Technological Upgrading under Tariffs and Equivalent Quotas*

This paper compares the effect of tariffs and that of equivalent quotas on the domestic firm’s production technology choice when it competes with a foreign firm in the domestic market. It is shown that under Bertrand price competition, the ranking of technology under tariff protection and quota protection is ambiguous, as it depends on the relative strength of the strategic vs output effects. The equivalent quota regime can generate a higher‐technology (implying a lower production cost) choice than the tariff regime if the strategic effect dominates the output effect. In contrast, the technology level is necessarily higher under the tariff regime than under the equivalent quota regime when the firms engage in Cournot quantity competition.     

Optimum tariff on imports from imperfectly competitive labor-managed firms

This paper develops a model of international trade between a labor-managed economy and a capitalist economy and examines the short- and long-run optimal specific tariff in the presence of foreign imperfect competition among labor-managed firms. It will be shown that the underlying conditions for the optimal tariff rule are different from conventional wisdom.     

Transport rates structure,optimum location,and theory of production: Reexamination

The two-stage approach consistently to present a generalized location theory of the firm in linear space is employed. It is shown that the second-order sufficient condition for the profit-maximizing and/or cost-minimizing location problem requires that transport rates increase with distance. In the process, it is demonstrated that this approach provides a compact way to analyze the location and production decisions separately and to avoid the errors made by Mathur and others.     

Auditor selection and corporate social responsibility

This study examines the association between the selection of an industry‐specialist auditor and corporate social responsibility (CSR). We find that firms with higher CSR ratings are more likely to hire industry‐specialist auditors (national‐level industry leaders, city‐level industry leaders or joint city‐national industry leaders). Moreover, firms with better CSR performance related to product quality and the environment in controversial industries are found to select non‐specialized auditors. The results suggest that such firms may overinvest in CSR activities associated with the environment and product issues to disguise the sin nature of their manufactured goods, and simultaneously engage low quality auditors perhaps to avoid full disclosure of potential environmental and legal liabilities. Overall, we conclude that CSR is associated with the non‐controversial firms ensuring high quality financial reporting in response to societal expectations, and thus CSR firms in such industries have strong incentives to engage industry‐specialist auditors.     

Consumer participation in virtual communities: The role of personal values and personality

The important role that consumers play in virtual communities as active participants in the value co-creation process has been increasingly acknowledged in recent marketing thought and practice. This study applies and extends the well-established value–attitude–behaviour (VAB) model to investigate how personal values and personality jointly influence consumers' attitude and behaviour towards their participation in virtual communities. The results show that while the resultant conservation value dimension has an indirect influence on consumer participation behaviour in virtual communities through attitude, the extraversion trait has a direct effect. The findings clarify our understanding of how personal values and personality differently predict consumer participation in virtual communities, and confirm the role of personal values and the VAB model in explaining this phenomenon. This study suggests significant implications for virtual community marketing.     

Consumers' perceptions of mail‐order speciality foods

The objectives of the study are to examine consumers' perceptions of speciality food mail‐order products on the basis of a mail survey of “active” and “inactive” mail‐order shoppers. The paper identifies a profile of mail‐order shoppers, examines the influence of perceived risk and the effectiveness of risk relievers, derives the dimensions of perceived benefits and establishes consumer segments based upon benefits sought.

The results reveal a distinct profile of active in‐home shoppers with resped to demographic and lifestyle variables.

Shoppers perceive higher levels of risk with mail‐order shopping compared to in‐store shopping. Appropriate risk relievers are identified for both active and inactive groups.

Consumers' perceptions of the benefits of mail‐order emphasis quality, uniqueness and convenience. However, underlying these attributes are four main dimensions of customer relations and service, convenience, nostalgia and uniqueness.

Furthermore, it is possible to identify two segments of active mailorder shoppers in terms of a produd‐oriented group and a mail‐order‐oriented group.     

Born-global: The case of four Vietnamese SMEs

Despite the fact that many firms in a wide range of industries in various countries internationalize at or near inception, research on factors leading to the formation of born-globals has been limited to firms from advanced, open economies. In order to give a voice to the phenomenon of Vietnamese founding born-globals, we conducted an exploratory, multiple-case study. Three findings of this study are: (1) the major driver to the formation of Vietnamese born-globals is the entrepreneurs’ leadership desire together with the need for short-term profits; (2) their choice of internationalization mode is influenced by market conditions as well as the internationalization degree of the industries in which they find their business opportunities; and (3) the reason why other motivators found in earlier studies do not apply lies in the peculiarity of the Vietnam context.

Evaluating horizontal mergers in the presence of price promotions

Quantitative Marketing and Economics - In this paper, I investigate the impact of a horizontal merger between firms that use price promotions. I find that after the merger, the merged firms...     

Robust XVA

We introduce an arbitrage‐free framework for robust valuation adjustments. An investor trades a credit default swap portfolio with a risky counterparty, and hedges credit risk by taking a position in defaultable bonds. The investor does not know the exact return rate of her counterparty's bond, but she knows it lies within an uncertainty interval. We derive both upper and lower bounds for the XVA process of the portfolio, and show that these bounds may be recovered as solutions of nonlinear ordinary differential equations. The presence of collateralization and closeout payoffs leads to important differences with respect to classical credit risk valuation. The value of the super‐replicating portfolio cannot be directly obtained by plugging one of the extremes of the uncertainty interval in the valuation equation, but rather depends on the relation between the XVA replicating portfolio and the closeout value throughout the life of the transaction. Our comparative statics analysis indicates that credit contagion has a nonlinear effect on the replication strategies and on the XVA.