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The article discusses the concerns related to the right to leave the Eurozone which was established for providing emergency loans to member states of European Union. It informs that France and Greece wants to leave Eurozone due to facing national insolvency situations and not to fulfill the requirement. It presents information on legal options for leaving the Eurozone which includes provisions of agency costs, externalities, and borrowing costs.

This paper presents the development and implementation of a Multi-Objective Decision-Aid Tool (MODAT) tested with data from the Estradas de Portugal's Pavement Management System. The MODAT uses a multi-objective deterministic section-linked optimisation model with different possible goals: minimisation of agency costs, minimisation of user costs, maximisation of the residual value of pavements, etc. The MODAT also uses the deterministic pavement performance model used in the AASHTO flexible pavement design method. The application of the new Decision-Aid Tool is illustrated with a case study involving the main road network of Castelo Branco, a district of Portugal. In this application, the Knee point, that represents the most interesting solution of the Pareto frontier, corresponds to an agency costs weight value of 4% and an user costs weight value of 96%, demonstrating that user costs, which are generally much higher than agency costs, dominate the decision process. [ABSTRACT FROM PUBLISHER]

Abstract: This paper studies optimal real estate organizational forms as a means of enhancing real estate values in the ongoing subprime crisis. We model the organizational response to stakeholder conflicts and regulatory changes to show how they evolve to an optimal form and undertake an optimal capital structure to enhance the welfare of investors. Using the examples of the REIT and RELP organizational forms, we show how the rivalry between taxable and institutional investors shapes the UPREIT form. We employ a two-period partial equilibrium model to demonstrate that UPREITs adapt to regulatory changes by (i) meticulously acquiring a hybrid form that contains the desirable features of both REITs and RELPs, and (ii) efficiently trading off debt claims between their constituent investor bases. This adaptation enhances welfare by mitigating administrative costs, agency costs, bankruptcy costs, illiquidity costs and taxes. [Copyright &y& Elsevier]

Introduction of perpetual pavement in the late 1990s provided the possibility of constructing a pavement with higher initial investment expenditure but lower maintenance and user costs. Life cycle cost (LCC) of a facility is the sum of all one-time and recurring costs over the full life span of that facility. As for highways, it includes agency costs (initial construction and maintenance costs), user costs (vehicle operation and time value costs), social costs (environmental costs) and salvage value at the end of pavement design life which is considered as a negative cost. This study compares the LCC of highways with conventional and perpetual pavements to figure out which system is economically preferred in various traffic and weather conditions for Iranian highways. Results of the study show that perpetual pavement construction can save LCC of pavements in the range of 4–20%. [ABSTRACT FROM AUTHOR]

This article examines the regulation of directors' remuneration in EU, UK and Belgian law. The author argues that there are two categorises of norms for the regulatory framework of directors' remuneration: one is market-based, market efficiency norms of agency costs; the other is socio-legal norms. The paper argues that agency costs – a responsive mode of governance – alone cannot adequately address the problems of directors' remuneration. On the other hand, socio-legal norms – which are value and ethics-focused – can better construct a paradigm capable of addressing a broader issue of directors' remuneration in the EU context. Agency costs-based regulation has been used by the EU whereas socio-legal matters have been left to Member States. The article shows how socio-legal norms could form the underlying basis of the regulatory regime by examining the laws in the UK and Belgium. It is concluded that the European Court of Justice will need to carry out the role of negative integration by harmonising these social values in developing EU company law. [ABSTRACT FROM PUBLISHER]

The private legal-practice market has a heavy proportion of solo practitioners compared to multimember law firms. A partial explanation is found with Coase's theory of the firm, Alchian and Demsetz's explanations of the internal mechanisms of the firm, and Demsetz 's later work on agency costs. But there are also many "push-factors" that figure into a solo's decision. It is this article's contention that prior economic theory is incomplete as it neglects to evaluate legal market realities and the nature of the law firm itself. An evaluation of these "push-pull" factors will explore why a simple question has a complex answer. [ABSTRACT FROM AUTHOR]

The article discusses the role of plaintiffs' class action attorneys in America as of September 2012, focusing on an analysis of the monetary and self-interest motivations of attorneys who represent plaintiffs in class action lawsuits. Agency cost theory is addressed in relation to the inability or unwillingness of class members to monitor the activities of their attorneys. Incentives for attorneys are also examined in relation to the size of law firms.

