Do Lenders Value Corporate Social Responsibility? Evidence from China

Drawing on risk mitigation theory, this article examines whether the improvement of firms’ social performance reduces debt financing costs (CDFs) in China, the world’s largest emerging market. Employing both the ordinary least square (OLS) and the two-stage instrumental variable regression methods, we find that improved corporate social responsibility (CSR) reduces the CDF when firms’ CSR investment is lower than an optimal level; however, this relationship is reversed after the CSR investment exceeds the optimal level. Firms with extremely low or extremely high CSR are subject to a higher CDF. The results also suggest that the optimal CSR level for small firms is higher than that for large firms. This study is the first to document a U-shaped relationship between CSR and CDF and also the first to investigate this relationship within an emerging market context.     

Do Young Children Understand the Selling Intent of Commercials?

An important question for marketers, educators, government regulators, and parents is whether young children understand the selling intent of television commercials. In a replication of an approach used by Donohue, Henke, and Donohue [6], preschoolers appeared competent in their understanding by selecting a photograph illustrating a purchase behavior. In an extension that included additional nonverbal measures, young children indicated little understanding, however, of the selling intent of commercials. Researchers interested in advertising effects on children are urged to consider the necessity and desirability of improved nonverbal measures in dealing with a subject population with limited language facility.     

How Wisely Do Consumers Select Their Property and Liability Insurance Coverages?

Responses from a consumer panel in South Carolina were used to evaluate consumers' selections of homeowner's and auto insurance coverages. The results indicate that many consumers violate accepted decision rules for selecting coverages. Liability limits typically were below usually recommended levels, while most respondents had selected only small deductibles. Responses also indicated that a major portion of the respondents had not been provided information by their agents to assist them in the selection of coverage. Respondents who reported they had received information from their agents typically had made more appropriate selections than those who had not.     

Can China's Life Insurance Obtain Technology by Opening Its Market?

Atthebeginningofthe21stCentury,facingthereadiustmentandrestructuringoftheinternationalfinancialbusiness,China'sfinancialmarketsarealsoundergoingreadjustments.Aimedatlinkingthemselveswiththeinternationalcommunity,China'ssecuritiesmarketsandcommercialbankshaveinitiatedstrategicreadjustments.Butasakeypartintheinsurancebusiness,China'slifeinsurancehasnodevelopmentinitsreadustment.Ineary2000,thePacificInsuranceCo.Ltd.declaredthatitwouldcooperatewithforeignpaftnersinitslife-insurancebusiness.But…     

Standardising Electronic Means of Payment?

In this paper it is discussed whether electronic means of payments should be standardised. Having answered this question affirmatively, it is analysed which form of standardisation will be appropriate. Three forms are discussed: Standardisation by market forces, by co-operations among firms and by state intervention. The result is that it is possible to solve the standardisation problem with co-operative firms or market forces. The question is, however, whether these solutions are compatible with a competitive market. State intervention in the form of prescribing basic technical standards and enforcing interconnection might be required to ensure the efficiency of the EPS market. A state monopoly with electronic money is not appropriate because it tends to be dynamically inefficient and to have problems with cost control.     

Selling to the urban Chinese in East Asia: Do CSR and value orientation matter?

Most multinationals have a presence in the East Asian region and target the urban Chinese population. In an effort to win over the loyalty of consumers, Corporate Social Responsibility (CSR) has been used increasingly as a marketing strategy. This paper explores how personal values influence the attitude and behavior towards CSR among Chinese consumers. By collecting data from three major East Asian cities — Hong Kong, Shanghai and Singapore, and employing factor, cluster, conjoint and correspondence analyses, the authors demonstrate that Confucian value orientation can be a powerful antecedent of CSR support.     

Perceived Ethicality of Insurance Claim Fraud: Do Higher Deductibles Lead to Lower Ethical Standards?

Insurance claim fraud costs insurance companies, policymakers, and taxpayers billions of dollars every year and has been described as the second largest white collar crime. The most common insurance fraud activity and one that contributes a significant portion of dollar losses is the practice of padding claim amounts in the event of a loss. One of the largest issues insurance companies face is that policyholders often do not perceive insurance claim padding as an unethical behavior. However, very little research has examined the factors that contribute to such perceptions. Considering how consumers often attempt to justify fraudulent behavior from a fairness perspective, the present work examines how the amount of the deductible in an insurance claim situation can influence feelings of fairness and ethicality. The results of an experimental study show that higher deductible amounts result in stronger perceptions that insurance claim padding is fair to the insurance company, weaker perceptions that the behavior is unethical, and higher proposed claim award amounts. The study also shows, however, that the deductible amount effects are attenuated for consumers who display higher ethical standards as reflected by their scores on the consumer ethics scale. Implications are discussed with respect to the insurance industry, deviant consumer behavior, and general business ethics theory.     

