Social Capital or Ethnic Enclave Location? A Multilevel Explanation of Immigrant Business Growth

The rapid increase in migration into host countries and the growth of immigrant‐owned business enterprises has revitalized research on ethnic business. Does micro (individual)‐level social capital, or meso (group)‐level location within the ethnic enclave lead to immigrant business growth? Or do you need both? We analyze quantitative data collected from 110 Chinese restaurants in Australia, a major host country. At the micro level we find that coethnic (same ethnic group) networks are critical to the growth of an immigrant entrepreneur's business, particularly in the early years. But non‐coethnic (different ethnic group) social capital only has a positive impact on business growth for immigrant businesses outside the ethnic enclave. Our findings are relevant, not only to host‐country policymakers, but also for future immigrant business owners and ethnic community leaders trying to better understand how to promote healthy communities and sustainable economic growth. © 2015 Wiley Periodicals, Inc.     

Consumption and exchange rate uncertainty: Evidence from selected Asian countries

We set out to assess the effects of exchange rate uncertainty on real consumption in selected Asian countries. Consumption influences business cycles, which in turn shape short-run monetary policy decisions. Hence, understanding factors driving consumption is appealing to policymakers. To date, few studies have analysed the effects of uncertainty on consumption. The available ones generally focus on the long-run effects, in spite of the fact that the short-run persistence and adjustments to equilibrium are equally relevant. Our study takes these limitations seriously by distinguishing the short- and long-run effects of exchange rate uncertainty on consumption. Using a flexible dynamic panel data technique that allows long-run effects to be homogeneous and the short-run effects to be heterogeneous, we find that uncertainty impedes consumption in the long run. In the short run, however, the effects are immaterial. This evidence remains robust to the measure of uncertainty, asymmetric uncertainty, inflation and the global financial crisis of 2008. By decomposing uncertainty into its temporary and permanent components, we find that the latter have a stronger effect on consumption in the long run than the former. Although both components demand policy attention, the evidence suggests that policymakers should be more concerned with permanent uncertainty.     

Daily outfit satisfaction: the effects of self and others' evaluation on satisfaction with what I wear today

This study investigated the satisfaction of the outfit which an individual chose to wear for the day by examining how self and others' evaluations influenced the outfit satisfaction and the intention to re‐wear. In addition, moderator variables (body satisfaction and body surveillance) that affected the effect of the evaluative factors upon satisfaction and behavioural intention were also examined. An online‐survey was conducted and the sample size used in the analysis was 349 in total. Using SPSS 18.0 and AMOS 18.0, structural equation modeling analysis and one‐way analysis of variance were implemented for hypothesis testing. The results showed that self‐evaluation as a perception of appropriateness of the outfit for that day and others' positive feedback increases outfit satisfaction. Appropriateness perception also had a significant impact on the intention to re‐wear. However, feedback from others on one's outfit did not have a significant direct effect on behavioural intention. Three‐way ANOVA was performed to verify the impact the feedback from others, body satisfaction, and body surveillance had on the respondent's intention to re‐wear, and a three‐way interaction effect was statistically significant. While individuals with high body satisfaction were likely to be confident about their appearance overall, the feedback from others did not impact their satisfaction. Individuals with low body satisfaction were influenced by others' feedback on their outfit. Individuals with high levels of body surveillance who sensitively monitored others' feedback especially displayed decreased intention to re‐wear when feedback from others on their outfit was negative. This research contributed to the deeper understanding of consumer's clothing behaviour at the post‐purchase stage. Enhanced understanding of lasting satisfaction and benefits pursued throughout the time while using the product would be essential in developing consumer‐centric marketing strategies.     

ASYMPTOTICS OF IMPLIED VOLATILITY IN LOCAL VOLATILITY MODELS

Using an expansion of the transition density function of a one‐dimensional time inhomogeneous diffusion, we obtain the first‐ and second‐order terms in the short time asymptotics of European call option prices. The method described can be generalized to any order. We then use these option prices approximations to calculate the first‐ and second‐order deviation of the implied volatility from its leading value and obtain approximations which we numerically demonstrate to be highly accurate.     