Agricultural cooperatives are often assumed to be less competitive compared to investor-owned firms due to its higher decision-making costs. We have empirically investigated how cooperatives can minimize both democratic and agency costs given differing levels of member participation. We distinguish between horizontal, vertical, and diagonal conflicts of interests, as well as between both direct and opportunity costs. We found that direct agency cost is a smaller concern for cooperatives compared to the risk of exposure to high opportunity agency costs. We also found that the relation between member participation in the board of directors and democratic costs is more complex than often assumed. Finally, we show the difficulties cooperatives face in minimizing both democratic and agency costs. With a lower level of member participation, direct democratic costs may be reduced, but opportunity agency costs may rise as fewer members monitor management. Therefore, cooperatives should either increase member participation or use additional agency mechanisms (such as audits) to prevent agency problems. [ABSTRACT FROM AUTHOR]

Abstract: This study focuses on firms that are audited by a big auditor and examines the differentiation in the earnings management potential and the level of conservatism. It also investigates whether being audited by a big auditor would lead to lower agency costs and lower cost of equity. The study focuses on emerging common-law South Africa and code-law Brazil, and seeks to identify whether there are material differences given their dissimilar institutional characteristics. The study reports that even though firms may be audited by high quality auditors, their institutional differences influence significantly firms'' earnings conservatism, agency costs and cost of equity. Client firms of big auditors in both common-law South Africa and code-law Brazil exhibit lower discretionary accruals. The study has found evidence of more conservative earnings for South Africa but insufficient levels for Brazil. For common-law South Africa, the presence of effective corporate governance mechanisms reduces agency costs. For code-law Brazil, the corporate governance mechanisms generally display an insignificant impact on reducing agency costs. For common-law South Africa, firm-level performance, growth and market determinants tend to lead to a lower cost of equity. For code-law Brazil, it is found that significant discretionary accruals, market beta and analyst forecast dispersion would result in higher uncertainty and would consequently raise the cost of equity. [Copyright &y& Elsevier]

Organizações cooperativas têm um sistema único de distribuição de direitos de propriedade e decisão que envolvem problemas de gerenciamento e custos de transação. Tal estrutura cria direitos de propriedade e transferências de risco que afetam diretamente a eficiência do gerenciamento autônomo destas organizações. Este documento analisa os custos e as fontes de ineficiência para explicar seus problemas de dois modos diferentes e complementares. Primeiramente discute os principais aspectos da governança que geram conflitos de agência; em segundo lugar analisa as características dos sistemas de gerenciamento que geram assimetria informativa e problemas de monitoração. Uma análise a respeito da distribuição de direitos de propriedade entre membros e da distribuição de direitos de decisão entre membros eleitos e executivos profissionais contratados indica que os direitos sobre resultados e o compartilhamento de risco nas relações contratuais da cooperativa conduzem a uma tipologia do tipo de governança, do modelo de gerenciamento e das características do sistema de informações gerenciais que possam reduzir os problemas da agência. A metodologia utilizada foi a discussão teórica e comparação dos modelos e sistemas gerenciais de cooperativas agrícolas e de crédito rural no Brasil. Um questionário foi aplicado em cinco cooperativas para comparar modelos e sistemas gerenciais. Nossas considerações finais mostram que a melhor organização do modelo de gerenciamento da cooperativa, assim como sistemas gerenciais, poderiam reduzir seus custos de agência. [ABSTRACT FROM AUTHOR]

