Performance measure properties and efficacy of incentive contracts: perceptions of U. S. employees

This paper examines how employees perceive the impact of performance measure properties (noise and distortion) on the efficacy of incentive contracts in the United States. It surveys 98 employees at middle and lower levels of U. S. firms across different industries. The survey results show that employees perceive noise and distortion in performance measures to significantly influence the overall efficacy of incentive plans. Specifically, employees perceive that incentive plans with less noisy or distorted measures attract better employees to their firms. However, employees do not perceive lower noise or distortion in performance measures to motivate more effort in their work after controlling for the selection effect of incentive plans. These results illustrate the importance of performance measure properties in the U. S. incentive contracts and provide evidence regarding cross-national differences in management practices.     

Examining the impacts of community and organization embeddedness on self-initiated expatriates: the moderating role of expatriate-dominated private sector

With a newly developed dimension of the job embeddedness construct and the aim to better understand turnover, this study investigates the relationships of job embeddedness with shocks and turnover intention for an important emerging group in the worldwide workforce – self-initiated expatriates (SEs). We consider three embedding factors: individuals' community embeddedness towards their home country (home country community embeddedness – HomeCCE – newly developed), embeddedness towards the organization in which they are employed in the host country (host country organization embeddedness – HostCOE) and embeddedness towards the host country community (host country community embeddedness – HostCCE). Structural equation modelling is applied to a sample of SEs from 10 three-star to five-star hotels in the Macau SAR of China. This research shows that HostCOE plays a mediating role between a SEs' HomeCCE and turnover intention and willingness to accept unsolicited job offers; and these mediated relationships are moderated by the variables: expatriate-dominated private sector and the SEs' HostCCE. These findings shed light on factors that affect the retention of SEs and have implications for management and future research.     

Elucidating the Relationship Between Satisfaction and Citizen Involvement in Public Administration

Abstract

This study analyzes the relationships between public administration satisfaction (PAS), political efficacy (PE), and active citizen involvement (ACI). The study group consists of 345 respondents residing in Taiwan. Respondents are interviewed by phone to obtain their perceptions regarding local municipality operations (i.e. professionalism and sympathy (PS), ambition to improve (AI), neutrality and morality (NM)), PAS, ACI, and PE). These relationships are verified by conducting path analysis. Results of this study demonstrate that AI and NM positively affect PAS, that PAS positively affects PE and ACI, and that PE plays a mediating role in the relationship between PAS and ACI.     

A study of the relationship between corporate governance structures and the extent of voluntary disclosure

The primary objective of this study is to test a theoretical framework relating four major corporate governance attributes with the extent of voluntary disclosure provided by listed firms in Hong Kong. These corporate governance attributes are the proportion of independent directors to total number of directors on the board, the existence of a voluntary audit committee, the existence of dominant personalities (CEO/Chairman duality), and the percentage of family members on the board. Using a weighted relative disclosure index for measuring voluntary disclosure, the results indicate that the existence of an audit committee is significantly and positively related to the extent of voluntary disclosure, while the percentage of family members on the board is negatively related to the extent of voluntary disclosure. The study provides empirical evidence to policy makers and regulators in East Asia for implementing the two new board governance requirements on audit committee and family control.     

Optimal nonlinear pricing by a regret-averse monopoly

This paper examines the optimal nonlinear pricing by a monopolist who sells a good to two types of buyers with high and low valuation. The monopolist's preferences are characterized by a modified utility function that includes disutility from having chosen ex-post suboptimal alternatives. Regret aversion is shown to affect the rent extraction-efficiency tradeoff. When buyers are more likely to have high (low) valuation, the regret-averse monopolist reduces (enlarges) the downward distortion on the second-best quantity offered to low-valuation buyers, thereby resulting in lower (higher) unit prices paid by all buyers. The regret-averse monopolist always earns a lower expected profit.     

Return windows and the value relevance of earnings

Research on the value relevance of annual earnings commonly accumulate stock returns over a 12-month period starting from the fourth month of the fiscal year, resulting in a mismatch between the return window and the earnings period (i.e. the fiscal year). By comparing this return window with alternative windows, we show that the mismatch produces a downward bias in the estimated R² from the regression of stock returns on earnings, especially for firms that announce earnings early. Our results also show that both profits and losses are more value relevant when announced earlier, supporting regulatory calls for timely disclosure.     

The forward-looking ability of the real exchange rate and its misalignment to forecast the economic performance and the stock market return

This paper aims to examine whether exchange rates can predict future changes in the stock market return and in the economic performance of a country. On the basis of a revision that incorporates relative stock price and rational expectation in Dornbusch's dynamic Mundell–Fleming model, I present a model that can be used for analysing the forward-looking ability of the real exchange rate. The model builds on the works of Campbell and Shiller (Journal of Political Economy, 95, 1987 and 1062), MacDonald and Taylor (IMF Staff Papers, 40, 1993 and 89) and Engel (American Economic Review, 106, 2016 and 436) which can also be converted into a forward-looking version of real exchange rate misalignment model to investigate whether the deviation of the real exchange rate from its fundamental value would contain an economically significant predictable component on forecasting the future stock price movement and the real output.     

Validating the Effects of Brand Quality on Attitude and Purchase Intention in Service–Product Alliances

The purpose of this article is to replicate the findings of previous research studying the effects of brand quality on consumer attitude and purchase intentions in service–product encounters. The main contribution of the current research is to improve the generalizability of the previous findings by basing the experimental inquiry on real-world brands. Drawing on information integration and categorization theories, a set of hypotheses are presented that predict both mediating and moderating relationships between the independent and dependent variables. Results from an experimental study confirm previous findings, demonstrating that the quality of a product brand in a service–product alliance has significant effects on the attitude toward the service brand. Such effects are moderated by the quality of the service brand. Alternatively, service brand attributes do not have the same effect on component product brands included in the performance of that service. Service and product quality exhibit the same effects on purchase intentions as mediated by attitude.     

Roles of the Hotel Training Professionals—Perspectives of Industry Practitioners

Becoming a learning organization, better educated and more career-minded employees and the adoption of technologies such as social media are current trends in the training and development world, especially in the hospitality industry. It is important to understand how the roles of training professionals are changing and how this change affects the recruitment process from the perspective of human resources professionals. In-depth interviews and survey were adopted in this study to explore the perspectives of industry practitioners. Seven roles of training professionals are identified and the retention of training professionals in the hotel industry is advocated.     

Hedging and the competitive firm under correlated price and background risk

This paper examines the behavior of the competitive firm under correlated price and background risk when a futures market exists for hedging purposes. We show that imposing the background risk, be it additive or multiplicative, on the firm has no effect on the separation theorem. The full-hedging theorem, however, holds if the background risk is independent of the price risk. In the general case of the correlated price and background risk, we adopt the concept of expectation dependence to describe the bivariate dependence structure. When the background risk is additive, the firm finds it optimal to opt for an over-hedge or an under-hedge, depending on whether the price risk is positively or negatively expectation dependent on the background risk, respectively. When the background risk is multiplicative, both the concept of expectation dependence and the Arrow–Pratt measure of relative risk aversion are called for to determine the firm’s optimal futures position.