Asymmetric effects of oil price changes on the balance of trade: Evidence from selected African countries

The main new contribution of this study was to delve into the asymmetric impacts of changes in oil prices on the trade balance in the framework of six major African economies. To tackle this topic carefully, we employ three measures of external balances—oil, non‐oil and total trade balances, and assess the asymmetric response of the external balances of those six economies to oil price changes in the short and long run. Like most previous studies, we first assume the impacts of oil price fluctuations to be symmetric and employ the linear autoregressive distributed lag (ARDL) method to explore the topic. We then separate oil price hikes from oil price plunges and implement the non‐linear ARDL method to reveal that the price of crude oil has a vital role to play in the trade balances for those six African economies. Further, there is evidence of significant asymmetric impacts of oil prices typically on the oil trade balance of Africa's top oil producing countries. For the non‐oil and total trade balances, in contrast, there is little evidence of the asymmetry of oil price changes.     

Efficiency and risk in commercial banking: empirical evidence from East Asian countries

This paper analyses the effects of off-balance sheet (OBS) activities and various types of risks on the cost and profit efficiencies of banks in seven East Asian countries between 2001 and 2008. Cost and profit efficiency scores are estimated using the data envelopment analysis approach. The results of this analysis are then used to identify the impact of OBS activities and risk exposures on cost and profit efficiencies using a Tobit regression. Bank insolvency risk (as measured by z-scores) is positively related to profit efficiency, while interest sensitivity, size, equity to total assets and OBS exposures all impact on cost efficiency. The analysis of the impact of input and output slacks illustrates that in around 1 in 5 cases banks’ cost efficiency can be improved by adjusting the former variables, whereas in only around 1 in 100 cases a similar outcome is possible for profit efficiency.     

The Seven Faces of Singaporeans: A Typology of Singapore Consumers and Their Aspirations and Life Satisfaction

A large-scale representative survey was conducted to examine lifestyle patterns of Singaporeans. The data were analyzed using a three-step approach. First, the underlying dimensions of Singaporeans' value system were identified using factor analysis. Based on 45 lifestyle and value items, six factors were obtained. The analysis suggests that the value system of Singaporeans can be described using the following six factors: (1) family values, (2) entrepreneurial spirit, (3) status, (4) traditional values, (5) materialism, and (6) society orientation. Second, these six factors were then utilized to identify clusters of Singaporeans with similar value profiles. The cluster analysis identified the following seven major groups of Singaporeans: (1) Traditional Family Oriented, (2) New Age Family Oriented, (3) Entrepreneurs, (4) Aspirers, (5) Materialists, (6) Pragmatists, and (7) Independents. Finally, to examine whether the identified value-based clusters could also be differentiated in terms of key demographic variables, a discriminant analysis was conducted. The results showed that the seven clusters had distinctive patterns along demographic variables. The examination of the aspirations and life satisfaction of the clusters showed that significant differences did exist among themselves. These differences in aspirations and life satisfaction were consistent with the traits and attitudes of the respective clusters and provided ample support to the grouping of the clusters.     

The effects of reference point, knowledge, and risk propensity on the evaluation of financial products

Evaluating and choosing a financial product often requires a trade-off between risk and returns on investment, as a riskier product may yield a higher return. We examine the effect of different reference points (i.e., a riskier reference vs. a safer reference) on the evaluation of a financial product when attributes are explicitly traded off during the evaluation. Our findings suggest that a safer reference increases the attractiveness of the focal product under evaluation, while a riskier reference point does not affect that evaluation. The safer reference point appears to facilitate the risk-seeking tendency in financial decision-making. Further, two types of consumer knowledge, namely, objective and subjective, can moderate the effect of the reference point. Subjective knowledge negatively affects attribute-based objective evaluations, promoting instead the use of external reference information. A discrepancy between the two types of knowledge (i.e., over-confidence), in particular, can cause a more biased evaluation.     

Local Content Requirement under Vertical Technology Diffusion

Many developing countries (LDCs) still impose a local content requirement (LCR) regulation on multinational enterprises (multinationals). The authors develop a simple model to investigate whether the introduction of an LCR affects a multinational's choice of technology transfer. The key assumption made in their analysis is that the multinational in an LDC prefers importing intermediate inputs from its home country, for the manufacture of final goods, to purchasing them from local suppliers equipped with outdated technology. However, the LCR of the LDC forces the multinational to purchase a fixed proportion of its intermediate inputs. The authors show that the magnitude of an LCR policy cannot affect the multinational's decision regarding technology transfer under technology diffusion. In addition, an increase in the LCR may foreclose technology diffusion because it could make the multinational establish its own intermediate input supplier(s) and become a vertically integrated multinational.     