Abstract: This paper presents and tests a method to design high-performance transit networks. The method produces conceptual plans for geometric idealizations of a particular city that are later adapted to the real conditions. These conceptual plans are generalizations of the hybrid network concept proposed in . The best plan for a specific application is chosen via optimization. The objective function is composed of analytic formulae for a concept’s agency cost and user level of service. These formulae include as parameters key demand-side attributes of the city, assumed to be rectangular, and supply-side attributes of the transit technology. They also include as decision variables the system’s line and stop spacings, the degree to which it focuses passenger trips on the city center, and the service headway. These decision variables are sufficient to define an idealized geometric layout of the system and an operating plan. This layout-operating plan is then used as a design target when developing the real, detailed master plan. Ultimately, the latter is simulated to obtain more accurate cost and level of service estimates. This process has been applied to design a high performance bus (HPB) network for Barcelona (Spain). The idealized solution for Barcelona includes 182km of one-way infrastructure, uses 250 vehicles and costs 42,489€/h to build and run. These figures only amount to about one third of the agency resources and cost currently used to provide bus service. A detailed design that resembles this target and conforms to the peculiarities of the city is also presented and simulated. The agency cost and user level of service metrics of the simulated system differ from those of the idealized model by less than 10%. Although the designed and simulated HPB systems provide sub-optimal spatial coverage because Barcelona lacks suitable streets, the level of service is good. Simulations suggest that if the proposed system was implemented side-by-side with the current one, it would capture most of the demand. [Copyright &y& Elsevier]

Many scholars have found a negative relationship between a firm's size and its value, as measured by Tobin's q. This result is called the size discount. There are hypotheses about why the size discount exists, but none have been rigorously empirically tested. This paper argues that the size discount is created by the inability of shareholders to minimize agency costs in larger companies. Statistical tests suggest that the size discount only appears in large firms with managers that impose excessive agency costs upon their shareholders. Empiricists who use Tobin's q to proxy for growth opportunities may need a different proxy. [ABSTRACT FROM AUTHOR]

The article discusses the alternative model called a common agency theory for public corporations in California. This agency is created when multiple principals influence a single agent describing a shareholder/management relationship with competing preferences on corporate management. Also explained is the investor activities and arguments that increasing shareholder power lead to the decrease of agency costs caused by management expropriation.

Abstract: This paper describes the network shapes and operating characteristics that allow a transit system to deliver an accessibility level competitive with that of the automobile. To provide exhaustive results for service regions of different sizes and demographics, the paper idealizes these regions as squares with uniform demand, and their possible networks as a broad and realistic family that combines the grid and the hub-and-spoke concepts. The paper also shows how to use these results to generate master plans of transit systems for real cities. The analysis reveals which network structure and technology (Bus, Bus Rapid Transit, or Metro) delivers the desired performance with the least cost. It is found that the more expensive the system’s infrastructure, the more it should tilt toward the hub-and-spoke concept. Bus Rapid Transit (BRT) competes effectively with the automobile unless a city is big and its demand low. This happens despite the uniform demand assumption, which penalizes collective transport. It is also found that if a city has enough suitable streets on which to run Bus and BRT systems, these outperform Metro even if the city is large and the demand high. Agency costs are always small compared with user costs; and both decline with the demand density. In all cases, increasing the spatial concentration of stops beyond a critical level increases both, the user and agency costs. Too much spatial coverage is counterproductive. [Copyright &y& Elsevier]

This article investigates the impact on share prices when news released on the specialized media indicates that the interests of controlling and minority shareholders groups diverge. Methodologically, we analyze 24 announcements of conflicts between shareholder groups in Brazil using two event study methodologies. We find strong support for our hypothesis that such news constitutes a proxy for relevant agency costs taking place, leading to a higher perception of risk and reduced share price. To our knowledge, this is the first article to estimate the impact of specific agency costs between controlling and minority shareholders in an environment characterized by concentrated ownership structures. The article is relevant for all capital markets' investors, as well as for analysts and other capital markets' agents. For policy makers and practitioners, our results provide evidence on the potential corporate value loss owing to conflicts between shareholders groups. As a result, they reinforce the argument for the adoption of good corporate governance practices, in order to avoid corporate value destruction resulting from problems between different shareholding groups. The main author is a professor at the School of Economics, Management and Accounting of University of São Paulo (FEA/USP) in Corporate Governance courses at both graduate and undergraduate level. In addition, he is Executive Coordinator of the Center for Corporate Governance Research of Fipecafi (CEG – www.ceg.org.br), Vice-President of the Brazilian Society of Finance (www.sbfin.org.br) and Senior Researcher of the Brazilian Institute of Corporate Governance (IBGC – www.ibgc.org.br). He is author of several books and articles on corporate governance, and writes a monthly column on corporate governance issues for Capital Aberto magazine, one of the most prominent capital markets' magazines in Brazil, making him well known among the corporate governance community in Brazil and Latin America. All persons involved with capital markets, media and policy makers should take note of these results, as most have corporate environments characterized by controlling shareholders, and their relationship with minority shareholders can be a potential source of relevant value destruction. [ABSTRACT FROM AUTHOR]

