Neo-liberal Korea and Still Developmentalist Japan: Myth or Reality?1

Abstract

In the “varieties of capitalism” debate, scholars have paid considerable attention to the question of whether Korea and Japan have left behind their interventionist political economy for neo-liberal reform. In this paper, we re-examine the scholarly consensus that Korea has become a neo-liberal state, while Japan has not changed much. On the basis of our comparison of the extent of the two countries’ neo-liberal reforms using the “business systems framework” developed by Witt, we demonstrate that neo-liberal reforms observed in Korea and Japan are not substantially different enough to warrant the view that the two countries have taken divergent paths of institutional development. With this finding, we call for further empirical study, including the development and use of more qualitative data. We suggest that the future direction research should take on this issue in order to make theoretical contributions to the existing literature on institutional change and continuity in “non-liberal” capitalist countries. We do this by offering some methods in which future researchers could identify necessary and sufficient causes of Korea's and Japan's neo-liberal (or non-neo-liberal) shift.     

Does board social capital influence chief executive officers' investment decisions in research and development?

The findings of the chief executive officer (CEO) characteristics–research and development (R&D) investment relationship remain incomplete if previous unexamined contingencies are not considered. Very few studies in this area have invariably focused on the constraints from the external environment and overlooked the important influence of board social capital on such relationship. This study uses insights from resource dependence theory to examine how the effects of CEO characteristics on R&D investment are contingent on board social capital. The results show that board social capital mitigates/enhances the negative/positive effect of CEO tenure/CEO educational level on R&D investment, supporting the view that board social capital, as an important conduit to link firms to critical information and essential resources in the environment, may offer better counsel to CEOs and enhance their decision‐making capabilities in moving toward R&D. One important implication is that firms wishing to encourage innovation through R&D spending should consider nominating directors with rich social capital to the board because they may assist CEOs in coping with R&D complexities and acquiring requisite resources, leading to a better planning of R&D.     

Assessment of Chinese Students' Experience With Foreign Faculty: A Case Study From a Chinese University

This article compares Chinese students' responses to local Chinese versus American professors, and the effectiveness of the professors' respective teaching techniques. A case study made at a single university in China, which had a joint academic program with the United States, found that Chinese students preferred local Chinese professors to American professors in spite of the students' perception that the American professors' were more highly qualified, and despite the American professors' student-centered teaching styles. The Chinese students consider local Chinese professors to be more effective in teaching and they have higher expectation of the Chinese students than the U.S. professors. This article explores the differences between Chinese and Western teaching styles and proposes approaches needed to guide Chinese students from their familiar teacher-centered classrooms toward accepting a student-centered classroom approach. Recommendations are offered for improving Western ways of educating Chinese students in China.     

Minimizing the Probability of Lifetime Ruin under Random Consumption

Abstract

We determine the optimal investment strategy in a financial market for an individual whose random consumption is correlated with the price of a risky asset. Bayraktar and Young consider this problem and show that the minimum probability of lifetime ruin is the unique convex, smooth solution of its corresponding Hamilton-Jacobi-Bellman equation. In this paper we focus on determining the probability of lifetime ruin and the corresponding optimal investment strategy. We obtain approximations for the probability of lifetime ruin for small values of certain parameters and demonstrate numerically that they are reasonable ones. We also obtain numerical results in cases for which those parameters are not small.     

Tax‐efficient irregular payout methods: The case of B share schemes and capital repayments via a court‐approved scheme of arrangement

Advance corporation tax (ACT) increased the tax cost to UK firms of distributing cash to shareholders. We demonstrate how the tax cost arising from ACT payments affected the channels through which UK firms returned capital to shareholders. In particular, we document and describe two unconventional irregular payout methods that enabled firms to avoid paying ACT. Firms choosing these methods are associated with significantly greater ACT problems than a control sample of firms that opted for conventional self‐tender offers and special dividends. Event study tests indicate that the decision to adopt tax‐efficient payout methods created significant additional value for shareholders beyond the basic cash distribution decision.     

Market skewness risk and the cross section of stock returns

The cross section of stock returns has substantial exposure to risk captured by higher moments of market returns. We estimate these moments from daily Standard & Poor's 500 index option data. The resulting time series of factors are genuinely conditional and forward-looking. Stocks with high exposure to innovations in implied market skewness exhibit low returns on average. The results are robust to various permutations of the empirical setup. The market skewness risk premium is statistically and economically significant and cannot be explained by other common risk factors such as the market excess return or the size, book-to-market, momentum, and market volatility factors, or by firm characteristics.     

An investigation of the increasing prevalence of nonpurchase of meat by British households

The purpose of the analysis has been to investigate the determinants of the household's decisions regarding the purchase of meat in Great Britain. The approach, using a Box-Cox generalization of the ‘double hurdle’ model, has depicted the household making two choices, namely whether or not to purchase the product (the participation decision) and then, for those households which do purchase, how much to buy (the expenditure decision). The determinants considered are socioeconomic variables, such as the total expenditure of the household, market prices, characteristics of the householder (age, gender, education, type of employment) and characteristics of the household (location, presence of children, etc.). By conducting the analysis over several years of survey data (1975–1993) it is possible to investigate whether the influence of these variables has changed over time. The bulk of the empirical analysis has concerned single adult households (with or without children).     

Generational differences in international stereotypes and destination images: tourism between partitioned states

Studies have attempted to understand tourism issues between politically divided countries, yet few studies have argued that tourism between such states has a strong generational component. This study examines the generational differences in South Koreans’ international stereotypes and tourism destination images of North Korea. While generational differences existed in international stereotypes, there were no differences in tourism destination images between generational cohorts. Young female South Koreans were likely to view North Korea more positively than males in the same generation, and generational differences were present in the intention to visit North Korea and the perception of peace through tourism.     

Measuring Attribute-Specific and Overall Satisfaction with Destination Experience

Researchers have measured tourist satisfaction at both overall (global) and attribute levels, and found that attribute-specific satisfaction significantly influences overall satisfaction. When satisfaction is operationalized at two levels, the measurement structure presents “specific-general” questions, which may yield psychological effects due to the ordering of questions. This study examined question order effects when measuring attribute and overall satisfaction with destination experience and investigated the role of information satisfaction. Results revealed that information satisfaction is a significant predictor of attribute and overall satisfaction, and overall satisfaction was consistently higher than the average of attribute-specific satisfaction which was asked prior to overall satisfaction. Therefore, it can be inferred that overall emotional satisfaction reflects something more than the aggregated satisfaction level with attributes of destinations.