. Focused monitoring is preferred within an intermediate range of profitability, above which broad monitoring is preferred and below which neither is preferred. If project profitability is heterogeneous and focused monitoring is preferred, the more profitable project receives the focus. Both of these results occur because there is a threshold of monitoring resources that must be deployed for monitoring to provide any benefit, and the threshold is higher (more resources must be deployed) for lower profitability projects. That is, even if all monitoring resources are devoted to a low profitability project, they may provide no benefit to the principal. A discussion of how peer monitoring can be engineered by the firm is included. [ABSTRACT FROM AUTHOR]

In an R&D cooperation with an innovation institution, the firm needs to design an efficient cooperation contract to enhance the cooperation efficiency under asymmetric information. Many governments encourage innovation through selective subsidies, whose review and supervision do disclose more information. However, the existing studies have ignored these impacts on designing R&D cooperation contracts. Thus, this paper constructs game models of R&D cooperation to obtain the optimal contract terms under different subsidy strategies and then further discusses the impacts of selective subsidy on R&D contract design. [ABSTRACT FROM AUTHOR]

This article proposes a 2‐period model featuring jointly habit formation, consumption externalities and asymmetric information to investigate their impacts on optimal labour and saving taxes. Regarding the effect of habit formation only, our model suggests that both labour taxation in the first period and a capital subsidy between the first and second period are used to deter consumption in the first period. However, when the impact of consumption externalities alone is considered, consumption externalities advocate for higher labour taxation for all agents. Finally, our quantitative results show that with the rising degree of consumption externalities, the discrepancy between marginal capital tax rates under full information and their values under asymmetric information falls, so does the change in the gap between the marginal labour income tax rates of the skilled and the unskilled. Conversely, as the degree of habit formation increases, the change in marginal capital tax rates under full information and under asymmetric information expands, so does the change in the gap between the marginal labour income tax rates of the skilled and the unskilled. [ABSTRACT FROM AUTHOR]

Extant research in entrepreneurship reveals that financial resource acquisition for student entrepreneurs is constrained by several factors including a lack of experience, domain expertise and underdeveloped social networks. What follows are accentuated risks of failure that can discourage students from entering the entrepreneurial career pathway. To attenuate resource shortcomings and information asymmetries, student entrepreneurs can signal their underlying qualities to other entrepreneurial actors through informational cues. These signals are embedded in the norms and rules of a specific context; however, much of the research related to signals has been devoid of contextual understanding. Building on the notion that signals do not operate in a vacuum, our attention in the present work is directed from an entrepreneurial ecosystem perspective and the impact this specific context can have on signal generation and interpretation. We build our contribution by extending signaling theory via a multiple case study of eight student entrepreneurs operating in an emerging privately governed entrepreneurial ecosystem located in Valencia, Spain. We contextualize four pathways that students followed towards entrepreneurial financing, creating four student entrepreneur profiles. Several useful contributions to the study of student entrepreneurship, signaling theory, and entrepreneurial ecosystem theory are made. [ABSTRACT FROM AUTHOR]

Purpose: This study aims to assess if the voluntary reporting of adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), a widely used non-generally accepted accounting principles (GAAP) measure, has effects on information asymmetry and value relevance and how the adjustments to GAAP earnings made to derive it contribute to these effects. This study focuses on firms from two countries with contrasting institutional settings, Canada and France. Design/methodology/approach: Relying on multivariate analyses and using Heckman's procedure to address the sample self-selection issue, this study first estimates the likelihood of a firm to report adjusted EBITDA. Then, this study examines if adjusted EBITDA, as well as the adjustments made to GAAP earnings to derive adjusted EBITDA (adjustments), affect a firm's information asymmetry and its value. These adjustments are essentially GAAP-grounded items that are discarded by management to derive non-GAAP adjusted EBITDA. The dependent variables are share price volatility, as a proxy for information asymmetry, alongside market-to-book and stock market return as indicators of value. Findings: In terms of the used sample, results suggest that Canadian firms are much more likely to report adjusted EBITDA than French firms. Chief executive officer (CEO) attributes (CEO power) appears to increase such likelihood. Moreover, for both Canadian and French firms, adjusted EBITDA is associated with reduced stock market volatility, an indication of lower information asymmetry, as well as higher market-to-book and returns, suggesting value relevance. The results also indicate that investors view the adjustments to GAAP earnings made by management to derive adjusted EBITDA as not value relevant (similar to noise). The GAAP-grounded elements that management discard to derive adjusted EBITDA actually increase information asymmetry. Originality/value: This study adds to prior research on the interface between a CEO attributes and governance and non-GAAP reporting. This study also provides evidence that, despite very different institutional settings, non-GAAP reporting conveys relevant information to capital markets' participants in both France and Canada. Hence, a country's institutional setting may have a differential impact on the disclosure choice but not on the resulting value relevance of such disclosure. Finally, this study extends the non-GAAP literature by examining the value relevance of a widely used yet under-researched measure, adjusted EBITDA. [ABSTRACT FROM AUTHOR]

Purpose: This study aims to examine the impact of the International Financial Reporting Standards (IFRS) mandate and differences in national institutional quality on the underpricing of Initial Public Offering (IPO) companies. Design/methodology/approach: Multiple Difference-in-Differences (DiD) ordinary least squares estimations were conducted for 100 corporations listed on the Saudi Arabian stock market using country-level institutional quality data from 2005 to 2017. Findings: IFRS requirements and improvements in institutional quality have a combined effect on minimizing IPO underpricing. The analysis of the combined impact of IFRS requirements and differences in transparency revealed that IPO vendors leave $5 on average for IPO investors to cash out post the IFRS mandate, compared to $29 previously. Thus, IFRS serves as a quality certification instrument that alleviates IPO investors' ex ante uncertainties, even in nations with undeveloped institutions. Practical implications: The findings may be beneficial to researchers and policymakers. The results suggest that institutional quality enhancements and obligatory IFRS implementation highlight IFRS's synergistic influence on the IPO market. While European harmonization efforts drove the adoption of IFRS in Europe in 2005, Saudi Arabia's adoption of IFRS is not being driven by such initiatives (Daske et al., 2008; Persakis and Iatridis 2017). In reality, when IFRS was officially imposed in Saudi Arabia in 2008, it, like many other emerging market nations, made considerable reforms to its formal institutions. However, research on the combined impact of IFRS and disparities in institutional quality in emerging IPO markets remains sparse. Emerging markets represent more than half of economies that use IFRS. Therefore, to the best of the authors' knowledge, this study is the first to conduct an empirical investigation to identify this combined effect in emerging countries using the DiD analytical technique. Equity market legislators remain concerned regarding IPO underpricing, as it has a detrimental influence on economic growth (Bova and Pereira, 2012; Jamaani and Ahmed, 2021; Mehmood et al., 2021). Depending on the degree of information asymmetry in national stock markets, underpricing costs increase the cost of going public for entrepreneurs. Consequently, prospective private firms are discouraged from accessing equity financing through the stock markets. This is likely to impede private sector development plans, causing a negative effect on economic growth. Originality/value: Emerging countries represent over 50% of the IFRS mandating economies. However, there is insufficient research on the combined effect of IFRS requirements and improvements in institutional quality in developing IPO markets. To the best of the authors' knowledge, this study is the first empirical attempt to identify this combined effect in one of the largest developing countries. The results may aid academics and policymakers in better understanding the interaction between these two variables. [ABSTRACT FROM AUTHOR]