Abstract: The Orphan Drug Act (ODA) was designed to spur the development of drugs for rare diseases. In principle, its design also incentivizes pharmaceutical firms to develop drugs for “rare” subdivisions of more prevalent diseases. I find that in response to this incentive, firms develop drugs for ODA-qualifying subdivisions of non-rare diseases. The impact in these tailored drug markets represents half of the total R&D response to the ODA. I also find that 10-percent of the innovation in subdivided disease drugs induced by the ODA would have been conducted without the policy. While modest in size, this inefficiency suggests that agency problems should be considered when designing innovation policy. [Copyright &y& Elsevier]

Moral codes are produced and enforced by more or less specialized means and are subject to standard economic forces. This article argues that the intermediary role played by the Catholic Church between God and Christians, a key difference from Protestantism, faces the standard tradeoff of specialization benefits and agency costs. It applies this trade-off hypothesis to confession of sins to priests, an institution that epitomizes such intermediation, showing that this hypothesis fits cognitive, historical, and econometric evidence better than a simpler rent-seeking story. In particular, Catholics who confess more often are observed to comply more with the moral code; however, no relationship is observed between mass attendance and moral compliance. [ABSTRACT FROM AUTHOR]

Profits-only partnership interests grant service-providing partners an interest in the profits of a partnership but not its capital. Such interests are a proverbial double-edged sword: they create economic arrangements needed in business, but provide opportunities for inequitable tax reductions. Business participants make economic decisions to use profits-only partnership interests to reduce agency costs and appropriable rents. The current law, however, empowers business participants to form partnerships that are equivalent to employment arrangements and use profits-only partnership interests to obtain long-term capital gains. Thus, with no economic consequences, they convert ordinary income (taxed at up to thirty-five percent) to long-term capital gain (taxed at fifteen percent). Commentators and lawmakers generally propose partnership disaggregation to eliminate the inequity. Partnership disaggregation changes the character of income (from capital gain to ordinary income) as it flows from the partnership to service-providing partners. Partnership disaggregation may enhance equity, but it ignores the nature of tax partnerships, threatens the partnership tax regime, and has other negative side effects. This Article suggests that partnership disregard is a better way to address the inequity caused by profits-only partnership interests. Partnership disregard uses economic concepts to identify the policy-relevant differences between tax partnerships and disregarded arrangements, such as employment arrangements, leases, and loans. Partnership disregard distinguishes arrangements that should qualify for partnership tax treatment from those that should not. It eliminates inequity while preserving the integrity of the partnership tax regime and other areas of the law. [ABSTRACT FROM AUTHOR]

We apply the paradigm of the firm as a nexus of contracts to the debate on regulatory competition vs. unification of law as an alternative way of regulating the business corporation. This approach views the business corporation as a set of coordinated contracts among different parties. Agency problems and related agency costs are the result of this interaction. The economic analysis of corporate law, securities regulation and bankruptcy law identifies law as a means to minimise such agency costs. In this paper, we develop a model where companies are heterogeneous in their preferences about the legal regulation of contractual relationships. We then compare a regime of regulatory competition with one of single supply of regulation and we analyse their relative costs and benefits. [ABSTRACT FROM AUTHOR]

