Green practices in the restaurant industry from an innovation adoption perspective: Evidence from Taiwan

This study proposes an integrated model that combines the theory of planned behaviour (TPB) and the innovation adoption theory to investigate the attitudinal and behavioural decision factors on adopting green practices in the restaurant industry in Taiwan. The results demonstrate that attitude and perceived behavioural control have positive effects on behavioural intention while social influence is insignificant. Perceived innovation characteristics have direct positive effects on attitude and indirect positive impacts on behavioural intention to adopt green practices. Managerial implications are discussed.     

Determinants of geographic differentials in the Savings and Loan failure rate: A heteroskedastic TOBIT estimation

This article has empirically studied determinants of interstate differentials in the S&L failure rate. The heteroskedastic-TOBIT model used in estimation turns out to perform much better than either OLS or the homoskedastic-TOBIT. Significant efficiency gain is obtained in formulating the multiplicative heteroskedasticity. Four types of variables are important: regional economic conditions, asset/liability management, regulatory structure, and politics.Georgia Institute of TechnologyGeorgia Institute of Technology     

How to create competitive advantage: the moderate role of organizational learning as a link between shared value,dynamic capability,differential strategy,and social capital

Based on the organizational strategy and capability perspective, we theorized a serial mediation-moderation analysis that links critical beneficial attributes of dynamic capabilities, differential strategies, social capital, shared goals, and organizational learning to creating competitive advantage. Results from a survey of 328 travel agencies were analysed to support our hypotheses. We found that travel agencies’ shared goals may influence competitive advantage through the characteristics of dynamic capability development, differential strategy implications, and social capital accumulation. We also found that organizational learning is the most critical attribute for improving the relationships between shared goals, dynamic capabilities, and social capital to achieve competitive advantage. The implications of these findings for managerial and theoretical frameworks are also discussed.     

Earnings management and long-run stock performance following private equity placements

We investigate whether the documented earnings management preceding public equity offerings applies to private placements of equity. We also investigate whether earnings management can help explain long-run stock performance following private placements. Our main findings are: (1) little evidence of upward earnings management around private equity placements, and (2) little predictive power of abnormal accruals for long-run stock performance following private equity placements. These results suggest that earnings management is not responsible for post-offering underperformance, if any, for firms issuing equity privately. Our results are robust to two alternative measures of earnings management and three measures of abnormal returns estimated over two sample periods.     

Introduction

This study decomposes the unconditional stock return volatility into two categories: systematic versus idiosyncratic risk, to re-examine the link between size and risk in the banking industry. The feasibility of the model is tested using data for US banks from 1998 to 2007. The evidence uncovered suggests that the practice of size-related diversification obtained with large banks reduces the firm-specific risk, and thus weakens stock return variances. However, rather than eliminating firm-specific risk, it is being transformed into systematic risk. Additionally, our empirical findings can potentially explain why a bank's size-related diversification does not result in a reduction in its unconditional stock return volatility reported in Demsetz and Straha [Historical patterns and recent changes in the relationship between bank size and risk. Federal Reserve Bank of New York Economic Policy Review, 1(2), 13–26 (1995); Diversification, size, and risk at bank holding companies. Journal of Money, Credit, and Banking, 29, 300–313 (1997)].     

Fitting and testing for the implied volatility curve using parametric models

Numerous issues have arisen over the past few decades relating to the implied volatility smile in the options market; however, the extant literature reveals that relatively little effort has thus far been placed into comparing the various implied volatility models, essentially as a result of the lack of any theoretical foundation on which to base such comparative analysis. In this study, we use a comprehensive options database and employ methods of combining the various hypothesis tests to compare the different implied volatility models. To the best of our knowledge, this is the first study of its kind to address this issue using combination tests. Our empirical results reveal that the linear piecewise model is the most appropriate model for capturing the implied volatility smile, with additional robustness checks confirming the validity of this finding.     

The public incumbent's defeat in mobile competition: Implications for the sequencing of telecommunications reform

Within a mere 5 years of market competition, the mobile communications sector in Taiwan has exceeded a 100% penetration rate, currently ranking near the top of the world. In an even more stunning development, the public incumbent, Chunghwa Telecom, has handed the leadership status to a market entrant, Taiwan Cellular Corp., despite phenomenal mobile communications growth. This paper explores the factors that hamstrung Chunghwa Telecom in competition against its rival entrants. Our econometric analysis substantiates the fact that handset subsidies are the most effective instrument for mobile firms to gain market share. Chunghwa Telecom, due to its public ownership status, was nevertheless prohibited at first from adopting such a marketing strategy.The empirical results provided in this paper indeed pinpoint the importance of the sequencing of reform mandates in developing telecommunications: a prolonged privatization could help to promote competition in the industry. Public ownership makes Chunghwa Telecom vulnerable to political intervention and operational inefficiency, which is a barricade to performance and competitiveness for the not-yet-privatized company in a liberalized market. Taiwan's case presents an interesting deviation from conventional development theories, while it deserves scrutiny as it paves a shortcut to successful implementation of telecommunication reform in a timely fashion.     

Order Imbalance and Its Impact on Market Performance: Order-driven vs. Quote-driven Markets

Abstract:  The behavior of order imbalance and its impact on market performance at the two Taiwan stock index futures markets, the TAIFEX and the SGX-DT, is investigated. The TAIFEX is an order-driven call market, while the SGX-DT uses a quote-driven continuous trading system. Our empirical results show that for the TAIFEX order-driven market, the spread is minimized when order imbalance is high. In contrast, for the SGX-DT quote-driven market, the spread is highest when order imbalance is high. For both markets, order imbalance has an impact on market liquidity and volatility. The impact is larger and more significant for SGX-DT futures. This suggests that the order-driven market mechanism of TAIFEX futures is superior in absorbing order imbalance and in reducing the resulting price impact.     

Pacific Basin stock markets and international capital asset pricing

In this paper, we follow Harvey (1991) to investigate whether rates of return on Pacific Basin stock markets can be explained by conditional version of International Capital Asset Pricing Model (ICAPM), which allows for time-varying expected returns, variances, and covariances. The results show that most individual Pacific Basin markets can be described by the conditional ICAPM. However, the multiple markets' tests do not support the conditional ICAPM formulation, and the estimates of world reward to risk ratio are not the same across these markets. Furthermore, the Ghysels and Hall test (Ghysels & Hall, 1990a, 1990b) shows that the estimates of parameter are also unstable in the conditional ICAPM formulation. This implies that it is difficult to use world return to describe the relationship between expected return and risk for the Pacific Basin stock markets.     

Configuration of innovation and performance in the service industry: evidence from the Taiwanese hotel industry

This study attempts to state some facts about the importance of innovation in the service economy, and especially the hotel industry by classifying the configurations of innovation in Taiwanese hotels, as well as considering the types of innovation configuration that will maximise performance. Technological innovation, organisational innovation, and human capital innovation may be key sources of innovation. This study classified the configurations of innovation based on several innovation activities with two-step cluster analysis. Numerous empirical findings facilitate improved understanding of the relationship between the configurations of innovation and firm performance in the Taiwanese hotel industry.