Customer satisfaction and the cost of capital

Using a sample of U.S. firms from 1995 through 2015 and the customer satisfaction scores from the American Customer Satisfaction Index, we find strong evidence that firms with higher customer satisfaction scores enjoy lower cost of equity capital, even after controlling for other factors that determine the cost of equity. In addition, results from a propensity score matched sample analysis, a difference-in-differences analysis, and instrumental variable regressions suggest that our findings are robust to accounting for endogeneity. We also document that customer satisfaction is positively related to investor recognition and financial report quality. The effect of customer satisfaction on the cost of equity increases with the level of information asymmetry, consistent with customer satisfaction mitigating information asymmetry. Overall, our findings suggest that customer satisfaction lowers a firm’s risk and significantly attenuates its financing costs.

     

Cultural distance and cross-border bank linkages

This study investigates the effect of cultural distance on global bank linkages using country-pair data for the period 1990–2013. We followed Schwartz (2006) to measure cultural distance, and employed the number of bank pairs involved in cross-border syndicated lending from the source to target countries as a measure of bank linkages. We found that cultural distance has a negative association with bank linkages. This effect is stronger in countries featuring higher informational asymmetries, as represented by weaker institutions, higher uncertainty, or revolution shocks. Our results hold even when employing alternative measures of bank linkages and cultural distance, and when considering the potential endogeneity of cultural distance.     

The contribution of Western fast food to fast-growing body mass in China

The westernization of Asian countries has led to the rapid expansion of Western-style fast-food restaurants, which are believed to be fueling an unprecedented rise in body mass in these countries. This study tests this belief using longitudinal data from China. Exploiting the opening of a Western-style fast-food restaurant in a particular community, we conduct a transition analysis to make a more convincing causal interpretation than the standard cross-sectional or fixed-effects approach. Considering several measures of fatness, we find no robust evidence of Western fast food having a substantial effect overall, but there is some indication of effect heterogeneity.     

Trade facilitation in ASEAN countries: harmonisation of logistics policies

This paper studies the effectiveness of the implementation of trade facilitation measures in member countries of the Association of Southeast Asian Nations (ASEAN). We evaluate trade facilitation performance and indicate trade facilitation needs and priorities that vary between ASEAN members. In particular, we examine logistics‐related costs in ASEAN and whether the current level of logistics‐related costs could be a burden or an advantage for ASEAN countries. We also identify critical barriers that have impacts on logistics services related to foreign investment and customs across ASEAN. Finally, we propose recommendations for the harmonisation of logistics policies in ASEAN countries aimed at the development of the ASEAN Economic Community.     

Predicting future purchases with the Poisson log-normal model

The negative binomial distribution (NBD) has been widely used in marketing for modeling purchase frequency counts, particularly in packaged goods contexts. A key managerially relevant use of this model is Conditional Trend Analysis (CTA)—a method of benchmarking future sales utilizing the NBD conditional expectation. CTA allows brand managers to identify whether the sales change in a second period is accounted for by previous non-, light, or heavy buyers of the brand. Although a useful tool, the conditional prediction of the NBD suffers from a bias: it under predicts what the period-one non-buyer class will do in period two and over predicts the sales contribution of existing buyers. In addition, the NBD's assumption of a gamma-distributed mean purchase rate lacks theoretical support—it is not possible to explain why a gamma distribution should hold. This paper therefore proposes an alternative model using a log-normal distribution in place of the gamma distribution, hence creating a Poisson log-normal (PLN) distribution. The PLN distribution has a stronger theoretical grounding than the NBD as it has a natural interpretation relying on the central limit theorem. Empirical analysis of brands in multiple categories shows that the PLN distribution gives better predictions than the NBD.     

Continuous disclosure compliance: does corporate governance matter?

Our study investigates the quality of firms’ continuous disclosure compliance during mandatory continuous disclosure reform, and whether the compliance quality is impacted by corporate governance, using the New Zealand market as the setting. We use a novel coding of different categories of disclosures (non‐routine, non‐procedural and internal), which represents the extent of proprietary insider information inherent in disclosures, to evaluate firms’ compliance quality. Our findings provide evidence that firms’ compliance quality improved after the reform, and this improvement is inconsistently impacted by corporate governance. Our findings provide important implications for regulators in their quest for a superior disclosure regime.     

Strategic timing of earnings announcements?

Using firm‐specific regressions, I show that earnings response coefficient differ across firms. However, there is no evidence of differential earnings response coefficient to a certain earnings announcement time. By switching to a different announcement time from its preferred time, a firm does not gain a softer market reaction. I compare research results from a firm‐specific method and from a pooled time‐series and cross‐sectional method and demonstrate that they differ significantly due to large heterogeneity across firms. I suggest that researchers should adopt a firm‐specific approach to avoid misleading results and to achieve improved estimations.     

The Psychological Contract in Employment in Vietnam: Preliminary Empirical Evidence from an Economy in Transition

The psychological contract is defined as a set of mutual and promissory obligations perceived by employees and employers in their employment relationship. Although this concept had been extensively researched in the West, little empirical evidence in other contexts was available. This study operationalized the concept of psychological contract in Vietnam, an economy in transition. From a sample of 220 questionnaires of employees and their corresponding human resource managers, it found some distinct features of the psychological contract. Furthermore, this articles confirmed the congruence in the perceptions of employees and employers about contract obligations and fulfilments.     

Assessing holiday satisfaction of Australian travellers in Vietnam: An application of the HOLSAT model

The hotel business model has been diversified in response to the various needs of consumers. Many previous studies focused on the alteration factors of the hotel business model from the consumer's point of view. Although it is one of the factors that affect alteration of the hotel business model, the manager's perspective is also an important alteration factor. This article emphasizes that it is necessary to consider not only the consumer side, but also the management side based on two approaches of the strategy theory: the positioning approach and the resource-based approach.

Surveys were conducted by mail in order to gather information regarding what managers in Japan consider to be important components of a hotel. As a result, “location” was found to be the most important component, followed by “annex facilities” and “deployment system”. Once the components were ordered according to their relative importance, a strong relationship was found between the managers' preferences and the characteristics of “syukuhakusyutai-type” hotels, which are ‘direct management’ (DM) hotels located usually in the city. In Japan, the number of “syukuhakusyutai-type” hotels has recently increased, therefore capturing the spotlight in the hotel industry. However, the results of this research are not compared with those of much previous research conducted on hotel choice attributes, because the measured variables differed significantly.     

Intermediate levels of property rights and the emerging housing market in Ho Chi Minh City,Vietnam

Vietnam introduced a Policy of Renovation (‘Doi Moi’ Policy) to restructure the economy in 1986. Under this policy, the Land Use Right Certificate was introduced as a form of tenure for agricultural land and urban land, according to the Land Laws of 1987 and 1993, respectively. However, by 2001, most properties and/or land in Vietnam still did not have a legal title. Although Vietnam's land reforms in the 1990s provided some of the weakest private rights among the transition countries, big cities like Ho Chi Minh City are presently homes to thriving housing markets. Transactions of ‘property without a physical entity and legal title’ in the real estate market show how property ownership can be formed in order to operate within different institutional contexts. This paper highlights that ‘intermediate levels of property rights’ are the driving forces behind the thriving housing market in Ho Chi Minh City.