Although price-fixing conspiracies are inherently unstable, many cartels manage to endure, often for long periods. Many successful cartels have hierarchical structures made up of high-level executives (principals) and lower-level managers (agents). For these cartels, agency cost theory could provide some insights as to how to destabilize them from within. Agency costs exist when a faithless agent pursues her own interests instead of those of the principal. Although agency costs are generally considered inefficient, when the principal's goals are undesirable, the acts of a faithless agent can be beneficial. Because one traditional approach to reducing agency costs is to align the interests of the principal and agent, this Article argues that antitrust policy should maximize agency costs in cartels by decoupling these interests through several interrelated strategies. First, antitrust law should increase the severity and probability of criminal punishment of individuals who participate in price fixing. Second, antitrust law should reward individuals who expose cartel activity by providing them immunity from all criminal and civil liability and by paying antitrust bounties to such faithless agents. Finally, antitrust law should be structured so that employees of a cartel firm will not trust their employers to protect them should the cartel be exposed. This Article discusses how antitrust law can perform this decoupling function while minimizing any negative consequences of creating distrust within firms. [ABSTRACT FROM AUTHOR]

The article focuses on a note which explores the divided conception of secrecy and transparency. The problem of secrecy and transparency is considered from the viewpoint of the principal-agent correlation and advocates innovative approaches that centered on decreasing the total agency costs in the relationship between voters and their representatives. It presents the three mechanisms that could reduce agency expenses. The author aims to discover new ways to think about the secrecy and transparency dilemma and suggests that it is worth to investigate mechanisms to capture as many of the benefits of secrecy as possible minimizing agency costs.

The traditional law and finance focus on agency costs presumes that the premise that diversified public shareholders are the cheapest risk bearers is immutable. In this Essay, we raise the possibility that changes in the capital markets have called this premise into question, drawn into sharp relief by the recent private equity wave in which the size and range of public companies being taken private expanded significantly. In brief, we argue that private owners, in increasingly complete markets, can transfer risk in discrete slices to counterparties who, in turn, can manage or otherwise diversify away those risks they choose to forego, arguably becoming a lower cost substitute for traditional risk capital. If diversified shareholders are no longer the cheapest risk bearers, then the associated agency costs may now be voluntary; and if risk management can substitute for risk capital without requiring a transfer of ownership, then why go public at all? Do more complete capital markets herald (once again) the eclipse of the public corporation? We offer some preliminary responses, suggesting that the line between public and private firms may begin to blur as the balance between agency costs and the benefits of public ownership shift toward a new equilibrium. [ABSTRACT FROM AUTHOR]

We examine the potential role that agency costs have on dividend payout policy in the restaurant industry. Specifically, we hypothesize that dividends serve to constrain the actions of management. Interest payments also have the same effect, and in a sense, may act as an effective substitute for dividend payments. Furthermore, the larger number of firm owners, the greater the need for dividends to control agency costs. Our findings show significant differences in debt ratios and the number of shareholders between restaurant firms that pay dividends and those that do not. [ABSTRACT FROM AUTHOR]

In this paper we analyse the impact of the capital structure, the ownership structure and the payout policy on managers' discretionary decisions. We have identified some manifestations of the agency costs and we have examined the effect of the mechanisms of control on the agency costs. Based on two measures of the agency costs concerning managers' efficiency on assets performance and on the most discretionary costs, our results stress the role of the mechanisms of control. The capital structure does not seem to work as a mechanism to monitor the managers whereas the ownership structure plays a relevant role and can be divided into two issues: the equity ownership concentration and the managers' ownership. The payout policy has a relevant influence on managers control too. [ABSTRACT FROM AUTHOR]

The article presents information on issues related to class action litigation and the agency costs involved in the U.S. legal system. Class action lawyers desire to maximize their gain, even by charging compensation from class members. Many scholars have argued that the rules related to class action need to be amended in the civil justice system to protect litigants' interest.

