Do Family Owners Use Firm Hedging Policy to Hedge Personal Undiversified Wealth Risk?

We examine whether family ownership affects the value impact of the operational and financial dimensions of firms’ hedging policies. We show that family firms’ market valuations are higher than those of non‐family firms, consistent with the view that family firms benefit from family owners’ long‐term perspectives and ability to monitor managers. In addition, while both operational and financial hedging policies per se are valuable in non‐family firms, they do not create any value in family firms. These results support the notion that the founding families’ need to hedge the risk of their undiversified personal wealth portfolio leads to suboptimal risk management decisions.     

Management of frontline financial sales personnel

The employee turnover rate within the financial services industry is one of the highest among all industries. Studies demonstrate that a salesperson’s organizational commitment and propensity to leave are impacted by job satisfaction and emotional exhaustion. This study examines the relationships among emotional exhaustion, organizational commitment, propensity to leave and the facets of job satisfaction. Findings support that: (i) financial services salespeople’s propensity to leave is influenced by emotional exhaustion, (ii) emotional exhaustion is mediated by multi-faceted job satisfaction in predicting organizational commitment and (iii) the facets of job satisfaction are, in part, mediated by organizational commitment in predicting propensity to leave.     

The Euro Bias of Bank Assets in the Eurozone

Abstract:

The integration of eurozone financial markets since the advent of the euro in 1999 has been the center of attention in policy debates and academic research. We analyze the bank assets of monetary financial institutions in Germany vis-à-vis nonresidents. The financial institutions of the eurozone countries have tended to invest in assets of other eurozone countries substantially more since the introduction of the euro. The euro effect is especially stronger in the weaker eurozone economies than in the stronger eurozone economies. Furthermore, the impact of the euro has been even greater in securities than in loans. In this paper, we use Bundesbank balance-of-payment statistics to analyze the euro’s effects on the asset portfolios of German banks vis-à-vis nonresidents.     

Momentum and Foreign Investors: Evidence from the Korean Stock Market

Abstract:

We examine whether the price impact of foreign investors on the Korean stock market from December 2000 to February 2007 generated a momentum phenomenon. In our empirical results, foreigners seem to have exerted a significantly positive impact on prices in “up” markets (periods of positive stock returns), but have had little impact on prices in “down” markets (periods of negative returns). We document that the impact of foreigners’ trades is concentrated in large companies. Most importantly, when the market is in the up state, the returns of stocks of large companies that were positively affected by foreign investors in the previous six-month period continue to increase in the subsequent six-month period. As a result, the subsequent six-month return on a past “winner” stock portfolio is significantly higher than that on a past “loser” stock portfolio. This brings to mind a momentum phenomenon that has been reported not to exist in the Korean stock market.     

Do Export Promotion Agencies Increase Exports?

In this paper, we examine the role of export promotion agencies (EPAs) in promoting exports from Japan and Korea. Looking at two home countries enables us to tackle endogeneity issues by controlling for both country‐pair time‐invariant characteristics and importing‐country time‐varying characteristics. Our empirical results indicate that EPA has a positive and significant effect on exports even when we control for endogeneity. However, the size of the effect becomes substantially smaller, implying the importance of addressing endogeneity in accurately measuring the impact of EPA on exports. In addition, we find that EPA's (marginal) effects are larger in exporting to low‐income trade partners than in exporting to high‐income trade partners.     

How does the second-order learning process moderate the relationship between innovation inputs and outputs of large Korean firms?

We investigate how the second-order learning process moderates the relationship between innovation performance and two types of knowledge seeking behavior, namely exploration and exploitation. We reinvestigate the second-order learning process of the top 100 Korean firms from 1997 to 2007 by capturing CEO turnover, board turnover, and R&D alliances. We argue that the current findings about exploration and exploitation should be reclassified in terms of innovation input and output. We suggest that researchers investigate the organizational learning process to understand the link between innovation inputs and outputs. Our empirical results show that while innovation inputs are not related to exploratory outputs, the second-order learning process reshapes the relationship between both exploration/exploitation type innovation inputs and exploratory innovation outputs, and that the new focus of organizational learning process can refine current innovation literature.     

Explaining post‐IPO venture performance through a knowledge‐based view typology

We extend the knowledge‐based view with a new typology and its application to post‐IPO firm performance. The typology categorizes knowledge development activity along the dimensions of familiarity (whether the firm has experience with the knowledge or it is new) and source (whether the firm creates it independently or with partners). We use this typology to determine direct and interaction effects of knowledge development activity on survival, RoA, and Tobin's q of newly public firms. Using a sample of 1,056 high‐technology manufacturing IPOs in 1990–2005, we find that focused, internal knowledge development correlates with higher performance. We also find a positive interaction effect in combining focused, internal and diversifying, alliance‐based knowledge development, and a negative interaction effect in combining diversifying, internal and alliance‐based knowledge development. Copyright © 2013 John Wiley & Sons, Ltd.     

Impact of coopetition in the alliance portfolio and coopetition experience on firm innovation

This paper examines two interrelated questions: to what extent does coopetition in a firm's alliance portfolio impact the firm's innovation performance? And to what extent does a firm's coopetition experience influence the relationship between coopetition in the alliance portfolio and innovation performance? Conceptually, we advance the concepts of balanced coopetition in a firm's alliance portfolio and coopetition experience and suggest that both balanced coopetition and coopetition experience contribute to firm's innovation outcomes. Results based on a longitudinal data of firms from the semiconductor industry show that moderate to high levels of balanced-strong coopetition in a firm's alliance portfolio positively impact the firm's coopetition-based innovation performance. Further, coopetition experience contributes to innovation performance and positively moderates the relationship between balanced-strong coopetition and innovation performance.     

Exchange rate pass-through to domestic producer prices: Evidence from Korean firm-level pricing survey

This note studies exchange rate pass-through to the prices of domestically produced goods, exploring the firm-level pricing survey conducted by the Bank of Korea. The data reveal the imported inputs channel of, as well as nonlinear and asymmetric, exchange rate-pass-through.