Understanding Firm, Physician and Consumer Choice Behavior in the Pharmaceutical Industry

This paper argues that the pharmaceutical industry represents an exciting opportunity to carry out academic research. The nature of the industry allows researchers to answer new questions, develop new methodologies for answering these questions as well as to apply existing methodology to new data. The paper opens with some industry background, then provides a brief overview of some important research areas and discusses the open questions in each area. Issues of data type and availability are also discussed. This paper is based on a session (with the same title and participants) that was part of the Sixth Invitational Choice Symposium hosted by the University of Colorado and held at Estes Park, Colorado during June 4–8, 2004.     

Enhancing bank performance through branches or representative offices? Evidence from European banks

We investigate the impact of geographic integration and the level of multinationality by expansion as a foreign branch or representative office on the parent bank performance of 45 European banks during 2000–2007. We use breadth and depth to proxy for the level of multinationality in measuring a parent bank performance. We find that for foreign expansion as a branch, both dimensions (breadth and depth) have a positive impact on a bank's return on assets (ROA). For return on equity (ROE) and Tobin's Q, only depth is positively associated with a bank's ROE while breadth is positively correlated with a bank's Tobin's Q. However, the impact from expansion as a representative office is different; breadth and depth only have a positive impact on bank ROA performance in one of the six models. In terms of cost control, a representative office strategy is better able to control costs than a branching strategy. The model goodness of fit statistics suggest that variables associated with branching better explain the performance variables than similar variables associated with representative offices in terms of profitability. The results are opposite for net interest margin and cost ratio. Overall, our findings suggest that a branching strategy is a more effective strategy in enhancing a bank's profitability while a representative office strategy controls costs better.     

Trading Mechanisms and Market Quality: Call Markets versus Continuous Auction Markets

On July 29, 2002, the trading mechanism in the Taiwan Futures Exchange (TAIFEX) was switched from an exclusive call market to a continuous auction market. Based upon several proxies of market quality, in the present study, we set out to empirically examine whether this switch has resulted in any significant improvement in market quality within the TAIFEX. We find that while the quoted spreads, effective spreads, and price volatility are all smaller in the continuous auction market, the call auction market exhibits greater market depth and smaller pricing errors; the latter is also found to be more effective in resolving the problem of information asymmetry. Overall, the results of the present study suggest that the choice between call and continuous auction trading mechanisms essentially involves trade‐offs between the bid‐ask spread, market depth, price volatility, information asymmetry costs, and price efficiency.     

The Economic Significance of the Cross-Sectional Autoregressive Model: Further Analysis

We reexamine whether investors can gain abnormal returns using the cross-sectional autoregressive model of stock returns. We find that the pattern of abnormal returns obtained is inconsistent over the time period 1934–94. We adjust for the higher commission costs in the pre-May 1 1975 period, a point overlooked in Jegadeesh (1990), by assuming a conservative one-way transaction cost of 0.75%. For the post-May 1 1975 period, we use a one-way transaction cost of 0.25%. The results show that investors who invest only on the long side would earn insignificant 'after-transaction cost' abnormal returns in the post-World War II period, 1946–94. The 'after-transaction cost' abnormal return from the short strategy is about 0.5% for the period 1946–94. This article shows that an investor would not earn abnormal returns using this model considering that it is more costly in practice to sell securities short and that most investors would not earn interest on short sale proceeds.     

Corporate Sustainable Development and Marketing Communications on Social Media: Fortune 500 Enterprises

This study proposes a measurement to evaluate corporate sustainability marketing communications on social media implemented by Fortune 500 enterprises. The results reveal significant differences between sustainability marketing communications in blogs and on Facebook. This study makes theoretical contributions by proposing a customer‐centric SMC framework that integrates sustainability issues, stimulation of sustainable mindsets and encouragement of sustainable consumption. It also demonstrates how corporate sustainability marketing communications differ on different social media. In addition, practical suggestions are provided. Copyright © 2016 John Wiley & Sons, Ltd and ERP Environment     

Actions influenced by a social network

A simple framework is presented in which, each period, each of N individuals chooses among K alternatives. Individual actions are interrelated through a social network which arrays the strength of influence of each person on each other person. Emphasis is on the role of the network. The framework accommodates a variety of particular contexts, suggests theorems, and unifies a sizable part of the fragmented literature on network interaction.     

Synergy,learning and the changing industrial structure

In a set-up of two local firms and one foreign firm, we construct a model to capture the dynamics of local industrial structure induced by formation and breakdown of cross-border joint ventures (JVs). There is a synergic gain to the JV, and the partners learn from each other. Firms play a repeated game. We characterize the resulting industrial configurations under different scenarios as defined by the extent of cost saving. In particular, we show that when cost saving is moderate, an alliance formed between two firms in the first period, breaks up and a new alliance is formed in the second period, but again it breaks up; thereafter the market becomes an oligopoly of all three firms.     

Reconciling traditional Chinese management with high‐tech Taiwan

The traditional view of management culture among the overseas Chinese is that of an autocratic, paternalistic and centralised organisation with low levels of trust of ‘outside’ professional managers and employees. By contrast, the organisational culture associated with successful innovation and/or high technology is that of a decentralised organisation with high levels of employee autonomy. Existing research indicates that the overseas Chinese have become successful by sticking to the business sectors compatible with their preferred management culture, and that this holds true for Taiwan. What, then, explains the Taiwanese success in high‐technology ventures? This article offers initial evidence that management culture in Taiwan is adapting in order to enable industrial development in new areas. In‐depth interviews with 20 Taiwanese companies indicated that the change is being led by the high‐technology businesses. However, while many of these business culture changes are in a direction towards the organisational culture associated with high‐technology companies, it is also clear that a strong Chinese influence remains.     

Organizational characteristics and the CRM adoption process

The purpose of this study is to identify the status of Customer Relationship Management (CRM) adoption and explore the influence of organizational characteristics on the CRM adoption process in the Korean fashion industry. Using Rogers' [Rogers EM. Diffusion of innovation. New York: Free Press; 1995] innovation decision process model as the conceptual basis, this study surveyed 94 Korean fashion companies to investigate the persuasion, decision, and implementation stages of CRM adoption. Organizational variables included firm characteristics (size, strategy, maturity of information system), product characteristics (category, fashion position, seasonality), and CEO characteristics (age, education). The most frequently used CRM technology is the development of a customer database, whereas the mostly frequently mentioned benefits of CRM are encouraging repurchase. Moreover, respondents' perceptions of CRM benefits affect CRM adoption, influencing the use of various CRM technologies. Organizational strategy, maturity of information system, and product category all significantly influence the adoption process. Empirical findings provide further support for the innovation decision process model developed by Rogers [Rogers EM. Diffusion of innovation. New York: Free Press; 1995] and the CRM adoption model can be used when fashion companies do strategic planning and evaluate the possibility of adopting CRM strategies.