Information technology investment strategies: a review and synthesis of the literature

In spite of high importance of information technology (IT) investments, managers do not have sufficient guidelines to formulate IT investment strategy of a firm. In this paper, we review the literature to determine the factors that influence the IT investment strategy. The concept of IT investment strategy so far considered two domains: intensity and proactiveness; we enhance this concept by adding the domain of investment focus. Through this review, we made an attempt to answer three strategic questions related to IT investments: (i) level of investment that a firm should make in IT, that is, investment intensity; (ii) areas of firm where these investments should be more focused, that is, investment focus; and (iii) timing of investment, that is, whether to be an early mover in adopting IT or whether to invest relatively late compared to competitors.     

Dynamic capabilities through continuous improvement infrastructure

We examine the content of continuous improvement strategies and identify infrastructure decision areas that are important for continuous improvement initiatives. We present a framework of infrastructure based on the idea that continuous improvement can serve as a dynamic capability when it includes a comprehensive organizational context. Further, we study continuous improvement initiatives in five companies to investigate the practices used by them in each of the decision areas of our framework. This research adds to the conceptual understanding of continuous improvement and results in grounded propositions about critical areas of infrastructure for continuous improvement.     

MaxVaR for non-normal and heteroskedastic returns¶

In this work we propose Monte Carlo simulation models for dynamically computing MaxVaR for a financial return series. This dynamic MaxVaR takes into account the time-varying volatility as well as non-normality of returns or innovations. We apply this methodology to five stock market indices. To validate the proposed methods we compute the number of MaxVaR violations and compare them with the expected number. We also compute the MaxVaR-to-VaR ratio and find that, on average, dynamic MaxVaR exceeds dynamic VaR by 5–7% at the 1% significance level, and by 12–14% at the 5% significance level for the selected indices.     

Institutional trading and stock resiliency: Evidence from the 2007–2009 financial crisis

We examine the impact of institutional trading on stock resiliency during the financial crisis of 2007–2009. We show that buy-side institutions have different exposure to liquidity factors based on their trading style. Liquidity supplying institutions absorb the long-term order imbalances in the market and are critical to recovery patterns after a liquidity shock. We show that these liquidity suppliers withdraw from risky securities during the crisis and their participation does not recover for an extended period of time. The illiquidity of specific stocks is significantly affected by institutional trading patterns; participation by liquidity supplying institutions can ameliorate illiquidity, while participation by liquidity demanding institutions can exacerbate illiquidity. Our results provide guidance on why some stocks take longer to recover in a crisis.     

Economic reforms of agriculture and rural growth

Successful rural growth episodes in India indicate a process of growth and diversification that is based on the development of producer services. A simple theoretical model of this process is sketched to suggest impediments to such a process of growth and thus to offer a possible explanation of rural stagnation in many areas in India. Agricultural policies in India of the present and the recent past are analysed in the light of such a framework.     

Leveraging Virtual Attribute Experience in Video Games to Improve Brand Recall and Learning

This article extends the concept of virtual direct experience (VDE) from a product to an attribute as video gamers can virtually experience an attribute within a gaming environment. Using a 2 (VAE: present versus absent) x 2 (order of brand presentation: first or second) between subjects experimental design, we find that associating a brand with virtual attribute experience (VAE) by exposing consumers to the brand name and the virtual experience simultaneously has a positive effect on brand recall, brand extension acceptance, overall attitude, and purchase intention. In addition, our results demonstrate a significant interaction between VAE and telepresence on brand recall.     

Contextual and Competitive Interference: Inhibition or Facilitation?

Existing literature has found two sources of advertising interference, competitive and contextual, that decrease the effectiveness of an ad in a cluttered environment. However, to date, the negative impact of competitive and contextual interference has been examined independently. This research explores advertising effectiveness when these sources exist concurrently. Contrary to the supposition concerning the additive effects of both sources of interference when simultaneously present, our findings indicate that viewing ads for the same product category with similar executional elements leads to the dissipation of interference effects (Study 1). Consistent with the process rationale, when a product-brand cue (versus a picture cue) is provided, this novel effect disappears (Study 2). The implications of these findings for advertising are highlighted in the discussion section.     

A trade theoretic analysis of outward capital flows: with special reference to Hong Kong

This paper sets up a trade theoretic model to explain the output, price and welfare consequences of the outward investment from Hong Kong to the Pearl River Delta. A four-good trade theoretic model is set up to incorporate some special features of the Hong Kong Economy. We assume that the economy produces four goods: an exportable good, an importable good and two non-traded goods. A special feature of the model is that one of the non-traded goods (locally produced) is also consumed by foreigners and produced under the assumption of non-competitive market framework. As tourist or business-centre trade is of great significance to Hong Kong, this model allows us to capture this phenomenon. First, precise conditions are derived regarding the decline in manufacturing output in Hong Kong. Second, it is shown that, in spite of the supply side determination of the relative price of non-traded goods, income effects in this market are of great significance in both income (welfare) and output movements. These income effects cannot be captured in industrial organization type applied work. Third, it is shown how outflow of capital affects labour productivity. A surprising result obtained for this part of the analysis is that a fall in productivity (outflow of capital and de-industrialization) creates a favourable terms-of-trade effect in the monopolized sector. The welfare effect consists of four terms: (1) a terms-of trade effect via the price of non-traded goods consumed by tourists/foreigners; (2) the loss (gain) in productivity due to an outflow of capital; (3) repatriation payments; and (4) the gains from exporting from the Special Economic Zones as well as other Pearl River Delta cities. Our decomposition has two very important features in contrast to traditional models: a terms-of-trade effect from the consumption of services and productivity gains or losses. The last point is exceedingly important for policy makers specifically if outward flow of capital affects productivity negatively.     

On using relative prices to measure capital-specific technological progress

Recently, Greenwood, Hercowitz and Krusell (GHK) have identified the relative price of (new) capital with capital-specific technological progress. In a two-sector growth model, however, the relative price of capital equals the ratio of the productivity processes in the two sectors. Restrictions from this model are used with data on wages and prices to construct measures of productivity growth and test the GHK identification, which is easily rejected by the data. This raises questions about various measures of the contribution that capital-specific technological progress might make to the economy. This identification also induces a negative correlation between the resulting measures of capital-specific and economy-wide technological change, which potentially explains why papers employing this identification find that capital-specific technological change accelerated in the mid-1970s. We impose structure on the productivity measures based on their long-run behavior and find evidence of a slowdown in productivity in the 1970s that is common to both sectors and an acceleration in the mid-1990s that is exclusive to the capital sector.     

Job autonomy, trust in leadership, and continuous improvement: An empirical study in health care

This research examines the influence of autonomy in day-to-day work on commitment of frontline employees to continuous improvement. Our hypothesized model links the job characteristics theory of work design that associates job autonomy with responsibility for outcomes, and the total quality management perspective that advocates empowering employees in order to generate commitment to continuous improvement. Further, as leadership is known to have a role in shaping job behaviors, and is considered important for the success of total quality management, the influence of trust in leadership on the relationship between job autonomy and commitment to continuous improvement is also examined. We test our hypotheses on data collected from individual employees working for an outpatient health care organization that is applying lean principles for managing and improving work processes. Based on our results, we present implications for organizations implementing continuous improvement initiatives such as lean, particularly in service environments such as health care.