Financial Sector Volatility,Banking Market Structure and Exports

This paper assesses the impacts of financial sector volatility and banking market structure on industrial exports. By utilising the specification of Rajan and Zingales (American Economic Review 1998; 88 , 559) on the cross‐country, cross‐industry data from Manova (Journal of International Economics 2008; 76 , 33), we find that financial sector volatility, measured as the standard deviation of the growth of private credit, and banking market structure, measured as the share of the three largest banks’ assets in a country, respectively exert significantly negative and positive impacts on industrial exports, particularly for those industries that are more externally financially dependent. The findings are robust to a variety of kinds of sensitivity analysis and thus lend support to the notion that a more stable and concentrated banking system is important to the exports of those industries that rely more on external finance.     

Experiments on strategic choices and markets

Much of experimental research in marketing has focused on individual choices. Yet in many contexts, the outcomes of one’s choices depend on the choices of others. Furthermore, the results obtained in individual decision making context may not be applicable to these strategic choices. In this paper, we discuss three avenues for further advancing our understanding of strategic choices. First, there is a need to develop theories about how people learn to play strategic games. Second, there is an opportunity to enrich standard economic models of strategic behavior by allowing for different types of bounded rationality and by relaxing assumptions about utility formulation. These new models can help us to more accurately predict strategic choices. Finally, future research can improve marketing practice by designing better mechanisms and validating them using experiments.     

From Voids to Sophistication: Institutional Environment and MNC CSR Crisis in Emerging Markets

Why do multinational corporations (MNCs) frequently encounter corporate social responsibility (CSR) crises in leading emerging markets in the new century? Existing research about institutional impacts on MNC CSR has developed a void-based account about how the flawed institutional system allows misdeeds to happen. But the fact that such misdeeds have turned into increasing CSR crises in the new century along with institutional change is rarely taken into account. This paper combines studies of institutional voids, institutional entrepreneurship, and stakeholder theory to develop a concept of institutional sophistication, which refers to both the top-down maturation of the regulatory system that standardizes firm behavior and the bottom-up diversification and intensification of grassroots initiatives that redefine stakeholder membership. Based on this concept, we developed a framework to comprehensively demonstrate how both institutional voids and sophistication drive the MNC CSR crisis in leading emerging markets. Empirically, we established an original database that includes 309 publicized CSR crises encountered by major foreign MNCs in China, India, and Russia, 2000–2011. Through a content analysis, the paper reveals six common sophistication processes that drive the MNC crisis across contexts and also specifies stakeholder strategies that make these processes happen and vary by social problems and national contexts. We also discussed the value of studying corporate social irresponsible behavior in understanding the institution–MNC relationship.     

Should sequels differ from original movies in pre-launch advertising schedule? Lessons from consumers' online search activity

Sequels have become a profitable strategy in the U.S. motion picture industry because of their strong name recognition. However, while the established positioning of a sequel may help insulate it from competing firms' advertising messages, its familiarity may cause moviegoers to be more easily satiated with advertising from the sequel. Therefore, this study examines how sequels differ from original concept movies in terms of their ad effectiveness. We focus our analysis on pre-launch periods, given these periods' importance in shaping the financial outcomes of motion pictures. We consider the weekly online search volume of a movie as a measure of consumer interest in it, and thus as an intermediate response to pre-launch advertising. We then develop a model that assumes ad effectiveness can decline, due to copy and repetition wearout, and increase, due to forgetting, over time. We find that copy wearout is greater for original movies, while repetition wearout and forgetting are greater for sequels. These findings suggest that sequels should allocate more in early pre-launch periods and less immediately before release, relative to originals, to maximize pre-launch consumer interest.