Dividend‐Rollover Effect and the Ad Hoc Black‐Scholes Model

One of the most widely used option‐valuation models among practitioners is the ad hoc Black‐Scholes (AHBS) model. The main contribution of this study is methodological. We carefully consider three dividend strategies (No dividend, Implied‐forward dividend, and Actual dividend) for the AHBS model to investigate their effect on pricing errors. We suggest a new dividend strategy, implied‐forward dividend, which incorporates expectational information on dividends embedded in option prices. We demonstrate that our implied‐forward dividend strategy produces more consistent estimates between in‐sample market and model option prices. More importantly our new implied‐forward dividend strategy makes more accurate out‐of‐sample forecasts for one‐day or one‐week ahead prices. Second, we document that both a “Return‐volatility” Smile and a “Return‐pricing Error” Smile exist. From these return characteristics, we make two conclusions: (1) the return dependency of implied volatility is an important explanatory variable and should be controlled to reduce the pricing error of an AHBS model, and (2) it is important for the hedging horizon to be based on return size, that is, the larger the contemporaneous return, the more frequent an option issuer must rebalance the option's hedge. © 2012 Wiley Periodicals, Inc. Jrl Fut Mark 32:742‐772, 2012     

From the wired to wireless generation? Investigating teens’ Internet use through the mobile phone

Scholars have an enduring interest in investigating whether a new medium displaces or complements existing media whenever a new medium is introduced to the society. In this study, it is sought to investigate the extent to which the mobile phone would replace or reinforce teens’ traditional Internet use through computers. Surveys were conducted on 1875 youths between 12 to 17 years old in 5 digital cities in East Asia: Hong Kong, Seoul, Singapore, Taipei, and Tokyo. The findings profile a digital generation that is highly connected in the 21st century. Ninety percent of all respondents used the Internet. Almost 90% of the teens in this study used the mobile phone, and two-thirds of them ever surfed the Web via their mobile devices. Through a factor analysis, three dimensions of teens’ use of mobile Internet were identified, namely, task-based activities, information seeking and communication activities, and recreational activities. In general, the teens tend to use the mobile phone for recreation and entertainment purposes, especially playing games and listening to music. They are less likely to use the mobile phone for more sophisticated purposes, such as petitioning, voting, or shopping. Drawing upon the niche theory, the patterns between teens' mobile Internet and PC Internet use were further compared. Our analysis shows that mobile Internet primarily serves as an extension of teens’ Internet activities via PC, rather than as a replacement. Such positive relationships are quadratic and non-linear.     

Tourists’ virtual reality adoption: an exploratory study from Lake District National Park

Virtual reality (VR) transforms the way destinations market their tourism offerings. To fully understand the opportunities of a technology, initial research is required assessing user adoption. However, empirical research and particularly exploratory qualitative research on VR adoption in tourism context is limited. Therefore, this study uses an exploratory interview approach with 35 participants near Lake District National Park, UK. Using thematic analysis, this study explores factors that influence VR adoption as well as the influencing factors on tourists’ behavioural intentions. This study adds to academia by qualitatively exploring the adoption of a scarcely researched technology within the tourism context.     

Diversity in organizations: Where are we now and where are we going?

A great deal of research has focused on workforce diversity. Despite an increasing number of studies, few consistent conclusions have yet to be reached about the antecedents and outcomes of diversity. Likewise, research on different dimensions of diversity (e.g., age, race, gender, sexual orientation, disability, and culture) has mostly evolved independently. Therefore, the purpose of this review is to examine each of these dimensions of diversity to describe common themes across dimensions and to develop an integrative model of diversity.     

Do Japanese CEOs matter?

In a country where individualism is emphasized less than in Western countries, we ask whether the CEO (shacho) of a Japanese corporation positively affects firm performance. To answer this question, we construct a shacho-firm matched panel data set in the period 1990 through 2002 of all listed 1419 Japanese manufacturing firms and their 3520 shachos. Though we find a positive abnormal stock return on the date a shacho change is announced, especially when the shacho change is non-routine, we document that this effect is short-lived. There seems to be no long-run positive change in performance or policies after a shacho change, even when the shacho change is non-routine. Finally, in trying to explain firm performance or policies, we attempt to separate a firm-fixed effect from a shacho-fixed effect, and are unable to disentangle a shacho-fixed effect. We are thus left to conclude that shachos do not positively matter in the Japanese corporation in this decade of a stagnant economy.     

Technological innovation in tyre manufacture

This paper discusses key factors in starting up local production of radials ahead of most other manufacturers, and how this affected comparative profitability. This led to the build-up of a viable capability for adapting basic overseas innovations to suit local conditions. It will be shown how this capability, in combination with independence in decision-making, compensated the Australian manufacturer relative to resources available to those manufacturers with overseas affiliations.