Ethics in Research

In the present journal activity report I will summarize my learning on keeping high ethical standards throughout all parts of a study in order to manage the integrity of any researcher involved, as plagiarism is a common ethical issue when conducting research.

Deciding on authorship is a complex task that requires mutual agreement from all researchers involved in a study. The following types of authorships are considered unacceptable in research: (1) Ghost authors contribute substantially to the research and writing of the study, but are not acknowledged. (2) Guest authors do not significantly contribute to the study, but are listed to help increase the chances of publication. (3) Gift authorship is co-authorship given as a gift or award to an individual who has not contributed significantly to a study. As a consequence I recommend the following criteria for best practices for deciding authorship: (1) They must contribute substantially to the study’s design, data acquisition, analysis, and interpretation. (2) They must participate in the drafting or revising of the article. (3) They must approve and accept full responsibility of the final article.

Conflicts of interest arise when a researcher’s obligations to a research project conflict with their personal interests or obligations to another person or organization, as a consequences a researcher should attempt to identify all potential conflicts of interest to other researchers in order to prevent harm or damage to the study. At the same time, find a methodology to resolve the conflicts in a transparent way.

Data management implies the results of a research study must be carefully interpreted, analysed, and presented in order to prevent allegations of research errors and fraud. In Economics there are methodologies developed in order to prevent fabrication and falsification. Some of those methodologies deal with (1) The structure of the data that is used for the research. (2) The way the researchers conducts causality in order to build a model. (3) The definition of units of measure and determination of functional for modelling, which implied resolving problems of model miss specification or over specification. (4) The adequate use of binary variables and instrumental (proxy) variables. (5) The use of the adequate methodology for problems in data: Heteroskedaticity, cointegration, unit ruts, among others.

Finally, plagiarism is an important issue in research and can severely impact a researcher’s credibility and career, as plagiarism is an act of stealing another’s work, the use of an adequate reference system is highly recommended for authors.

Most Appropriate Methods for My Research Question

At my last journal I formulate my research question as “What is the influence of firm’s reputation in it financial structure and its market value?”  This kind of research involves the relationship of a quantitative independent variable (firm’s reputation) with dependent quantitative variables (firm’s financial structure and firm’s market value). Many inexperience researchers may think that this is a very difficult task to do, but econometrics has the solution for this.

First of all you must think of the kind of data that have to be collected. As the research question implies that the firm’s reputation is a new variable to be tested for financial structure and market value, most of the data is quantitative and is reported in firms’ financial statements.

In order to formulate a complete model to test the new variable, we have to take on accont that the Superintendencia del Mercado de Valores, in Peru, publishes every three months the financial statements of approximately 600 hundred firms which operate in Bolsa de Valores de Lima, the kind of data that is need is:

• Adjusted debt and adjusted investment in order to calculate the firms’ financial structure (FINSTRU).
• The firms’ equity market value (MARVAL).
• The firms’ EBITDA and interest in order to estimate the interest coverage ratio (INTCOV).
• The firms’ debt cost (KD).
• The firm’s equity cost, survey from the return of equity (KE-RoE) and return of capital (KE-RoC) indicators.
• The liquidity of the firm (FIRLIQ), estimated by the ratio cash and equivalents over firms’ market value.
• For firms’ reputation (FIRREP) I will use a binary variable that takes the value of 1 when the firm is incorporate at the Good Corporate Government Index (IBGC) by Bolsa de Valores de Lima; which changes every year.
• As the IBGC index is reported since 2010, I will use a balanced panel data.

Knowing the kind of data to be collected, for deduction, quantitative methods must be used to test the hypothesis that firm’s reputation is a new variable to be considered as a determinant of firm’s financial structure and firm’s market value. As a second face, I have identified the models to be tested in terms of the following equations:

As one can deduct, ordinary least squares (OLS) is the main method to be applied in order to estimate the parameters of every model, and parameters’ statistical test will be run in order to reject or accept the hypothesis. The null hypothesis is that every parameter of FIRREP is zero.