The capillarity of the financial sector, which performs its activities in several cities and consequently thousands of agencies demands, as a way to appropriately represent the institution, not only the promotion but also the transfer of executives to occupy management position in other cities and agencies acting as institutions' owners/stockholders institutions. This paper analyzes the existence of familiar conflicts originated from a promotion and/or transfer and if these eventual conflicts may influence the managers behavior, in extent to produce some agency cost. Thus, based on the Agency theory and organizational conflicts literature, a group of managers in a brazilian financial institution was researched. As a result of a questionnaire application, the managers consult their families during the promotion and/or transfer process and that process may generate conflicts. The results indicate that, according to the researched managers, they can be influenced by a promotion and/or transference situation, being able to have their performance jeopardized, generating agency costs. [ABSTRACT FROM AUTHOR]

The article explains the charter schools' use of for-profit and nonprofit forms by applying the agency costs theory and suggests ways to make charter school regulation more sensitive to the differences between these forms. It also uses Henry Hansmann's contract failure theory to argue the domination of nonprofit forms. It also suggests that changes in regulation must be made to control for-profits more tightly and to reflect nonprofits' and for-profits' relative strengths more accurately.

Abstract: This paper investigates the benefits and associated agency costs of using internal capital markets through affiliating with groups using data of 2000 firms from 9 East Asian economies. We find that mature and slow-growing firms with ownership structures more likely to create agency problems gain more from group affiliation, while young and high-growth firms lose more. Agency problems are important determinants of the distribution of internal markets value gains in economies outside Japan, but less so in Japan. Consistent with the literature, financially constrained firms benefit from group affiliation. Our results are robust to different time periods and estimation techniques. [Copyright &y& Elsevier]

During the 1990s, concerns that nonprofit (NP) hospitals were being sold at below-market prices to investor-owned (JO) chains helped to prompt the widespread adoption of state laws regulating the sale and conversion of nonprofits. In this paper, we provide a simple test of under-pricing using the JO acquirer's abnormal stock market returns at the time of the acquisition. Prior to regulation, we find that 10 chains did not earn abnormal returns from their acquisitions of NPs and earned greater returns from purchasing other JO and privately owned hospitals. In states that subsequently adopted regulations, acquisition activity slowed significantly and acquirer returns became negative. Efficient markets theory suggests that, absent regulation, expected merger synergies were already being transferred to the NP target and that regulation may have reduced expected synergies or increased the costs of acquiring NP hospitals. [ABSTRACT FROM AUTHOR]

We extend the Maquieira and Danús (1998) study. In doing so, we use the model proposed by Rozeff (1982) to determine dividend payments. This model considers two opposites factors which may explain the dividend payout policy-- transaction costs and agency costs. We do a cross sectional analysis on a sample of fifty four Chilean public companies in the Santiago Stock Exchange during the period 1996-2002. We find that dividends signal future growth of the companies. Furthermore, the greater the percentage of shares owned by insiders the higher the dividend payout. Finally, we find that the past growth rate of the companies is negatively associated with the dividend payments. [ABSTRACT FROM AUTHOR]

To minimize agency and user costs in a bridge repair project, a bridge maintenance manager should develop an appropriate project schedule considering real-world constraints such as resource limitations (e.g., workspace and crew). This paper presents a new framework called Simulation-based Bridge Maintenance Optimization (SiBMO) by integrating Genetic Algorithm (GA) and Discrete Event Simulation (DES) to identify the optimum maintenance plan taking into account crew limitations. The framework optimizes the sequence of repair-activities in the repair interventions considering workspace limitations and predecessor relationships. SiBMO also develops a high-level schedule of the interventions regarding the project calendar and the Traffic Management Plan (TMP). The Bridge Information Model (BrIM) based user interface developed in this study visualizes the high-level schedule. The results of applying SiBMO on a real case study demonstrates its capability in finding the optimum maintenance plan, its efficiency in optimizing the high-level schedule, and its accuracy in estimating user costs. • The framework optimizes the bridge maintenance plan considering crew limitations. • It identifies the optimum schedule with the minimum user costs for repair projects. • It regards workspace and crew limitations to optimize the repair project schedule. • It finds a high-level project schedule regarding traffic plan and working hours. • This framework integrates the Genetic Algorithm and Discrete Event Simulation. [ABSTRACT FROM AUTHOR]

We study the determinants of the dividend payout ratio considering a model that minimizes the sum of transaction and agency costs. Using a cross-sectional analysis on a sample of 60 Chilean public traded companies from 1986 to 1992, we examine the relationship between the dividend payout ratio and the expected growth rate, the beta, the percentage of shares helds by insiders and the number of stockholders. We find a positive and statistically significant relationship between the dividend payout ratio and the expected growth rate, which can be consistent with the signaling hypothesis. [ABSTRACT FROM AUTHOR]

