OPTIMAL EXPORT AND HEDGING DECISIONS WHEN FORWARD MARKETS ARE INCOMPLETE

This paper examines the behaviour of the competitive firm that exports to two foreign countries under multiple sources of exchange rate uncertainty. There is a forward market between the home currency and one foreign country's currency, but there are no hedging instruments directly related to the other foreign country's currency. We show that the separation theorem holds when the firm optimally exports to the foreign country with the currency forward market. The full‐hedging theorem holds either when the firm exports exclusively to the foreign country with the currency forward market or when the relevant spot exchange rates are independent. In the case that the relevant spot exchange rates are positively (negatively) correlated in the sense of regression dependence, the firm optimally opts for a short (long) forward position for cross‐hedging purposes.     

The Effects of Superstition on Choice and Latency

This study investigates the effects of superstition characteristics on choice and latency. Three dimensions of superstition are investigated—valence, accessibility, and relevance. Exposure to negative, accessible, or relevant superstition resulted in faster choices made. Superstitions that were negative or relevant led to choices favoring the auspicious product than superstitions that were positive or irrelevant. The auspicious product was also more likely to be chosen if it were associated with a superstition that was more accessible than less accessible. Findings also suggested that when superstition was relevant, the effects of a negative superstition were amplified than when superstition was irrelevant. Relevancy had less effect on positive superstition.     

Corporate Governance, Board Diversity, and Firm Value

This study examines the relationship between board diversity and firm value for Fortune 1000 firms. Board diversity is defined as the percentage of women, African Americans, Asians, and Hispanics on the board of directors. This research is important because it presents the first empirical evidence examining whether board diversity is associated with improved financial value. After controlling for size, industry, and other corporate governance measures, we find significant positive relationships between the fraction of women or minorities on the board and firm value. We also find that the proportion of women and minorities on boards increases with firm size and board size, but decreases as the number of insiders increases.     

Structural Equation Modeling of Consumer Purchase Intention Toward Synthetic Functional Foods

Functional foods are gaining greater popularity around the world. They are not just a new category of food products marketed for their health benefits, but their competitive market has made consumers become more favorable toward firms that are involved in this industry. The public is increasingly concerned about health and food-related risks. They tend to make decisions on food consumption, food storage, and food preparation on a more ideal perspective based on health and safety. Therefore, the objective of this study is to determine the factors and intention of Malaysian consumers to purchase synthetic functional foods. Structural equation modeling is used to accomplish the objectives of this study with the feedback received from the 2,004 households who were interviewed through a structural questionnaire. The results show that the most influential factors influencing consumer purchasing intention toward synthetic functional foods are perceived benefits followed by attitude and subjective norms.     

Do Nonprofit Hospitals Exercise Market Power?

Several theories of nonprofit hospitals behavior predict that nonprofit hospitals behave in the consumer interest and thus do not exercise market power. If these theories are correct, then antitrust enforcement of hospital mergers should be restricted only to those markets in which a nonprofit hospital cannot offset anticompetitive behavior by for-profit hospitals. In this paper, we examine the relationship between price and market concentration among nonprofit hospitals in California in 1993. We find that nonprofit hospitals set higher prices in more concentrated markets. This result suggests that antitrust enforcement should challenge those mergers of nonprofit hospitals that create market power without creating offsetting efficiencies.     

The environmental effect of trade liberalization: Evidence from China's manufacturing firms

While prior literature on trade liberalisation and the environment has mostly focused on the macroeconomic ramifications, this study explores at the firm level whether and how changes of trade barriers brought about by China's accession to the WTO may impact on its manufacturing firms’ environmental performance. Adopting a difference-in-differences (DID) methodology, we document the effects of tariff reductions on improving firm-level SO2 emission intensity, and the key corporate strategic decisions responsible for delivering the observed results, with robustness tests covering other major pollutants. In response to trade liberalisation, firms are found to increase labour resources for environmental protection and to improve their production processes to reduce emission intensity. This study contributes to the literature by investigating at the level of the operating firm how output and input tariff reductions may impact on environmental performance and uncovering for the first time the specific actions responsible for the results.     

Race,homophily, and purchase intentions and the Black consumer

Black consumers are an important market for advertisers to reach. However, designing effective communication strategies is difficult. This study examines the moderation effect of ethnic identification (strength of identity with other blacks) on the tie between advertising stimuli (with racially congruent or incongruent actors) and the subject's perceived homophily (similarity) toward actors featured in ads, and if perceived homophily influences purchase intentions regarding advertised products. ANOVA found a significant interaction between ethnic identity and racial congruity on the perceived level of homophily. In addition, a simple effect for racial congruity on perceived homophily was found. Regression analysis subsequently found a significant effect for the level of perceived homophily on the level of purchase intent. Strategic considerations for marketing advertisers and future research ideas are also presented. © 2000 John Wiley & Sons, Inc.     

The work values and job involvement of Post-80s employees in the hospitality and tourism industry: empirical evidence from Macau

The purpose of this research was to examine the work values (WV) and the job involvement (JI) of the younger workforce in a Chinese society. Specifically, the study explores the case of Macau, which has transformed from a sleepy enclave to a gambling mecca. The findings from 384 full-time Chinese employees revealed four WV factors considered important to them. The Post-80s value the social environment and freedom. WV are significantly positively correlated with JI and vary significantly across demographic variables. Intrinsic WV have prediction power towards JI. The lack of research on the younger generation particularly in this popular tourism destination contribute to a better understanding and management of the workforce. It also highlights that traditional Chinese managerial practice might not be able to cope with the new expectations and work habits of the younger workers.     

Export and Strategic Currency Hedging

This paper examines an international Cournot duopoly wherein a home firm and a foreign firm compete in the home market under exchange rate uncertainty. The foreign exporting firm, being risk averse, has incentives to hedge its exchange rate risk exposure. In a two-stage setting, we show that hedging via an unbiased currency futures market acts as a strategic device. In particular, under either constant or decreasing absolute risk aversion, an increase in the hedging volume of the foreign firm promotes its exports and deters the home firm’s output. In contrast to the well-known full-hedging result in a perfectly competitive environment, we find that the foreign firm over-hedges for strategic reasons. Furthermore, the separation result from the hedging literature under perfect competition no longer holds in our duopoly framework, i.e., equilibrium output levels depend on the risk attitude of the foreign firm as well as the probability distribution of the spot exchange rate.