Financial Analysts' Forecast Accuracy and Dispersion: High-Tech versus Low-Tech Stocks

This study focuses on systematic differences in security analysts' forecast accuracy and dispersion between high- and low-tech firms. In line with the recent development in theoretical models and empirical findings, it posits that security analysts' unsigned forecast error and forecast dispersion are expected to differ between high-tech and low-tech firms. The results of this study provide evidence of lower unsigned error and dispersion for high-tech firms vis-à-vis low-tech firms. The higher forecast accuracy and forecast convergence for high-tech firms relative to low-tech firms in financial analysts' forecasts of earnings can be attributed to the information effect prevailing over the noise effect. Given the lack of empirical studies that compare analysts' forecast accuracy and dispersion between high-tech and low-tech sectors, the results of this paper provide a fresh basis for assessing how market participants vary in their treatment of New Economy stocks and factors that affect such decisions. In the light of the fact that the 1990s is a period characterized by the start of the Information Revolution through the Internet, the results of this study shed light on the usefulness of examining factors that differentiate between high-tech firms (New Economy stocks) and low-tech firms (Old Economy stocks) in financial analysts' forecasting earnings.     

The efficacy of red flags in predicting the SEC's targets: an artificial neural networks approach

This paper illustrates the application of artificial neural networks (ANNs) to test the ability of selected SAS No. 53 red flags to predict the targets of the SEC investigations. Investors and auditors desire to predict SEC targets because substantial losses in equity value are associated with SEC investigations. The ANN models classify the membership in target (investigated) versus control (non-investigated) firms with an average accuracy of 81%. One reason for the relative success of the ANN models is that ANNs have the ability to ‘learn’ what is important. The participants in financial reporting frauds have incentives to appear prosperous as evidenced by high profitability. In contrast to conventional statistical models with static assumptions, the ANNs use adaptive learning processes to determine what is important in predicting targets. Thus, the ANN approach is less likely to be affected by accounting manipulations. Our ANN models are biased against achieving predictive success because we use only publicly available information. The results confirm the value of red flags, i.e. financial ratios available from trial balance in conjunction with non-financial red flags such as the turnover of CEO, CFO and auditors do have predictive value. © 2000 John Wiley & Sons, Ltd.     

Differences in business undergraduate perceptions by preferred classroom learning environment

Online education continues to grow at business schools. The authors compared undergraduate business student perceptions across three different classroom learning delivery environments: online, hybrid, and face to face. Based on the survey responses using two independent samples, the authors' analyses found that students who preferred online delivery perceived higher timely graduation and were more likely to recommend online or hybrid courses, whereas students' perceptions of persistence and institutional commitment were not related to classroom learning delivery preference.     

Price bundling presentation and consumer's bundle choice: The role of quality certainty

As bundling has become a prevalent marketing strategy, the existing literature has focused on how to present price discount information for bundled products. To further understand bundling in restaurant operations, this study examined the moderating role of consumer quality certainty on the relationship between the effects of price bundling and consumers’ bundle choices. This study analyzed different bundling phenomena from an acquisition–transaction utility theory perspective in order to investigate the effects of price presentation and quality certainty manipulation on consumers’ bundle choices. Hierarchical regression analyses showed that quality certainty had a significant moderating effect. The less confident a consumer is about the quality of the bundled food products, the more likely it is that price presentation strategies will affect his or her willingness to order a bundle menu. The results also showed that transaction utility becomes significant as price discount information is segregated and as consumers are more certain of the quality of the bundled products. Managerial implications for restaurant operations are also discussed.     

Sustainable Asset Growth and the Accounting Rate of Return in Not–For–Profit Organizations: Theory and Evidence

Parties needing to monitor the financial performance of not–for–profit (NFP) organizations have traditionally relied upon financial ratios of accounting data. This practice can lead to misleading inferences about profitability in relation to organizational needs, since accounting rates of return are potentially poor proxies for economic rates of return. In this paper we show how to compensate for the imprecision of the accounting rate of return through the use of a simple interpretive rule based on the finding that accounting and economic rates of return are on the same side of the growth rate. According to our rule, the accounting rate of return must exceed the asset growth rate in order to sustain growth with internally–generated cash flow. Logistic regressions are used to test the rule's ability to predict sustainable asset growth in a sample of NFP hospitals. The findings not only validate the rule, but also show that the rule exploits all usable information contained in the accounting rate of return