Life cycle cost analysis (LCCA) has received notable attention and application within the road industry. As one of the three pillars in sustainability assessment, LCCA offers an empirical framework to assess costs over the entire lifespan of road projects. To incorporate the agency and user cost for all different life cycle phases, a robust framework is needed. Thus, it is vital to gain insight into the application and limitations of LCCA in road projects. Reviewing the existing economic models and frameworks, with a particular focus on road projects, will be the first step in providing a robust and uniform model. The goal of this paper is to provide a state-of-the-art review of existing methodologies in the wider field of LCCA for road projects. Hence, it can highlight critical processes and identify hotspots so the robustness of LCCA frameworks can be increased. It is concluded that agency costs related to the end of life (EOL) phase, transport and road user costs are often excluded despite having a substantial impact. However, with sustainability in mind, these aspects are important and should always be incorporated. Modelling the EOL enables the user to include the effect of recycling, hence, lowering the economic impact of raw material extraction. Additionally, road user costs are closely related to the social aspect of sustainability assessment. Finally, this paper presents the inconsistent use of modelling parameters, e.g. discount rate and analysis period, which supports the conclusion of a missing conclusive and robust framework. • 71% of the analysed case studies applied a discount rate between 2% and 5%. • Salvage and residual modelling are used interchangeably despite their differences. • Transport costs between individual life cycle phases are often excluded or unknown. • Only 48% of the cases consider the full life cycle of a road in LCCA. • The NPV is the most applied economic indicator for LCCA in road engineering. [ABSTRACT FROM AUTHOR]

In pavement management systems, it is beneficial to consider the economies of scale stemming from the synchronization of repairs conducted on neighboring sections within a single work zone. However, finding the globally optimal solution of the repair and work zone policy for a large-scale pavement network along a long-term planning horizon can be computationally cumbersome. In this study, as a benchmark, we first propose an exact solution algorithm based on dynamic programming. Then we second propose a computationally feasible methodology, a time-invariant simplified rule, to determine desirable (near-optimal) policies. The proposed methodology is applied to two numerical studies: (i) Case 1 for a small-scale road pavement system to compare life cycle costs and computational times between the rule-based methodology and the exact solution algorithm, and (ii) Case 2 for a real-scale road pavement system to discuss the effectiveness of the rule-based methodology. In Case 1, the rule-based methodology derives a near-optimal solution with a significantly shorter computational time than the exact solution algorithm. Case 2 shows that the rule-based methodology can find a superior policy to the aggregation of the optimal solutions independently found for each of decomposed sub-systems in a feasible computational time. Through sensitivity analyses, we find that the repair and work zone policies should vary depending on the deterioration process, cost factors, and weight between agency and user costs for society's view or available budget for the agency's perspective. • Jointly optimize long-term pavement repair and work zone policies. • Consider the economies of scale stemming from the synchronization of repairs. • Develop optimal solution and rule-based approximation. • Apply the proposed methods to two numerical studies for validation. • Derive practical insights through sensitivity analyses. [ABSTRACT FROM AUTHOR]

The relationship with customers has important implications for operating decisions as well as firm performance. One important aspect of the supplier–buyer relationship is the contract duration, and how this factor is likely to affect firm investments has been under-researched. This study aims to investigate whether corporate innovation is linked to the maturity of contracts between suppliers and buyers. Using a sample of 1516 manufacturing firms in Vietnam for the period of 2014 to 2018, we find that longer-term contracts are positively related to firm propensity of innovation. However, only contracts with foreign purchasers have this characteristic, confirming the supportive role of foreign partners in uplifting the technology for domestic suppliers in a developing country. Interestingly, longer contracts do not tend to facilitate firm innovation or raise the aimed level of newness for firms with very long contracts compared with those that have short-term contracts. This is consistent with the agency cost theory. These findings are robust to different specifications and econometric approaches. Based on the findings, implications are provided to manage the relationship with customers more efficiently. [ABSTRACT FROM AUTHOR]