Commercial Insurance of Financial Disclosure: Auditors’ Independence, and Investors’ Protection

In this paper the authors propose, for preliminary consideration and discussion, a system of commercial insurance of financial disclosures (CIFD), under which users of financial information (owners and potential owners of business enterprises) and providers of financial information (managers of business enterprises) would be able to purchase insurance policies from private insurers (commercial insurance companies). These insurance policies would be designed to protect users of financial statements from specific, well-defined losses directly attributable to their use of financial disclosures that failed to conform to contractually defined standards. To reduce their own risks insurance companies will likely purchase from assurance experts (certified public accountants, financial analysts, and management consultants) services assuring adherence to standards. The paper discusses the dynamics of the decisions and negotiations within and among groups of investors, managers, insurers, assurors, and government regulators. The advantages of CIFD over current US regulation of financial disclosure are analyzed. Those advantages, which include increases in the independence of external auditors, improvements in the quality of their audits, and better protection for investors, are assessed. It is argued that CIFD may be capable of evolving into a very flexible system that would accommodate alternative regulatory structures.     

Personal Selling in Retail Settings: How Does the Internet and Related Technologies Enable and Limit Successful Selling?

Despite the proliferation of Internet usage both by retailers and by retail customers, little is know about the impact of the Internet on the retail salesperson's ability to add value to customer encounters. This article identifies and discusses Internet-related factors that potentially enable and/or limit the salesperson's successful execution of the personal selling process and also considers the effects of limitations of Internet retailing on achievement of desired retailer performance. Research questions are identified as a foundation for future work in the area.     

Do young firms owned by recent immigrants outperform other young firms?

This study compares the performance of new businesses owned by recent immigrants with that of other new firms. It addresses an on-going unresolved discussion in the academic and professional literatures by drawing on a large sample of Canadian business owners whose firms began trading between 2000 and 2004 and using taxation data to track 2004 to 2008 performance. The results provide empirical evidence that young immigrant-owned exporter firms outperformed young domestically-founded firms whether or not they exported; however, immigrant-owned young enterprises that did not export underperformed other young firms. Owner-level factors such as gender, growth intentions and experience also influenced growth performance among young SMEs. The results provide evidence that suggests that immigrants have resources such as access to international networks that provide competitive advantage over non-immigrant owners that export or aspire to export. Not all immigrant business owners, however, are able to lever such advantages. The implications of the findings for research and policy are discussed.     

Do cross-border acquisitions create value? Evidence from overseas acquisitions by Chinese firms

Based on the dynamic capability and organizational learning perspectives, we examine whether acquirers from emerging economies can create value for their shareholders in cross-border mergers and acquisitions, and the key drivers which may influence any such value creation. A sample of 367 cross-border mergers and acquisitions between 2000 and 2011 involving Chinese listed companies as the acquirers was analyzed to highlight the relationship between the cultural distance involved and the acquirers’ market valuation. On average, such cross-border transactions created value for the acquirer's shareholders, but cultural distance was negatively related to the extent of such value creation. Larger firms, more experienced firms, and acquisitions within the same industry were found to be less affected by cultural distance, emphasizing the importance of learning and absorptive capability, but employing a financial advisor did not seem to help. Thus firms with greater absorptive capacity were found better able to overcome the difficulties caused by cultural differences. Implications for research and practice are discussed.     

Do Unfair Procedures Predict Employees’ Ethical Behavior by Deactivating Formal Regulations?

The purpose of this study was to extend the knowledge about why procedural justice (PJ) has behavioral implications within organizations. Since prior studies show that PJ leads to legitimacy, the author suggests that, when formal regulations are unfairly implemented, they lose their validity or efficacy (becoming deactivated even if they are formally still in force). This “rule deactivation,” in turn, leads to two proposed destructive work behaviors, namely, workplace deviance and decreased citizenship behaviors (OCBs). The results support this mediating role of RD, thus suggesting that it forms part of the generative mechanism through which unfair procedures influence (un)ethical behavior within organizations. The author ends the article by discussing behavioral ethics and managerial implications as well as suggestions for future research.     

How Do Salespeople Make Decisions? The Role of Emotions and Deliberation on Adaptive Selling,and the Moderating Role of Intuition

This research explores how salespeople make decisions and what factors influence these decisions. Research in psychology suggests that, in making decisions, people use both intuition and deliberation, often relying on some degree of both processes. This study examines the impact of emotion, intuition, and deliberation on a salesperson's adaptability and resulting performance. Intuition is found to play a significant moderating role in the relationships between both deliberation and regulation of emotions on adaptive selling. However, as anticipated, the role of this moderation variable differs for each of these relationships. Findings suggest that intuition provides an important input to deliberative and emotive thought processes, and plays an important role in salesperson adaptiveness. Implications for salesperson mentoring and training programs are explored.     

