Managerial Overconfidence and Share Repurchases

Following prior studies, we use keywords in press portrayals to gauge managerial overconfidence. We hypothesize that managerial overconfidence is related to a manager's perception that the firm is undervalued. Results from 2744 share repurchase programs launched by 783 listed firms in Taiwan confirm this hypothesis. We find that managerial overconfidence is positively correlated with the intensity of share repurchasing, which is measured by scale, execution, frequency, and the difference between the announced price and post‐execution price. Moreover, the programs launched by overconfident managers were not undervalued and therefore were associated with reduced post‐announcement returns.     

Efficiency and productivity comparisons between outsourcers and non-outsourcers: Evidence from a metafrontier production function with endogenous switching

This paper aims to compare productivity and technical efficiency (TE) between outsourcers and non-outsourcers with an empirical methodology that accounts for both heterogeneous production technologies and non-random sample separation. Using plant-level data on six two-digit manufacturing industries in Taiwan over the period 2002–2005, the endogenous switching regression and the stochastic metafrontier methodology enable us to generate TE scores that are comparable across production units that operate under different technologies without the standard assumption in the literature that the outsourcing status is out of the control of the plant and that outsourcers and non-outsourcers use the same technology. We find that outsourcers are, on average, more technically efficient and technologically advanced than non-outsourcers. Productivity differences account for the lion's share of the outsourcer–non-outsourcer output gap.     

Deconstructing the internal structure of perceived authenticity for heritage tourism

Abstract

Although modern society is more inclined to view authenticity from a postmodernist perspective, few quantitative studies on heritage tourism explored existential authenticity in detail. This study deconstructs authenticity into three components – object-related, intra-personal, and inter-personal – and then constructs a complete model by exploring each component’s internal structures, asking to what extent travel motivation is an antecedent and loyalty, a consequence. Data were obtained from 1,088 valid survey questionnaires distributed in Pingxi, Taiwan. Study findings confirmed the reliability and validity of the items used to measure the construct of authenticity. Regarding the internal structure of authenticity, intra-personal authenticity plays a mediating role between object-related authenticity and inter-personal authenticity, and this inter-personal authenticity may be the final value that tourists perceive. Compared with recent related studies, this model more comprehensively explains the degree of variation in loyalty, reflecting its importance for heritage tourism management and marketing. If a destination remains authentic, tourists are willing make a return visit. Authenticity may enable tourism managers to strike a balance between preservation and development when achieving the long-term goal of sustainable development.     

The role of intellectual capital and university technology transfer offices in university-based technology transfer

This study develops a theoretical model to explain the relationships among intellectual capital, research outcomes, and technology transfer (TT) performance, investigating the role of university TT offices (UTTOs) in the innovation process. The authors examined these relationships by sampling 49 Taiwanese universities within a 2-year period. It is concluded that universities with specialized UTTOs indeed promote TT performance (TTP) based on university–industry cooperation. Furthermore, the results indicate that human capital is positively associated with research outcomes and relational capital. The greater the amount of relational capital, which represents the degree of university–industry cooperation, the more significant is the positive effect on research outcomes and TTP. The more research outcomes are produced, the more academic research and patent technology will be transferred to industry.     

An examination of key factors influencing bancassurance success – Taiwan and mainland China evidence

The aims of this paper are first, a search for the key factors that influence bancassurance operation in Taiwan and mainland China; second, explore the weight of each key success (critical) factor (KSF); and third, identify performance gaps typically measured as performance minus KSFs. This study adopts the analytical hierarchy process to construct a framework of KSFs of bancassurance. Then, the importance–performance analysis is applied to identify the performance of each KSF for bancassurance. The findings mean that the strategy maker can identify the weakness and strength of their bancassurance strategy, and allocate their resources accordingly.     

Transmission effects of the U.S. and China monetary policy shocks on the world

This paper applies the Markov-switching model to analyse the transition probabilities and generalized method of moments (GMM) with Newey–West heteroscedasticity and autocorrelation consistent covariance estimators (HAC) to examine the continuity of monetary policies in different countries when the U.S. and China change their monetary policies. Our results indicate that the euro area’s monetary authority continues to increase/decrease their money supply to stimulate/depress the economy. In Japan, long-term economic recession motivated the Japanese government to maintain a loose money supply. The continuity of Korea’s monetary policy in expansionary states lasts up to 5.1 years. Besides, the outcomes show the implementation of U.S. quantitative easing (QE), overnight reverse repurchase agreement (RRP), and Chinese RRP policies have significant spillover effects on other nations. Particularly, the effects on the euro area are the largest. Furthermore, although the monetary policies of China and the euro area seem to move in opposite directions, they are interdependent.     

On the predictive power of ARJI volatility forecasts for Bitcoin

Motivated by the recent literature on cryptocurrency volatility dynamics, this paper adopts the ARJI, GARCH, EGARCH, and CGARCH models to explore their capabilities to make out-of-sample volatility forecasts for Bitcoin returns over a daily horizon from 2013 to 2018. The empirical results indicate that the ARJI jump model can cope with the extreme price movements of Bitcoin, showing comparatively superior in-sample goodness-of-fit, as well as out-of-sample predictive performance. However, due to the excessive volatility swings on the cryptocurrency market, the realized volatility of Bitcoin prices is only marginally explained by the GARCH genre of employed models.     

The Effects of Different Teaching Approaches in Introductory Financial Accounting

Abstract

The purpose of the research is to examine the effect of the two different teaching approaches in the first accounting course on student performance in a subsequent finance course. The study compares 128 accounting and finance students who took introductory financial accounting by either a user approach or a traditional preparer approach to examine their academic performance on a subsequent finance course. The results indicate that there is no significant difference in the finance course grade between students who took the traditional introductory accounting course and students who were taught under the user approach. These findings support the argument that the user approach has no impact on subsequent finance course grade and either method can be used to teach introductory financial accounting. Three factors were found to affect subsequent performance in an introductory finance course: GPA prior to taking the finance course, grades in macroeconomics, and statistics.     

Price discovery in stock index: an ARDL-ECM approach in Taiwan case

In this study, we examine the lead-lag effect between stock index futures and its spot markets in Taiwan by employing a newly developed econometrics method, ARDL-ECM approach. The advantage of applying such technique is to avoid earlier ambiguous causality testing procedure, and it can provide more clearly representation of a stable unidirectional price discovery process. By verifying intraday data, we find that the futures prices lead spot markets for about 30 min during the year 2004. Moreover, during the presidential election period which caused political turbulent in Taiwan, the function of future market supposed as the dominated role of price discovery becomes futility. Such findings are consistent with the ‘surprising election outcomes’ phenomenon.     

Outlier Detection in the Lognormal Logarithmic Conditional Autoregressive Range Model

An outlier detection procedure in the lognormal logarithmic conditional autoregressive range (lognormal Log‐CARR) model is proposed. The proposed test statistic is demonstrated to be well‐sized and to have good power using Monte Carlo simulations. Furthermore, the outlier detection procedure suffers less from the masking effect caused by multiple outliers. The results of an empirical investigation show that the proposed method can effectively detect volatility outliers and improve forecasting accuracy.