Dynamic adjustment of container stacking policy in an automated container terminal

The decision for good stacking positions for incoming containers in an automated container terminal is an important operational problem because it affects the productivity not only for stacking but also for later retrieval. This paper proposes an online search algorithm which dynamically adjusts and optimizes a stacking policy by continuously generating variants of stacking policies and evaluating them while they are actually being applied for determining the stacking positions. Simulation experiments show that the proposed algorithm is effective in enhancing the operational productivity, while other offline optimization methods are computationally infeasible to be applied to this problem.     

Technical trading rules for nonlinear dynamics of stock returns: evidence from the G-7 stock markets

This paper explores a possible link between an asymmetric dynamic process of stock returns and profitable technical trading rules. Using the G-7 stock market indexes, we show that the dynamic process of daily index returns is better characterized by nonlinearity arising from an asymmetric reverting property. The asymmetric reverting property of stock returns is exploitable in generating profitable buy and sells signals for technical trading strategies. The bootstrap analysis shows that not all nonlinearities generate profitable buy and sell signals, but rather only the nonlinearities generating a consistent asymmetrical pattern of return dynamics can be exploitable for the profitability of the trading rules. The significant positive (negative) returns from buy (sell) signals are a consequence of trading rules that exploit the asymmetric nonlinear dynamics of the stock returns that revolve around positive (negative) unconditional mean returns under prior positive (negative) return patterns. Our results corroborate the arguments for the usefulness of technical trading strategies in stock market investments.     

Japanese Foreign Direct Investment in Electrical Machinery and Appliances in the United States: A Combined Industrial Organization and Location Theory Approach

We analyse the effects of both ownership and location advantages on the size of foreign direct investment, by combining industrial organization and location theory approaches. The estimated results employing a truncated distribution model show that the parent company's managerial resources and the external economies in a located region between them determine the FDI size of Japanese electrical machinery and appliances firms. This result suggests that empirical studies, applying only the industrial organization theory approach, need to be complemented by the location theory approach.     

The disposition effect and investment performance in the futures market

This study examines whether the disposition effect (DE), i.e., the tendency of investors to ride losses and realize gains, exists in the Korean stock index futures market. Using a unique database, we find strong evidence for the DE and explain this in terms of investor characteristics. We also investigate the effect that the disposition bias has on investment performance. There are four main findings. First, individual investors are much more susceptible to the DE than institutional and foreign investors. Second, sophistication and trading experience tend to reduce the DE. Third, the DE is stronger in long positions than in short positions. Finally, there is a negative relationship between the DE and investment performance. This result is consistent with Odean (1998, Journal of Finance, 53, 1775–1798), but contrasts with Locke and Mann (2005, Journal of Financial Economics, 76, 401–444) who find no evidence of any contemporaneous measurable costs associated with the DE. © 2009 Wiley Periodicals, Inc. Jrl Fut Mark 29:496–522, 2009     

The substitution effects of short-term debt for long-term debt on the expected returns of common stocks

The determination of the level of corporate borrowing and the choice of debt maturity are the two most important concerns in the management of capital structure. In this study, we examine analytically and empirically the impact of debt maturity changes on the expected returns of common stocks. Using the US stock market data and financial statement data, we examine the cross-sectional relation between expected returns and financial leverage ratios. We find reliable evidence that common stock expected returns are positively related to the extent of short-term debt financing. The positive relation is significant even after we control for systematic risk, total debt ratio and firm size. The results suggest that an increase in short-term debt which displaces the same amount of long-term debt increases the expected returns of common stocks, possibly because the substitution transfers risk from long-term debtholders to shareholders.The author is from the Department of Business Administration, Han Sung University, Seoul, Korea. This paper is based on my dissertation submitted to the School of Management, SUNY at Buffalo (1991). I would like to thank my dissertation committee, Dosoung Choi, Frank Jen and Michael Rozeff, for their invaluable comments throughout the dissertation research.     

