The author systematically examines one of the important issues of information — establishing the market price. He introduces the concept of «search» — where a buyer wanting to get a better price, is forced to question sellers. The article deals with various aspects of finding the necessary information.

Economics of Information

We survey research on financial accounting in the banking industry After providing a brief background of the micro-economic theories of the economic role of banks, why bank capital is regulated, and how the accounting regime affects banks’ economic decisions, we review three streams of empirical research Specifically we focus on research examining the relation between bank financial reporting and the valuation and risk assessments of outside equity and debt, the relation between bank financial reporting discretion, regulatory capital and earnings management, and banks’ economic decisions under differing accounting regimes We provide our views about what we have learned from this research and about what else we would like to know We also provide some empirical analyses of the various models that have been used to estimate discretion in the loan loss provision We further discuss the inherent challenges associated with predicting how bank behavior will respond under alternative accounting and regulatory capital regimes

Financial Accounting in the Banking Industry: A Review of the Empirical Literature

Government accounting and financial reporting aims to protect and manage public money and discharge accountability. These purposes, and the nature of public goods and tax financing, give rise to differences with commercial accounting. This is not yet reflected either in government accounting standards in English-speaking developed nations or in international public sector accounting standards. All of these are heavily influenced by private sector practices, which favour the accrual basis and consolidated reporting. This article argues for a gradual symmetric approach to accruals and a combination of government-wide and fund reporting. The author also proposes some broad accounting principles to promote political and economic accountability.

/pdf/government-accounting-an-assessment-of-theory-purposes-and-m6t6j6wa3u.pdf

Government Accounting: An Assessment of Theory, Purposes and Standards

. Research highlights that most business managers continue to be dissatisfied with the value they perceive they are deriving from their organization's information systems investments. On examining the literature, the dominant perspective is that creating value through information systems is primarily the responsibility of the IS function. Accordingly, to address this chronic malaise, attention generally focuses on the IS function with proposed prescriptions ranging from re-skilling the IS professional through re-engineering the IS function to the ultimate sanction of outsourcing. This paper examines the problem of value creation from IS investments from an organizational as opposed to an IS functional perspective. Drawing on resource-based theory, the paper argues that the effective deployment and exploitation of information should be viewed as a ‘strategic asset’. To leverage value from IS, the paper proposes that organizations must recognize and develop information competencies and that the elements of these competencies are distributed throughout the organization and not solely resident in the IS function. Through a multimethodological approach these information competencies are identified and described. The resultant competencies are then studied in an organizational context. The paper ends by drawing conclusions and articulating further research directions and opportunities

Whose job is it anyway?: organizational information competencies for value creation

The main aim of this paper is to present a systemic framework of what the field of Information Systems (IS) is about; its connecting areas and its central theme. It was born out of a search for structure in providing a cohesive picture of the subject and field of IS for students and business managers. The average manager and executive has difficulty in obtaining an integrated and holistic view of information systems, and it is said that this leads to a lack of alignment between IS and the strategic aims of the enterprise. Students, particularly MBA students, have a similar problem. Using a large number of disparate data sources, including a delphic survey of leading academics, the paper adopted a grounded theory approach in developing an integrating framework of five main areas for the field: (1) IS development, acquisition & support (2) people & organization, (3) information & communications technology, (4) operations & network management, and (5) information for knowledge work, customer satisfaction & business performance. The latter area is proposed as the central, distinguishing theme for the field. The paper also discusses the implications of the framework and how it might be used in teaching, the organizational setting, and IS research.

/pdf/a-systemic-framework-for-the-field-of-information-systems-432z9djw9g.pdf

A systemic framework for the field of information systems

This article assesses the current status of the economics of information. The focus is on the acquisition of information (search) and the incentives associated with asymmetric information (noncooperative game theory). The evolution of these two areas also is presented along with simple examples. Their evolutions have a similar structure. The formal, abstract development of search is separate from its informal, concrete growth. At critical points the two paths intersect. The unification and illumination generated by these sudden meetings propel the economics of search to higher levels of understanding. In the economics of asymmetric information, game theory comprises the formal trajectory and industrial organization, broadly construed, is the relatively informal path. Econometric methods, devised shortly after an intersection, have exploited the empirical aspects of the new search paradigm. Experimental economics is performing an analogous function in the economics of asymmetric information. The article concludes with predictions regarding future developments.

S.S. Lippman

Papers

Information, Economics of