Sources of business fluctuations: Financial or technology shocks?

Despite the widespread belief that technology shocks are the main source of business fluctuations, recent empirical studies indicate that in the absence of financial frictions, a shock to the marginal efficiency of investment is the main source and is closely related to financial conditions for investment. We incorporate a financial accelerator mechanism and two types of financial shocks to the external finance premium and net worth in a dynamic stochastic general equilibrium model with shocks to the marginal efficiency of investment, the investment-good price markup, and the rates of neutral and investment-specific technological changes. This model is estimated using eleven US time series that include data on loan, net worth, the loan rate, and the relative price of investment. Our estimation results show that the (non-stationary) neutral and investment-specific technology shocks primarily drive output and investment fluctuations, while the external finance premium shock plays an important role for investment fluctuations. This financial shock induced substantial falls and subsequent sharp hikes in the external finance premium and caused boom–bust cycles over the past two decades.     

家族企业代际传递促进了企业创新吗？ ——来自创业板市场的经验证据

摘要：家族企业代际传承究竟会给企业创新带来什么样影响是一个重要且仍具争议的话题。本文试图从人力资本视角，发掘家族企业二代接班者对企业创新行为的重要影响。结果显示：家族企业二代接班者更倾向于激励企业创新行为，这一激励不仅有利于促进企业加大内部研发投入而且还会通过资本运作来实现企业外延式创新，上述研究结论在削弱内生性问题又依旧保持稳健。本文的研究发现为家族企业代际传递与创新问题提供理论验证，对家族企业创新实践和人力资本管理具有一定的启示意义。     

Hong Kong's growth synchronization with China and the US: A trend and cycle analysis

This paper investigates the synchronization of Hong Kong's economic growth with mainland China and the US. We identify trends of economic growth based on the permanent income hypothesis. Specifically, we first confirm whether real consumption in Hong Kong and mainland China satisfies the permanent income hypothesis, at least in a weak form. We then identify the permanent and transitory components of income of each economy using a simple state-space model. We use structural vector autoregression models to analyze how permanent and transitory shocks originating from mainland China and the US affect the Hong Kong economy, and how such influences evolve over time. Our main findings suggest that transitory shocks from the US remain a major driving force behind Hong Kong's business cycle fluctuations. On the other hand, permanent shocks from mainland China have a larger impact on Hong Kong's trend growth.     

Examination of Taiwan's travel and tourism market cycle through a two-period Markov regime-switching model

This study analyzes the Taiwan travel and tourism (T&T) market cycle. According to data of the weighted Taiwan tourism stock index from January 1997 to August 2015, the two-period Markov regime-switching model identifies two distinct regimes of the T&T cycle and incorporates a specific set of mean and variance parameters for each period to control for the structural changes in Taiwan's T&T market. The effect of China visitor arrivals to Taiwan on the T&T market is also verified. The empirical findings offer essential information and policy implications for Taiwan's government tourism policymakers and business managers.     

The relationship between business diversification and productivity: considering the impact of process innovation at different corporate life cycles

This paper investigates the link between a firm's process innovation (PI) and its segment productivity at different life cycles. The results show that business diversification is negatively associated with a firm's productivity, and further reveal that a firm's PI moderates the above relationship. In addition, the corporate life cycle literature builds blocks for this study to explain that the involvement of administrative costs varies across life cycles when diversified firms get mature and bigger. Our empirical evidence indicates that the potential costs of a complex organisational structure contingent on business diversification at a firm's mature life cycle could be alleviated by the conduct of process innovation. As process innovation at different life cycles may alter managerial incentive that leads to different firm performance, the managerial implication is that diversified firms should appropriately engage in process innovation to prevent unfavourable liability from the development of their businesses.     

Drivers of airline loyalty: Evidence from the business travelers in China

This paper examines the key factors that determine business traveler loyalty toward full-service airlines in China. Based on literature review and panel interview, ten airline attributes under three categories were derived: (a) operational factors: safety, punctuality, and aircraft; (b) competitive factors: frequency of flights, schedule, frequent flyer program, ticket price, and reputation; and (c) attractive factors: in flight food & drinks and in flight staff service. We surveyed 2000 Chinese business travelers on domestic flights, obtaining 462 usable questionnaires. Hierarchical regression analysis reveals that reputation, in-flight service, frequent flyer program, and aircraft have the greatest influence in driving airline loyalty.     

Is ex-post credit risk affected by the cycles? The case of Italian banks

The objective of this research is to empirically examine if both credit and business cycle affect the ex-post credit risk (i.e. non-performing loans) in the banking system of Italy for the period 1995Q1–2014Q1. The increase in NPLs post-2008 has put into question the robustness of many European banks and the stability of the whole sector. It still remains a serious challenge, especially in Italy which is one of the countries that hit by the financial crisis. By employing fixed and random effects and a dynamic GMM estimation as econometric methodologies I find results that underline common causes for NPLs. Higher NPLs in Italy are mostly due to worse macroeconomic conditions (i.e. bad phase of business cycle) and due to excess credit. Through a Granger causality test, my arguments found even more support. Such findings can be helpful when designing macro-prudential as well as NPL resolution policies.     

Key institutions in business and management education research

The authors investigate institutional productivity in business and management education (BME) research based on the analysis of 4,464 articles published by 7,210 authors across 17 BME journals over a 10-year period, involving approximately 1,900 schools worldwide. Departing from traditional disciplinary silos, they examine the BME research field as a whole by including all traditional business disciplinary areas and producing two top 100 rankings, one based on raw number of author publications and the other based on weighted scores reflecting journal quality and coauthorship.     

The importance of firing costs and the Hosios condition in search models with endogenous job destruction

We construct a DSGE search model with endogenous job destruction, incorporating wage rigidities, firing costs and unemployment benefit. We investigate the most important factors in matching the model’s cyclical properties with empirical data, particularly those of job creation rates (JCR) and job destruction rates (JDR). Firing costs assist significantly in explaining the procyclicality of JCR, the negative correlation of JCR and JDR, and the persistence of vacancies. They also decrease the counter-cyclicality of job turnover. We also postulate that the Hosios condition helps explain the negative correlation of JCR and JDR and vacancies’ persistence. Varying wage rigidities and unemployment income, however, do not improve the results.