Collectivist values for learning in organizational relationships in China: the role of trust and vertical coordination

Partners must engage in integrative interaction in order to combine diverse expertise and experiences into effective learning. Results from 103 pairs of customer and supplier organizations in China indicate that trust and vertical coordination are useful ways to characterize this integrative interaction and together they promote learning. Structural equation analysis suggests that collectivist but not individualist values are important foundations for integrative interaction between partners that result in learning. These findings were interpreted as reaffirming the value of effective relationships for coordination between partners and suggesting that collectivist values can be a source of effective organizational relationships.     

Resource‐seeking agglomeration: a study of market entry in the lodging industry

We analyze whether firms prefer collocating with incumbent firms when choosing among markets to enter, highlighting the role of resource‐seeking as a motivation for collocation. We propose that entrants will locate near others possessing resources that can spill over, but will avoid locations where existing firms will exploit spillovers without contributing. To test these propositions, we analyze the location decisions of 570 new hotels in Texas between 1992 and 2000. We find that hotels are attracted to markets with branded upscale hotels. Further, we find that owners of upscale hotels avoid markets with hotels without similar resources. Copyright © 2004 John Wiley & Sons, Ltd.     

Ownership structure and the pricing of discretionary accruals in Japan

This paper examines the valuation effect of discretionary accruals for Japanese firms, taking into account the book value of equity. Consistent with US evidence, the Japanese market prices discretionary accruals, indicating that discretionary accruals enhance the value relevance of reported earnings. This value relevance is lower for cross-held firms, consistent with the view that cross-business shareholding aggravates tunneling or managerial opportunism through discretionary accounting choices. On the other hand, foreign shareholding and bond financing provide effective monitoring on managerial discretion of profit firms to enhance the valuation of discretionary accruals.     

Does corporate diversification reduce value in high technology firms?

We find that firm value is reduced via industrial diversification and this reduction in value depends upon a firm’s technology intensity. We consider that asymmetric information problems are more severe in technology intensive industries and find that high tech industry firms present distinctly larger value reduction when compared to low tech industry firms. The negative valuation effect is greater for firms that have a relatively larger amount of intangible assets and greater R&D capital. We determine that our findings are robust to different estimation methods and alternative excess value measures.     

The rise of defensive engineering: how personal liability considerations impact decision-making

Abstract

Based on a survey of Australian engineers (n = 275) this paper examines the impact of personal liability considerations on engineering decision-making. Almost all respondents who make high-stakes decisions saw questions of liability as having both positive (90%) and negative (87%) impacts. Our analysis shows that awareness of personal liability acts to focus the attention of many engineers on the moral dimension of their work. However, it also encourages more expensive decision-making, inhibition of innovation and professional paralysis. We argue that while personal legal liability is a legitimate way to focus engineers’ attention on the potential impact of their work, a problem arises when decision-makers are held responsible for disasters over which they had little control. The focus then shifts to ‘defensive engineering’ practices that are aimed at limiting individual liability rather than disaster prevention. Legal processes that are seen to unfairly allocate blame do not encourage practices that support future disaster prevention.     

Sociology,risk and the environment: a material-semiotic approach

Abstract

Sociology has made significant contributions to the conceptualisation of risk and critique of technical risk analysis. It has, however, unintentionally reinforced the division of labour between the natural/technical and social sciences in risk analysis. This paper argues that the problem with conceptualisations of risk is not a misplaced emphasis on calculation. Rather, it is that we have not adequately dealt with ontological distinctions implicit in both sociological and technical work on risk between material or objective risks and our socially mediated understandings and interpretations of those risks. While acknowledging that risks are simultaneously social and technical, sociologists have not, in practice, provided the conceptual and methodological tools to apprehend risk in a less dualistic manner. This limits our ability both to analyse actors and processes outside the social domain and to explore the recursive relationships between risk calculus, social action and the material outcomes of risk. In response, this paper develops a material-semiotic conceptualisation of risk and provides an assessment of its relevance to more sociologically informed risk governance. It introduces the ideas of co-constitution, emergent entities and enactment as instruments for reconciling the material and social worlds in a sociological study of risk. It further illustrates the application of a material-semiotic approach using these concepts in the nuclear industry. In deconstructing social–material dualisms in the sociology of risk, this paper argues that a material-semiotic conceptualisation of risk enables both technical and social perspectives on risk not only to coexist but to collaborate, widening the scope for interdisciplinary research.     

The Effects of Oil Price on the Korean Economy: A Global VAR Approach

This article empirically explores the effects of oil price on the Korean economy using a Global VAR model. First, we evaluate the average connectedness of oil price with the Korean domestic variables over the precrisis period. We then investigate the time-varying contribution of oil price to the Korean financial and real sectors during and after the global financial crisis through recursive estimation. It is found that the contribution of oil price becomes very large in the case of real exports, equity prices, and real output, but plays a much less prevalent role in the remaining cases. In the meantime, the time-varying contribution of oil price to the Korean economy has not changed during and after the global financial crisis. Interestingly, we find that the Korean economy is affected mostly by overseas financial conditions in the short-term but it becomes more susceptible to oil price fluctuations in the long run, suggesting that Korea’s reliance on energy imports leaves the economy exposed to volatility in energy prices.     

The Landscape of Economic Growth: Do Middle-Income Countries Differ?

We review the growth experience of middle-income countries. Economic factors associated with growth appear to differ between middle-income and other countries. The efficiency of the financial system is importantly related to the growth rate in low- and middle-income countries, but appears to matter less as one moves up the income scale. Demographic variables also matter importantly in low-income countries. In middle-income countries, in contrast, measures of the financial system no longer appear to matter as importantly, as if inefficiencies in banking and financial systems are no longer as binding a constraint as at earlier stages of financial development; nor are demographic variables as important as before. At this point, other variables gain a growing role: these include whether the country experiences a banking or currency crisis, the extent of non-foreign direct investment capital inflows, and government debt as a share of gross domestic product.     

Value relevance of proportionate consolidation versus the equity method: Evidence from Hong Kong

Whether proportionate consolidation (PC) or the equity method (EM) provides more informative financial statements is a controversial issue. This study uses data from listed companies in Hong Kong to investigate the value relevance of the EM compared with PC during 2005–2008 when the local word-for-word equivalent HKAS 31 offered the same options. The results of this study provide evidence that PC does not offer higher value relevance than the EM. PC’s horizontal aggregation of a portion of the operations, assets and liabilities of the jointly controlled entities with those of the venturer is less informative to investors than the EM’s vertical aggregation.     

Political patronage and analysts’ forecast precision

We test whether the channel by which the government plays the role of political patron to selected firms influences analysts’ forecast precision in Malaysia. Correcting for analysts’ self-selection bias, we find a negative relation between analysts’ forecast errors and the social dimension of political patronage, as proxied by government-controlled institutional ownership. The reverse is found for the economic dimension of political patronage, as proxied by the percentage shareholding of government-linked corporations. We find no evidence that the personal dimension of political patronage influences analysts’ forecast precision.