How Well Do Owner–Managers Forecast Potential Future Bankruptcy? Assessing Fear of Failure Using Employment Insurance for SMEs

The literature so far has not addressed how owner–managers deal with the risks associated with potential future bankruptcy. We propose here a new way to assess the fear of failure experienced by SME owner–managers and examine whether these risks are being anticipated accurately, by focusing on the benefits to be gained from French unemployment insurance. We compare the valuation of the benefits of the unemployment insurance scheme for the two populations of insured and uninsured owner–managers after matching. We rely on matching procedures and a five‐step protocol. Our results show that owner–managers' awareness of possible future problems increases when becoming insured and after experiencing a failure, suggesting some business failure myopia in this population. Copyright © 2018 ASAC. Published by John Wiley & Sons, Ltd.     

China Actively Pushes Forward the Reform in the Use of National Land Resources by Payment

According to Tian Fengshan, Minister of National Land Resources. Last year China actively pushed forward the policy reform in the use of national land resources by payment, and the building-up of the market for great progress had been made in. In the ministerial meeting of national resources offices, Tian Fengshan pointed out that at present, bids and auctions for the use     

Does Payment For Order Flow To Your Broker Help Or Hurt You?

The presumption is that a broker executing a stock trade for a retail investor will get the investor the best possible price execution for the transaction. In fact, the broker often sells the retail investor’s trade to an intermediary for cash payment. The broker’s motivation to generate dealer profits seems to overcome the broker’s fiduciary responsibility to obtain the best execution price for the customer, raising ethical questions. Purchasers and internalizers of order flow in the market may cause prices quoted on the NYSE to deteriorate, making all investors worse off. University of Notre Dame Finance Professor Robert Battalio received a Bachelor of Science from Texas A&M University and a Ph.D. from the Indiana University. University of Notre Dame Finance Professor Tim Loughran received a Bachelor of Arts and a Bachelor of Science from the University of Illinois (Urbana), an MBA from Indiana University, and a Ph.D. from the University of Illinois (Urbana).     

Declining Protection in Developing Countries: Fact or Fiction?

This paper explores whether and to what extent evident trade reform, falling average tariffs and rising exports in recent decades overstate the extent to which protectionism has declined in developing countries, especially low‐income developing countries. It identifies remaining significant protection, especially of final manufactured goods; this being associated with the presence of peak tariffs, escalating tariff structures by stage of production and replacement of old forms of non‐tariff protection with new instruments of non‐tariff protection. It also identifies significant protection arising from high international trade costs induced by inefficiencies in transportation, ports and customs, and from the growth of exports to preference‐receiving, export markets.     

Donors’ Mechanisms for Financing International and National Public Goods: Loans or Grants?

This paper investigates whether three classes of donors – multilateral organisations, regional institutions and bilateral donors – tailor their mix of grants and loans to reflect international benefit spillovers and recipient‐specific benefits, derived from aid‐funded activities in developing and transition countries. To account for recipient benefit shares, donors should use a greater share of grants when supported activities yield a larger portion of international public benefits. A greater reliance on loans is appropriate when a large portion of recipient‐specific benefits are associated with the assistance. By reflecting recipient benefit shares in the grant‐loan mix, donors’ assistance also promotes allocative efficiency. Using the Credit Reporting System (CRS) database from OECD for 1980–2000, our analysis establishes that various donor classes apply different grant‐loan mixtures when supporting the environment, health, knowledge and governance sectors of recipient countries. We employ analysis of variance and other statistical comparisons of the means to investigate differences among donor classes. We demonstrate that bilateral donors do the best job in tailoring their grant‐loan mix to accord with the extent of international public good benefits embodied in the aid‐supported activity. Multilateral organisations’ grant‐loan mix is intermediate of the three types of donors, with some evidence of them relying more on grants to finance activities that possess a larger share of international public good spillovers. Regional institutions, however, do not discriminate their grant‐loan mix by either sectors or the associated public good spillovers. This finding suggests that regional development banks need to adjust their grant‐loan mix to better account for international benefit spillovers if these institutions are to warrant the increased funds to underwrite regional public goods that they have been seeking. If, however, their mix is institutionally set, then the stakeholders must give these institutions greater flexibility to tailor their grants and loans to who benefits from the aid‐supported public goods. This is the first paper to empirically ascertain whether the grant‐loan mix is tied to the inherent publicness of the aid‐funded activities.