We examine the effect of family control on firm value and corporate decision during Thailand's constitutional change arising from the 2014 coup d'état. We find that Thai family firms perform poorly when compared to non-family firms during the period of political uncertainty. The effect is more pronounced when firms have high expected agency costs from outside investors. Further, we find that family firms delay their investments, hold less cash, pay smaller dividends and have poorer access to debt financing sources relative to non-family firms. The reductions in investment and financing activities may at least partially account for their underperformance. Our evidence is consistent with the view that family control enhances firms' survivorship by establishing political connections in times of political uncertainty at the expense of minority shareholders. • Family firms performed poorly compared to non-family firms during Thailand's 2014 coup d'état. • The effect is more pronounced in firms with higher expected agency costs from investors. • Family firms delay their investments, hold less cash, pay smaller dividends and have poorer access to debt financing sources. • The reduction in investment and financing activities underscore their inferior performance. • To survive, family control establishes political connections at the expense of minority investors. [ABSTRACT FROM AUTHOR]

Recent papers have investigated how assurance increases the credibility of, and confidence in, sustainability disclosure. However, there is debate about the quality of this process. As part of this debate, the authors examine, firstly, whether the provision of audit and sustainability assurance services by the same practitioner affects the quality of the assurance, focusing on a trade-off between the knowledge spillover effect and the economic dependence effect. Secondly, the authors also examine whether the industry specialization of the assurance provider could moderate the above relationship, reinforcing the knowledge spillover or reducing the economic dependence effects. Using international data from the period 2007–2016, evidence supports that the provision of audit and sustainability assurance services by an incumbent auditor produces knowledge spillover, leading to higher assurance quality. Results also find that industry specialization increases the provider's knowledge of matters on which sustainability assurance is given and enhances the impact of joint provision on assurance quality. The analysis is further extended to explore this evidence in contexts characterized by higher agency costs, by a country's greater stakeholder-orientation, a country's greater rate of demand for assurance, and countries where assurance is non-mandatory. Image 1 [ABSTRACT FROM AUTHOR]

This paper studies the relationship between managers' private profit and agency cost using dynamic modelling methods. We conclude that the agency cost is a concave function of the managers' private profit and that the managers' private profit will lead to more investment cash outflow. [ABSTRACT FROM AUTHOR]

Sustainable development requires decision-making systems based on sustainability criteria and overpassing just economic and financial criteria. Integration of life-cycle cost analysis (LCCA) and life-cycle assessment (LCA) to select pavement alternative is a solution to address economic and environmental issues simultaneously. While most of current methods related to sustainable design of pavements consider environmental parameters as economic factors i.e. cost, this paper takes the two criteria of carbon emissions and energy consumption into account. Moreover the presented method considers the embedded managerial flexibilities which are available due to existing uncertainties in pavement project valuation procedure. Agency costs, user costs, carbon emissions, and energy consumption are considered as the main criteria, and Monte Carlo simulation (MCS) technique is used with a recursive procedure for analyzing flexibility in each time step of pavement life-cycle. For making the best decision in each time step and the best overall alternative, technique for order of preference by similarity to ideal solution (TOPSIS) is used, and the best alternatives are reported. The model is applied in a highway project in Iran to demonstrate its capabilities to analyze the sustainability of different asphalt and concrete alternatives for pavement projects. Various alternatives of the two pavement types are compared and it is clarified that the best asphalt alternative has lower life-cycle costs but more carbon emissions and much more energy consumption. Selection of concrete pavement instead of asphalt pavement in last decade in Iran, will approximately 35% increase related costs but it will result in about 2,000,000 tons of carbon emissions reduction and 700,000 GJ reduction in energy consumption annually. • An integrating LCA and LCCA model is proposed for sustainable pavement selection. • Recursive dynamic programming method is used for consideration of managerial flexibilities. • TOPSIS is used for multi criteria decision-making with preferred weights. • Cement pavements have 12% less environmental effects than Asphalt pavements. • Cement pavement have 55% less energy consumption than Asphalt pavements. [ABSTRACT FROM AUTHOR]