Earnings Management Surrounding CEO Turnover: Evidence from Korea

This article examines the empirical relation between chief executive officer (CEO) turnover and earnings management in Korea using a sample of 403 CEO turnovers and 806 non‐turnover control firms during the period 2001–2010. We classify CEO turnovers into four types depending on whether the departure of the outgoing CEO is peaceful or forced and whether the incoming CEO is promoted from within or recruited from outside the firm. We measure earnings management by both discretionary accruals and real activities management. We also control for the endogeneity of CEO turnover and a potential selection bias using 2SLS and Heckman's two‐stage approach. After controlling for corporate financial performance and governance structure, we find upward earnings management by the departing CEO only when the departure is forced and the new CEO is an insider. In this case, the new CEO also engages in downward earnings management using both discretionary accruals and real activities management. We also find some evidence that the new CEO recruited from outside the firm manages discretionary accruals upward following the peaceful departure of his predecessor. In all other types of CEO turnover, we do not find evidence of significant earnings management by either CEO.     

Rugby Union among middle-aged American men: an exploration

Although rugby union, a full-contact sport, is usually considered as a leisure activity in the domain of young people, the motivations and effects of rugby union played by middle-aged men are not clear. The purpose of this study is to examine the motivations and participation effects of middle-aged American men participating in rugby in the USA. This study concentrates on rugby union (hereinafter referred to as rugby) as opposed to rugby league. Data were collected through in-depth interviews during an international amateur masters’ tournament. A total of 14 amateur rugby players with ages ranging from 35 to 52 were interviewed. This study found that the motivations for rugby participation were making friends, the love of rugby and self-actualisation. The participation effects of rugby were a long-term commitment, skill improvement and cultural awareness. Moreover, these findings on the motivations and effects of rugby help support the conclusion that this sport among the middle-aged group can be considered as a serious leisure activity.     

Diversification discount,information rents,and internal capital markets

While many existing studies report that corporate diversification destroys shareholder value, several recent studies challenge these findings. Schoar [Schoar, A. (2002). Effects of corporate diversification on productivity. The Journal of Finance, 57, 2379?2403] finds that plants in conglomerates are more productive than those in comparable single-segment firms, although conglomerates are traded at discounts. Villalonga [Villalonga, B. (2004a). Diversification discount or premium? New evidence from the business information tracking services. The Journal of Finance, 59, 479–506; Villalonga, B. (2004b). Does diversification cause the “diversification discount”. Financial Management, 33, 5?27] employs a more comprehensive database and statistical techniques than those used in the prior studies, and shows that there is a diversification premium, rather than discount. This paper develops a model that highlights the costs and benefits of corporate diversification. The diversified firm trades off the benefits of more efficient resource allocation through its internal capital market against the costs of information rents to division managers, which are necessary for effective workings of the internal capital market. We provide an argument supporting Schoar's findings, and identify conditions under which there can be a diversification discount or a premium.     

Leverage, volatility and executive stock options

This paper studies how an optimal wage contract can be implemented using stock options, and derives the properties of the optimal contract with stock options. Specifically, we show how the exercise price and the size of the option grant should change in response to changes in exogenous parameters. First, for a fixed exercise price of executive stock options, the size of the option grant decreases in the riskiness of a desired investment policy, decreases in the volatility of return from the risky project, and increases in leverage. Second, for a fixed size of the option grant, the optimal exercise price of managerial stock options increases in the riskiness of a desired investment policy, increases in the volatility of return from the risky project, and decreases in leverage. Several empirical predictions are drawn from these conclusions regarding the pay-performance sensitivity of management compensation.     

Duration of disability,job mismatch and employment outcomes

Workers with disabilities have functional limitations that affect their productivity in some, but not necessarily all, jobs. Workers who find a job that is a good match for their functional limitations (i.e. a job where their limitations have little or no impact on important job functions) should expect better employment outcomes (e.g. higher wages, longer job tenure) than workers with similar disabilities who are mismatched in their jobs. Merging data from the Survey of Income and Program Participation with O*Net data on job demands, we construct two continuous measures of job mismatch for workers with physical disabilities. We then extend the literature on disability and employment by exploring relationships between duration of disability, job mismatch, wages and hours worked. The results indicate that workers with long durations of disability are employed in jobs that are a better match to their physical limitations than are similar workers with shorter durations of disability. And, workers who are mismatched earn lower wages and work fewer hours than their counterparts whose jobs are a better match. Overall, the findings suggest that disability employment policies should include systematic efforts to help workers with disabilities find good job matches.