Qualitative theory in finance: Theory into practice

Salmona, Michelle; Kaczynski, Daniel J.; Smith, Tom W.

doi:10.1177/0312896214536204

Cited by 29 publications

(28 citation statements)

References 31 publications

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“…1 There are also at least three papers published in the latest issue of the Australian Journal of Management (AJM) in 2015 calling for direct conversation with practitioners in finance. First, Salmona, Kaczynski and Smith (2015) suggest asking practitioners questions where there are no existing databases that can fully address their research questions. Second, Gippel (2015a) mentions in her qualitative method review paper that "21 st -century finance theory is divorced from the reality of practice" to encourage more practitioners' inputs.…”

Section: Introductionmentioning

confidence: 99%

A Contemporary View of Corporate Finance Theory, Empirical Evidence and Practice

2015

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This paper uses a survey of Australian Corporate Treasurers to shed light on the gap between the theory and practice of corporate finance in Australia. Seven areas are examined: capital structure, payout policy, cash holdings, initial public offerings, seasoned equity offering, mergers and acquisitions, and corporate governance. We also exploit the Global Financial Crisis to examine the effect of liquidity shocks on a firm's capital structure choices. We then compare our Australian survey results with results from a comprehensive U.S. survey conducted by Graham and Harvey (2001). Our survey shows that the board of directors play the most important role in determining capital structure decisions and that corporate treasurers play the most important role in cash holding decisions. This contrasts with the academic literature that has typically focused on the role of CEO in both capital structure and cash holdings decisions. In addition, our respondents do not view the tax advantage of interest deductibility to be of first order of importance for debt issuance choices, which contrasts with most of the U.S. empirical studies. Finally, we juxtapose the theory-practice perspective, with a review of the most recent five years (2011)(2012)(2013)(2014)(2015) of corporate finance research published in the leading Asia Pacific Basin finance journals. Abstract This paper uses a survey of Australian Corporate Treasurers to shed light on the gap between the theory and practice of corporate finance in Australia. Seven areas are examined: capital structure, payout policy, cash holdings, initial public offerings, seasoned equity offering, mergers and acquisitions, and corporate governance. We also exploit the Global Financial Crisis to examine the effect of liquidity shocks on a firm's capital structure choices. We then compare our Australian survey results with results from a comprehensive U.S. survey conducted by Graham and Harvey (2001). Our survey shows that the board of directors play the most important role in determining capital structure decisions and that corporate treasurers play the most important role in cash holding decisions. This contrasts with the academic literature that has typically focused on the role of CEO in both capital structure and cash holdings decisions. In addition, our respondents do not view the tax advantage of interest deductibility to be of first order of importance for debt issuance choices, which contrasts with most of the U.S. empirical studies. Finally, we juxtapose the theory-practice perspective, with a review of the most recent five years (2011)(2012)(2013)(2014)(2015) of corporate finance research published in the leading Asia Pacific Basin finance journals.

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Section: Introductionmentioning

confidence: 99%

A Contemporary View of Corporate Finance Theory, Empirical Evidence and Practice

2015

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“…A qualitative study relies on appropriate data and theory to develop accounting concepts, principles and practices (Salmona et al ., ). However, rather than focusing on statistical generalisation, the emphasis is on drawing conclusions about particular contexts.…”

Section: A Research Agenda For Qualitative Accounting Researchmentioning

confidence: 97%

Qualitative accounting research: dispelling myths and developing a new research agenda

Villiers

Dumay

Maroun

2019

Accounting & Finance

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This article deals with some common misconceptions about qualitative research. Qualitative studies are well suited to studying complex interconnections and relationships without reducing the complexity to simple numbers or variables. Rather than excluding outliers from a dataset, qualitative researchers are interested in these exceptions and often examine them in-depth in order to develop better understandings and generate new theories on how accounting develops, functions and influences behaviour. New understandings and theory allow qualitative research to advance recommendations, extend the boundaries of accounting research, and make important contributions to both accounting theory and practice.

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“…Critics within the academic community have noted the over quantification of finance research (Bennis & O'Toole, 2005), that neoclassical finance is producing 'nothing new' (Gippel, 2013) and the use of abstract models bearing no resemblance to reality (Krugman, 2009) while others exhort the field to expand quantitative empirical work beyond pre-existing large databases to listen to practitioners (Salmona et al, 2015). More worryingly, the volume of research relating to ethics in finance is very low compared to other areas within business (Bernadi et al, 2008), and evidence that ethics has been generally ignored (Horrigan, 1987) is indicated by the fact that none of finance's 'top' 40 journals or the journals listed in Cabell (2004) indicate an interest in ethics research (Bernadi et al, 2008).…”

Section: Introductionmentioning

confidence: 99%

Why does research in finance have so little impact?

Brooks

Fenton

Schopohl

et al. 2019

Critical Perspectives on Accounting

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The quantity of finance research has grown enormously over the past two decades, yet questions remain over its breadth and ability to benefit the economy and society beyond academia. Using multisource data, we argue that individual and institutional incentives have fostered insularity and a consequent homogeneity in the discipline. We examine the characteristics of research that is published and cited in the leading field journals in finance, arguing that the work has become abstract and unrelated to real world issues. The work published in the 'top' journals makes increasing use of US data, even where the researchers are drawn from different countries. Using information from impact assessment, publication patterns, and grant capture, we illustrate that this narrow agenda lacks relevance to the financial services sector, the economy or wider society compared to other areas of business and management research. In particular, we highlight the relative absence of research on ethics in academic finance and discuss the likely consequences for the discipline including its relevance to society. P a g e | 1 citation database of peer-reviewed academic studies, 4 and funding data from the Economic and Social Research Council (ESRC, the main UK government funding body for social science research).The two UK research evaluation exercises both provided a panel-based assessment of the 'quality' of research undertaken by UK higher education institutions separately for each subject (referred to as a panel, or more accurately in RAE / REF parlance as a sub-panel). Data from the RAE2008 and REF2014 provide snapshots at those specific points in time of the panels' assessments of the 'quality' of work being undertaken in UK universities over the previous six years in each case (2002-2007 and 2008-2013 respectively). The RAE / REF only take place periodically and thus data are only available for these specific intervals. While the work being assessed comprises publications in (peer-reviewed) journals, monographs, book chapters and working papers, our analysis concentrates on those outputs submitted to the RAE/REF that represent publications in peer-reviewed journals. The nature and purpose of the RAE and REF are summarised nicely in Brooks et al. (2014, p. 991): 'The RAE [and REF are] evaluation[s] of the 'quality'

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Qualitative theory in finance: Theory into practice

Cited by 29 publications

References 31 publications

A Contemporary View of Corporate Finance Theory, Empirical Evidence and Practice

A Contemporary View of Corporate Finance Theory, Empirical Evidence and Practice

Qualitative accounting research: dispelling myths and developing a new research agenda

Why does research in finance have so little impact?

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