Alternative Regulatory Cases Challenging Consumer Policy

By means of the concept of postmodern politics, we provide insights into how alternative regulation is challenging consumer policy. New actors, new forms of interaction, and new goals are emerging alongside established forms of consumer policy. In particular, we examine two alternative regulatory cases: trust marks and consumer-generated information systems. They both exemplify alternative regulation of electronic commerce, which has facilitated regulatory innovation for over a decade. On the basis of our analysis, we suggest that governmental consumer policy cannot imitate the alternative regulatory solutions. We also encourage governmental actors to consider building bridges to consumer networks. This would broaden the scope of consumer policy and be in line with the modes of operation of governmental actors. Consumers are themselves contributing to this rethinking of governmental consumer policy. By networking, consumers provide each other with empowering information on consumption. Doing so on the massive scale enabled by information and communication technologies, they are challenging conventional consumer policy, which can no longer address consumer needs as it could in the pre-Internet days. New issues are emerging for consumer policy to address, and networked consumers are already contributing to policy.     

The Dynamics of Rivalry

Firms face a constant challenge to understand and manage competition over time: what to do when and how much, for how long, and with what expected effect. In this battle, managers use resources they already have to develop the further resources they need, faster and more sustainably than competitors. Just three forms of rivalry capture the dynamics of these processes: developing potential customers, capturing rivals' customers and competing for sales to shared customers. Each of these applies not only to customers, but also to other assets that must be won against rivals. In complex industries, interactions between many competitors can be simplified by grouping firms together, and industry evolution and scenarios for the future can be evaluated using extensions of this approach.     

“Pay 80%” versus “get 20% off”: The effect of novel discount presentation on consumers’ deal perceptions

Consumers often undervalue price promotions because they discount the discounts. In this research, we examine the effect of using a novel type of discount presentation (e.g., “Pay 60% of the regular price”) on deal evaluations, and compare it to that of an equivalent discount presentation commonly used in the U.S. (e.g., “Get 40% off the regular price”). In three experiments we show that the former discount presentation results in higher perceived savings and higher purchase likelihood than the latter. Using process measures, we demonstrate that this effect is due to increased systematic processing induced by the novelty of the discount presentation, which improves calculation accuracy and hence decreases the underestimation of discounts. We also report a boundary condition of the effect of discount presentations on deal evaluations by showing that it is eliminated when consumers do not need to expend effort to accurately process price information. Both authors contributed equally and are listed in alphabetical order     

Perceptions of the Ethical Climate in the Korean Tourism Industry

This study investigates the ethical climate types presented in the Korean tourism industry, the differences in the perceptions of these ethical climate types based on individual/organizational characteristics, and the influence of ethical climate types based on job satisfaction/organizational commitment. Empirical findings of this study identify six ethical climate types and demonstrate significant difference and significant influence of the proposed relationships. This research contributes to the existing body of academic work by using empirical data collected from 820 respondents across 14 companies within the Korean tourism industry, to demonstrate the relationship between actual ethical climate types and ethical climate related factors. The findings of this study identify the new factor ‹moral caring,’ which describes an environment characterized by decisions that maximize collective interest, but based on an individual employee’s personal values and ethics. Such a factor has important implications for the service industry, where face-to-face encounters typify the relationship between employee and consumer.     

Shopping value in online auctions: Their antecedents and outcomes

Online auctions present unique characteristics in the consumer decision-making process that raise new issues related to consumer shopping behaviors in auction-based purchases. The present research examined the relationship between consumer characteristics (i.e., compulsive buying behavior, variety-seeking tendency, and price sensitivity) and shopping value (i.e., utilitarian and hedonic) in online auctions and found that both compulsive buying behavior and variety-seeking tendency are critical factors of shopping value in the online auction environment. There were no positive relationships between price sensitivity and shopping value. The results of this study also revealed that consumers’ shopping value positively influenced their preference, which, in turn, formed behavioral intentions in online auctions. While utilitarian value was found to be a significant predictor of behavioral intentions, hedonic value was not. However, hedonic value influenced intentions indirectly through preference.     

Go before the whistle blows: an empirical analysis of director turnover and financial fraud

This study investigates whether outside directors are aware of financial fraud. Our analysis focuses on the abnormal turnover of these directors during the fraud committing period, before fraud is discovered and before lawsuits are filed. Our empirical analysis shows that, during the fraud committing period, outside directors in fraud firms exhibit an abnormal level of turnover. Examining the characteristics of outside directors and boards at these fraud firms, we find strong evidence that female directors, directors who have greater stock ownership in the firm, and directors with multiple directorships at other firms are more likely to depart fraud firms. We also find some evidence that board size, number of meetings, and fraction of financial experts are related to abnormal turnover in fraud firms during the fraud committing period. We show that abnormal director turnover is significantly higher for fraud that is considered more egregious (i.e., involving fictitious transactions and disclosure problems). Lastly, directors are more likely to depart fraud firms with more serious fraud, as proxied by higher ex-post settlement amounts and longer fraud duration.