Reverse Transfer Effect of Celebrity-Product Congruence on the Celebrity's Perceived Credibility

In contrast with traditional celebrity endorsement research, this study examines the effect of celebrity advertisement on the celebrity himself/herself, that is, a reverse transfer effect, in terms of the celebrity's perceived attractiveness, trustworthiness, and expertise. Online questionnaires were conducted for sport and film celebrities using an identical 2 (Korean vs. non-Korean) X 3 (very congruent, moderately incongruent, very incongruent) design. The results show that a celebrity's perceived expertise, trustworthiness, and attractiveness were significantly decreased when the celebrity-product congruence was low, whereas no significant effects were found when the congruence level was high. Theoretical and managerial implications as well as directions for future research are discussed.     

Yield curve in an estimated nonlinear macro model

This paper estimates a sticky price macro model with US macro and term structure data using Bayesian methods. The model is solved by a nonlinear method. The posterior distribution of the parameters in the model is found to be bi-modal. The degree of nominal rigidity is high at one mode (“sticky price mode”) but is low at the other mode (“flexible price mode”). I find that the degree of nominal rigidity is important for identifying macro shocks that affect the yield curve. When prices are more flexible, a slowly varying inflation target of the central bank is the main driver of the overall level of the yield curve by changing long-run inflation expectations. In contrast, when prices are more sticky, a highly persistent markup shock is the main driver. The posterior probability of each mode is sensitive to the use of observed proxies for inflation expectations. Ignoring additional information from survey data on inflation expectations significantly reduces the posterior probability of the flexible price mode. Incorporating this additional information suggests that yield curve fluctuations can be better understood by focusing on the flexible price mode. Considering nonlinearities of the model solution also increases the posterior probability of the flexible price mode, although to a lesser degree than using survey data information.     

Market selection with endogenous information revelation

This paper uses the dynamic general equilibrium model developed by Mailath and Sandroni (2003) but allows information revelation to be determined endogenously. The paper establishes sufficient conditions on the exogenous information arrival process that ensure that an investor who receives unique information infinitely often drives out an investor who receives unique information only finitely often.     

The Effect of IPO Risks on Auditors’ Decisions: Auditor Designation Case

This study examines the effect of audit risks in the Korean initial public offering (IPO) market on the designated auditors’ decisions. The Korean External Audit Act requires firms to switch from incumbent to new auditors designated by the Securities and Futures Commission after the firm announces a future IPO. This study shows the effects of audit risks by examining if the quality of reported earnings and audit fees significantly differs between IPO‐eligible and IPO‐ineligible firms. Empirical tests first show that discretionary accruals are significantly lower for IPO‐ineligible firms than for IPO‐eligible firms in both the IPO designation period and the following review period. We interpret this result to mean that designated auditors evaluate the IPO‐ineligible (and eventually failed) firms’ listing possibility as low. Second, audit fees are higher for IPO‐ineligible firms in the auditor designation period. This reflects the fact that designated auditors are exposed to future audit risks associated with firms’ post‐IPO financial market troubles if IPO‐ineligible firms attempt to go public. Our study contributes to IPO‐related research by showing the effects of auditors’ risk evaluation on discretionary accruals and audit fees. This study also contributes to accounting policymaking regarding auditor independence.     

A tool for evaluating advertising concepts: Desirable characteristics as viewed by creative practitioners

Creativity is critical to advertising yet highly subjective. Testing to evaluate alternatives, if done, is often conducted at later stages that are expensive and wasteful. This study examined a set of characteristics about creativity from creative advertising practitioners. These characteristics were subjected to a three-part quantitative analysis that produced a model with four dimensions – novelty, utility, affect, and humor. Further testing showed that the model was useful in predicting the level of creativity in print advertisements, and the tool may be useful for the early evaluation of concepts.     

The role of U.S. naval power in the Asia‐pacific region: From regional protector to regional balancer

For more than four decades, U.S. engagement in the Asia‐Pacific was centered on two premises: a Cold War commitment to Asian security and the remarkable economic power of the U.S. The U.S. Navy provided a symbol of the United States’ commitment to protect its interests and those of its major Asian‐pacific allies. Despite the end of the Cold War, the security environment of the Asia‐Pacific region is still less changed and even a new threat of a regional naval arms race emerged in the 1990s. In this context, although forward deployments of U.S. military power in the Western Pacific have been scaled down, it is certain that the U.S. naval force will continue to play an important role as a key “regional balancer.” Amid the collapse of the Soviet Union and in the post‐Cold War era, the U.S. has still emphasized the maintenance of a U.S. forward‐deployed presence and strong defense alliances with U.S. allies in order to prevent the emergence of regional hegemonic powers and to contribute to regional stability as well as improve U.S. economic interests. Moreover, in the face of a multitude of threats from state and non‐state actors, the U.S. Navy is increasingly focused on and driven by the demands of peacetime and crisis forward presence.     

Thanatourism or peace tourism: perceived value at a North Korean resort from an indigenous perspective

This paper examines the underlying factors that affected perceived value among South Korean tourists who visited the North Korean Mt Kumgang resort. Results identified emotional, functional and economic values as core elements that directly affected guest satisfaction, which influenced intentions to recommend and revisit. Seen as a peace tourism site when the Sunshine Policy of rapprochement guided inter‐Korean strategy, we argue that the resort project is a heterotopia of comparison combining idealized cultural and contradictory political spaces in one place. Understanding this needs Korean ideas that lead to a thanatourism with an indigenous perspective, which is applicable to other non‐Western thanatourism‐like sites. Copyright © 2011 John Wiley & Sons, Ltd.     

New Auditors’ Decisions for Released Firms from the Mandatory Auditor Designation Rule: Evidence From South Korea

This study examines the effect of the mandatory designation rule on audit fees charged and audit hours rendered by auditors for firms released from the mandatory auditor designation rule in the Korean audit market. Under the mandatory auditor designation rule, which took effect in 1991, problematic firms are assigned new auditors by the Financial Supervisory Service. Previous studies suggest that this regulation positively affects the quality of audits by promoting auditor independence. Thus, this study hypothesises that firms that have been subjected to mandatory auditor designation improve the quality of their financial reporting, and that auditors hired after the mandatory designation period account for reduced audit risks when determining audit fees and audit hours. This study shows that audit fees and audit hours of firms released from the mandatory auditor designation rule are lower than those of other initial audit engagements. Taken together, this study's findings reinforce the notion that auditors’ perceptions of changes in audit risk yield corresponding changes in the audit fees they charge and audit hours they render.     

The effect of communication practice on deviance among Korean salespeople: The mediating role of intrinsic motivation

Previous research on salesperson behavior largely focused on positive and productive behavior and less on the negative side of the salesperson behavior. This research examines the effect of leader–member communication exchange on salesperson workplace deviance and the mediating role of trust and intrinsic motivation in this relationship. Data were collected from 469 salespeople in the Korean banking industry. Results of the structural equation model show that indirect and bi-directional communication between manager and salesperson decrease salesperson workplace deviance by increasing trust and motivation. However, communication frequency and mood have no significant effects on salesperson trust. Finally, motivation (achievement, status, and communion striving) plays a mediating role in the negative relationships between salesperson trust and his/her deviant behavior toward specific targets (organization, coworker, and customer).