Left-side Relatively Weak Increases in Risk and Their Comparative Statics

This paper proposes a new concept, a left-side relatively weak increase in risk (L-RWIR) order, that extends the definition of a relatively weak increase in risk (RWIR) order. We show that, for the class of linear payoffs, one can obtain an appealing comparative statics result for L-RWIR shifts imposing additional restrictions on risk preferences of a risk-averse decision maker.JEL classification: D81.revised version received October 10, 2003Acknowledgements The authors would like to thank an anonymous referee for insightful comments and useful suggestions.     

Limited participation and the closed-end fund discount

In this paper, we present economic forces that affect the closed-end fund share price using a simple two-period model with limited participation. We characterize three economic forces: management fee, principal-agent problem effect and diversification benefit effect. The role of the management fee is consistent with recent studies by Ross [Ross S., 2002. Neoclassical finance, alternative finance and the closed end fund puzzle. European Financial Management 8, 129–137, Ross, S., 2002. A neoclassical look at behavioral finance: closed end funds. The Princeton lectures in finance III] and findings of various empirical studies [e.g., Kumar, R., Noronha, G.M., 1992. A re-examination of the relationship between closed-end fund discounts and expenses. Journal of Financial Research 15(2) Summer, 139–147; Russel, P.S., 2005. Closed-end fund pricing: The puzzle, the explanations, and some new evidence, Journal of Business and Economic Studies 11(1), 34–49; Gemmill, G., Thomas, D.C., 2002. Noise trading, costly arbitrage, and asset prices: Evidence from closed end funds. Journal of Finance 57(6), 2571–2594]. The model’s principal-agent problem effect is consistent with empirical findings by Brickley et al. [Brickley, James, Steven Manaster, Schallheim, James, 1991. The tax-timing option and the discounts on closed-end investment companies. Journal of Business 64, 287–312] of positive relation between the fund discount and the average variance of the constituent assets in the fund portfolio. In addition, it provides a theoretical framework for empirical studies, which examine the role of agency costs [Barclay, Michael J., Clifford G. Holderness, Jeffrey Pontiff, 1993. Private benefits from block ownership and discounts on closed-end funds. Journal of Financial Economics 33, 263–291] and compensation contracts [Coles, J., Suay, J., Woodbury, D., 2000. Fund advisor compensation in closed-end funds. Journal of Finance 55 (3), 1385–1414; Deli, Daniel N., 2002. Mutual fund advisory contracts: An empirical Investigation. Journal of Finance 57(1), 109–133] on the behavior of fund managers and fund discounts. The model’s diversification benefit effect supports the result in [Bonser-Neal C., Brauer,G., Neal, R.., Wheatley, S., 1990. International investment restrictions and closed-end country fund prices. Journal of Finance 45, 523–547] that announcement of financial market liberalization is associated with a decrease in the fund premium. It also supports the findings of [Kumar, R., Noronha, G.M., 1992. A re-examination of the relationship between closed-end fund discounts and expenses. Journal of Financial Research 15(2) Summer, 139–147; Chay, J.B., Trzcinka, Charles A., 1999. Managerial performance and the cross-sectional pricing of closed-end funds. Journal of Financial Economics 52, 379–408] of a positive relation between current premium and the risk-adjusted return over the following year.     

Can Pokémon GO catch brands? The fit effect of game characters and brands on efficacy of brand communications

Given the recent popularity of augmented reality (AR) games, such as Pokémon GO, this study explores the congruence effect of game characters and brands on brand evaluations and the underlying mechanisms of the effect. Prior gaming experience and motivations are taken into account. An experiment reveals that inexperienced gamers are likely to have more favorable evaluations of the target brands when the images of game characters match the brand images, whereas these effects disappear for experienced gamers. Furthermore, the research demonstrates that experienced gamers are more likely to hold game-specific motivations than the inexperienced, while inexperienced gamers are motivated more by social interaction for playing AR games. Lastly, a mediation analysis reveals that social interaction-related motivation mediates inexperienced gamers’ preference of character–brand congruence. This study sheds light upon how AR games can be utilized by brand communicators.     

Corporate association strategies and consumer responses: The relative effectiveness of CA versus CSR communication strategy by industry type

Given the importance of communication in the realm of corporate associations, this study analyzes the roles that communication strategies play in the formation of corporate associations. The study examines (1) whether particular types of associations (corporate ability or corporate social responsibility associations) can be developed through CA- or CSR-based communication strategies, and (2) the relative effectiveness of these two association types at amplifying favorable consumer responses across three different industries (consumable goods, durable goods, and stigmatized goods). An experiment was conducted to test the proposed model with six Fortune 500 companies. The results demonstrate that communication strategies can effectively facilitate a particular type of association. Differing levels of association effectiveness were found within each industry. For the consumable goods industry, CA associations are found to be more effective than CSR associations. For the durable goods industry, CSR associations are more influential at enhancing consumer attitudes and purchase intent than CA associations, while CA associations have a larger impact on supportive communication intent. In the case of the stigmatized industry, CSR associations play a determinant role in fostering positive consumer responses. This study provides managers and communication specialists with more concrete guidance for choosing a particular corporate positioning and communication strategy.     

Loyalty toward online food delivery service: the role of e-service quality and food quality

This study assesses the direct influence of food quality and e-service quality on customer loyalty toward online food delivery (OFD) service and its indirect influence through the mediation of customer satisfaction and perceived value. This study uses a survey of 405 OFD service customers from Bandung, Indonesia. By applying variance-based partial least squares to evaluate the proposed model, this study confirms the direct effect of food quality on online loyalty, but not e-service quality. Further, this study discloses the partial mediation role of customer satisfaction and perceived value on the relationship between both food quality and e-service quality on online loyalty toward OFD services.     

Consumer Responses to the Food Industry’s Proactive and Passive Environmental CSR,Factoring in Price as CSR Tradeoff

This study explores social enterprises’ strategies for addressing mission drift. Relying on an inductive comparative case study of two Italian social enterprises, we show how stakeholder engagement combined with social accounting can successfully support a social venture to re-balance its positioning between wealth generation and social value creation. Indeed, stakeholder engagement helps the internal actors of a social enterprise to rationalize and embody pro-social values previously abandoned, while social accounting reinforces this embodiment process by showing the reintroduced social commitment of the social enterprise to external audiences. Conversely, strategies focused only on social accounting and without significant engagement of external stakeholders prove to be unsuccessful in counterbalancing mission drift because they fail to activate the necessary process of internal re-introduction and operationalization of pro-social values and objectives.