Value network analysis for complex service systems: a case study on Taiwan’s mobile application services

Service Business - This paper aims to develop a service value network analysis approach based on system dynamics (SD) for analyzing the feedback structures that causes dynamic behavior of service...     

The Macroeconomic Effects of the Canada–US Free Trade Agreement on Canada: A Counterfactual Analysis

We evaluate the macroeconomic effects of the Canada–US Free Trade Agreement (FTA) on Canada's economy using a counterfactual analysis. We exploit the dependence of GDP growth (labour productivity and unemployment, respectively) among different economic entities and construct the counterfactuals using data from countries other than Canada. We find that in the adjustment period from 1989:Q1 to 1992:Q1, Canada's economy bore the short‐run adjustment costs of the FTA with a decline of the annual real GDP by 2.56 per cent and a decline of the labour productivity by 0.62 per cent. After the adjustment period, the FTA had a positive and permanent effect of 1.86 per cent on Canada's annual real GDP growth and raised the labour productivity from 1992 to 1994 by 2.39 per cent on average. Moreover, the FTA increased Canada's annual unemployment rate by 1.81 per cent in the period 1989–94.     

PTE,innovation capital and firm value interactions in the biotech medical industry

Unlike previous studies which only focus on the main effect between IC and FV, this research includes PTE with the gap of resource-based view. IC is a key element in creating a competitive advantage, as it has a great influence on FV. A company may put relatively less into IC if it demonstrates higher efficiency. However, previous studies have neglected the fact that relative efficiency and IC affect FV and stock returns directly and indirectly. The research period was from 2006 to 2010 and the main research methods include HRA and DEA. The main research findings include the following. (1) There is a space for improvement in terms of the total technical efficiency. (2) PTE has a significant moderating effect between IC and FV. (3) IC and PTE have a significant influence on FV. (4) Apart from PTE and stock returns, IC and FV show significant differences within the sub-industry.     

CEO Stock‐Based Incentive Compensation and Firm Performance: A Quantile Regression Approach

This study employs the quantile regression model to examine the non‐monotonic impact of CEO stock‐based compensation on firm performance, using the data for U.S. non‐financial firms from 1993 to 2005. The results indicate that while the impact of CEO stock‐based pay on firm performance is positive for firms in the higher earnings quantile levels, the impact is negative for firms in the lower levels. In addition, the “V‐shaped” relationship between CEO stock‐based pay and firm performance satisfactorily explains the longstanding disagreement among earlier studies with regard to whether CEO stock‐based pay can enhance firm performance. Furthermore, the quantile‐varying pattern of the impact of stock‐based compensation on firm performance is robust after controlling for the industrial and yearly effects. It is also robust to the use of the pay‐for‐performance sensitivity as an alternative explanatory variable or the market‐based measure of performance as the dependent variable, or the consideration of the suspected endogenous problem between firm performance and stock‐based compensation.     

Time pressure and creativity in industrial design

Creativity is a critical aspect of competitiveness in all trades and professions. In the case of designers, creativity is of the utmost importance. Based on the perspective of industrial design, the relationship between creativity and time pressure was investigated in this study using control and experimental groups. In the first part of the study, fuzzy theory, the Creative Product Analysis Matrix, the Analytic Hierarchy Process, and Consensus Assessment Techniques were integrated to establish a method to evaluate creativity in industrial design. Moreover, the experimental and control groups were compared using three tests: the Torrance Tests of Creative Thinking, the product concept development test, and the product aesthetic development test. Six hypotheses were examined. Based on an analysis of the results, suggestions are offered to improve creativity management. The suggestions can serve as reference for creativity management of individuals, groups and companies in order to make the concept generating process more efficient.     

Diagnostic Tests of Cross‐section Independence for Limited Dependent Variable Panel Data Models*

This article considers the problem of testing for cross‐section independence in limited dependent variable panel data models. It derives a Lagrangian multiplier (LM) test and shows that in terms of generalized residuals of Gourieroux et al. (1987) it reduces to the LM test of Breusch and Pagan (1980) . Because of the tendency of the LM test to over‐reject in panels with large N (cross‐section dimension), we also consider the application of the cross‐section dependence test (CD) proposed by Pesaran (2004) . In Monte Carlo experiments it emerges that for most combinations of N and T the CD test is correctly sized, whereas the validity of the LM test requires T (time series dimension) to be quite large relative to N. We illustrate the cross‐sectional independence tests with an application to a probit panel data model of roll‐call votes in the US Congress and find that the votes display a significant degree of cross‐section dependence.     

Modeling e-loyalty: a moderated-mediation model

ABSTRACT

This work proposes a research model that elaborates upon the development of e-loyalty based on the signaling theory and attachment theory. In the model, e-loyalty is indirectly related to both visual appeal and an e-tailer’s service reputation through the full mediation of trust and affection. At the same time, the relationships between trust and e-loyalty and between affection and e-loyalty are hypothetically moderated by an e-tailer’s service reputation. The proposed hypotheses of this research were empirically tested using data from working professionals in high-tech firms in terms of online retailing. This study surveyed the same research participants at two different time points, one month apart, to verify the theoretical inferences. The empirical findings herein complement the previous literature by presenting how visual appeal and an e-tailer’s service reputation simultaneously influence e-loyalty through various mediating and moderating mechanisms.     

Crises in Asia: Recovery and policy responses

The goal of this paper is to provide stylized facts on recovery from economic downturns and to evaluate the role of macroeconomic policies in promoting recovery. In particular, we examine gross domestic product (GDP) recessions and financial downturns (credit contractions and stock price declines) using data from 21 Organisation for Economic Co-operation and Development (OECD) economies and 21 developing Asian economies. We find, in general, recovery from a GDP recession in the Asian economies is somewhat slower than in the OECD economies. However, recovery from a financial downturn is not much different between Asia and the OECD. We also find the OECD economies have been more active and effective in using counter-cyclical policies than the Asian economies in the face of GDP recessions and financial downturns. Recent evidence, however, suggests the Asian economies may have better success in the current global crisis.     

A passenger demand model for air transportation in a hub-and-spoke network

This paper develops an air passenger model that deals with city-pair demand generation and demand assignment in a single framework. Using publicly available and regularly collected panel data, the model captures both time series and cross-sectional variation of air travel demand. The empirical analysis finds that pattern of correlations among alternatives can be described by a three-level nested logit model. Fare, frequency, flight time, direct routing, on-time performance, income, and market distance have significantly effects on air demand. Correcting for the problem of endogenous air fares using instrumental variables yields more plausible estimates of price sensitivity and value of time.     

The Diversification Effects of Initial Public Offerings

Abstract:  A firm's stock becomes publicly tradable through an initial public offering (IPO). This study suggests a portfolio diversification perspective to explore IPOs. We examine whether investors can gain diversification benefits by adding an IPO portfolio to a set of benchmark portfolios sorted by firm size and book-to-market ratio. Using US IPOs from 1980-2002, we find that adding a value-weighted IPO portfolio does lead to a statistically and economically significant enlargement of the investment opportunity set for investors relative to investing solely in a set of benchmark portfolios. Specifically, the Sharpe ratio of the tangency portfolio increases by 5.50% on average after including IPO stocks. Furthermore, IPOs associated with prestigious lead underwriters are the main source of this augmentation of the mean-variance investment opportunity set. Finally, our study implies that issuing IPO exchange traded funds or similar products can provide diversification gains to investors.