Young Americans' ethnic identity toward disaster advertising: The effects of disaster location and message types

The purpose of this study is to examine young American donors' perspectives toward disaster ad messages. Attitude toward helping others, social responsibility, ethnic identity on donation behavior, attitude toward ad, and advertising effectiveness were examined using 2 experimental variables (disaster location and message types). The findings explain that the constructs are positively related to each other and the 2 experimental variables significantly influence young Americans' attitudes toward ads and advertising effectiveness. In addition, young Americans expressed stronger feelings concerning attitude toward charity ads, and a higher level of advertising effectiveness was demonstrated when the disaster occurred domestically. Further, emotional messages were considered more persuasive than factual messages. As managerial suggestions, when charities work for domestic disasters, emphasizing patriotism and an emotional message can increase the positive attitude toward ads and advertising effectiveness. On the contrary, when charities work for international disasters, the messages should focus on diminishing distinctions between in‐group and out‐group perceptions.     

CEO career horizon,corporate governance,and real options: The role of economic short‐termism

Research Summary: Combining studies on real options theory and economic short‐termism, we propose that, depending on CEOs’ career horizons, CEOs have heterogeneous interests in strategic flexibility, and thus, have different incentives to make real options investments. We argue that compared to CEOs with longer career horizons, CEOs with shorter career horizons will be less inclined to make real options investments because they may not fully reap the rewards during their tenure. In addition, we argue that long‐term incentives and institutional ownership will mitigate the relationship between CEOs’ career horizons and real options investments. U.S. public firms as an empirical setting produced consistent evidence for our predictions. Our study is the first to theoretically explain and empirically show that a CEO's self‐seeking behavior will impact real options investments. Managerial Summary: This article helps to explain how a CEO's self seeking‐behavior may shape a firm's real option investment, which could result in different level of strategic flexibility. We argue that CEOs with short career horizons have less time to exercise their firms’ real options, which should lower the investments in the firms’ real options portfolios relative to CEOs with long career horizons. We study a sample of U.S. public firms and find strong evidence that a CEO's expected tenure in the firm is positively related to the real options investments at the firm level. We find that this agency issue can be mitigated by adopting appropriate corporate governance mechanisms such as long‐term incentives and institutional investors.     

Does local political support influence financial markets? A study on the impact of job approval ratings of political representatives on local stock returns

Using data on job approval ratings of governors, U.S. senators, and the president, we find that firms located in states with high approval ratings outperform firms located in states with low approval ratings by .64% per month. Furthermore, this relationship is stronger when investors are actively involved in politics, when local politicians are closer to the center of political power, for small firms that have a larger proportion of local investors, and for financially strong areas where investors are ready to execute investments in local stocks. Overall, our study shows that investors’ political sentiment is important in determining stock returns.     

The Effect of Litigation Risk Increase on Big N Auditor Exits and Audit Quality in the Korean Savings Banking Industry

This study investigates whether an increase in litigation risk results in Big N auditors leaving the industry and examines the impact of this increase on audit quality. Using a sample of Korean savings banks from 2009 to 2015, the study finds that the proportion of Big N auditors sharply decreases after a savings bank crisis, suggesting that Big N auditors are likely to reject riskier clients, while audit quality is unchanged. The results provide new evidence that an increase in litigation risk does not necessarily increase audit quality. The findings have academic and practical implications, as they suggest that policies for improving audit quality should consider auditors’ strategies in response to litigation risk.     

Does Institutional Blockholder Short‐Termism Lead to Managerial Myopia? Evidence from Income Smoothing

We examine institutional blockholders’ influence on income‐smoothing practices in the Korean market, which provides an interesting setting where family‐oriented chaebols dictate the corporate landscape and impede shareholder activism. The empirical results reveal that institutional shareholders with a short‐term (long‐term) investment horizon facilitate (constrain) managerial myopia. This positive (negative) association is most evident among firms with domestic institutional investors. Therefore, we argue that the presence of domestic institutional investors with transient investment goals incentivizes firms’ management to smooth out earnings.     

The equivalence of supporting software delegation and sales delegation

This paper considers a duopoly market with horizontally differentiated system goods to examine system owners' behaviors under supporting software delegation, in which owners of system firms use varieties of supporting software, coupled with profit, to evaluate their managers' performance. Supporting software delegation seems to induce managers to act more aggressively in price competition than sales delegation does; however, we prove that if two systems are compatible and the varieties of supporting software are determined by hardware owners' overall expenditure amount on software, then supporting software delegation is equivalent to sales delegation. Owners of system firms induce their managers to act less aggressively in hardware price competition by offering contracts with a negative weight on varieties of supporting software under supporting software delegation. We find that stronger network externalities do not reverse system owners' contracting behaviors under supporting software delegation. Finally, it is worth mentioning that hardware technologies are static in this paper. In other words, dynamic changes such as hardware evolution are not considered in our analysis.     

Tourists’ happiness: are there smart tourism technology effects?

The purpose of this study is to develop a research model demonstrating tourists’ value-seeking processes through the tourism services and travel experiences of a destination. The model suggests that tourist happiness is assessed by tourists’ perceived experiences, which are formed by two motivational values: smart tourism technology (STT) and destination value. Despite a large quantity of research attention on destination tourism, the relation between tourists’ destination experience and STT has been less enthusiastically studied. Therefore, this study proposes to test an integrated model with attributes of STTs and destination values that contribute to tourists’ life happiness. The results of this study, from a survey of 191 foreign tourists in Seoul, South Korea, indicate that tourists are likely to put more value on what they perceived from their destination travel experiences than what they perceived from their experiences with STT services when they evaluate their overall happiness. Theoretical and practical implications are discussed.     

The State as Both Regulator and Player: The Politics of Transfer of Development Rights in China

The conventional argument that the introduction of transfer of development rights (TDR) shifts the power of land use regulation from the state to the market is increasingly under challenge. In China, the state's grip on land is reinforced through TDR, in which the state is both regulator and player. This state-dominated form of TDR affects China in three ways. First, competing aspirations of different scales of government complicate how TDR is implemented. Although the central state promotes TDR to maintain a national balance of arable land, some local states instrumentalize it to expand their landed basis of accumulation. Secondly, TDR tends to benefit the state but not its people. It may increase the fiscal income of the sending government and lessen the land shortage of the receiving government, but sometimes at the expense of the interests of land users without land ownership. Thirdly, given the state's deep involvement in TDR programs, the key for China's TDR to protect arable land lies not so much in clear property rights or a fully fledged market as in effective checks and balances regarding the state's powers over TDR. These three observations attest to the embeddedness of TDR in the local political economy.