What explains the lack of monetary policy influence on bank holding companies?

In this paper, we investigate how monetary policy innovations affect the equity returns of bank holding companies (BHCs). We also examine bank characteristics to determine what explains the cross-sectional and time-series variation in the returns' sensitivity. Similar to non-financial firms, we find that only unanticipated components affect bank equity returns; however, this effect is absent in the second half of our sample period. Smaller, less liquid banks have higher sensitivity; a higher ratio of time deposits to total deposits reduces this sensitivity. A higher ratio of non-interest income to total income also reduces this sensitivity, while capital-constrained banks have a higher sensitivity to monetary policy innovations. We argue that a higher dependence on non-interest income and the use of interest rate derivatives together may explain the disappearing influence of monetary policy on these BHCs.     

Private placement,share prices,volume and financial crisis: An emerging market study

Firms are increasingly resorting to private placements in recent years, yet there is no published study of emerging markets. There is a unique opportunity to study this behavior during a severe financial crisis, when firms resorted to private placements to recover financially distressed firms. Our analysis using data over fifteen years shows (a) a significant 2–3% positive share price reaction, affirming asymmetric information effect, (b) a significant volume activity, and (c) the price impact is different across a period of a major financial crisis. If the proceeds from placement are earmarked for investment, share price is negatively (positively) correlated during the crisis (non-crisis) periods. Our finding on regulation is inconsistent with prior reports in developed markets: this is explained by the stricter restrictions on trading of private issues in emerging market. These results provide modest new contributions to the literature on private placements.     

Charity Care by Non-profit Hospitals: The Price of Tax-exempt Debt

In this paper, we study the effects of tax-exempt debt on the supply of charity care of non-profit hospitals. We hypothesize that hospitals using tax-exempt rather than taxable debt are forced to provide higher levels of charity care as a condition for gaining access to the tax-exempt market. The study uses a panel of 189 California non-profit hospitals. Hospital uncompensated care is regressed on the level of uncompensated care by other hospitals in the market, lagged values of tax-exempt and taxable debt and other control variables.The magnitude of the tax-exempt bond subsidy has a positive effect on the flow of charity care and varies positively with the charity care provided by other hospitals. We conclude that subsidies provided by tax-exempt debt are an effective media to increase the supply of charity care by hospitals. Regulators can use competition between non-profit hospitals in order to enforce the desired behavior.     

Ethnicity and homophily effects in US M&As

We show that ethnic diversity of CEOs of merging firms has been increasing and report evidence of ethnic homophily effect in M&As transactions. Specifically, M&As perform better when the CEOs of the merging firms share a common ethnic background. In a sample of 444 US mergers completed between 2000 and 2018, we find that ethnic homophily improves the probability of deal completion. Furthermore, we report mild variation of performance across ethnic groups. White CEOs exhibit better postmerger performance while Asian CEOs instigate a better market reaction (announcement return). Subsequent analyses show that White CEOs tend to have longer tenure and longer experience while Asian CEOs tend to be more transparent. We discuss our findings in light of a few extant theories and show that our findings are robust to several additional tests including instrumental variables, Heckman's selection bias correction, and several variations in the model specifications and definitions of key variables.     

Modeling the Factors Affecting Organic or Local Cucumber Purchasing Motivations in Northern Iran

This article has attempted to examine the impact of motivation on the purchasing and represents a model for organic or local cucumbers buying dimensions. Data were collected by a sample of 300 people in two northern provinces of Iran during 7 months and were tested using structural equation modeling (SEM) technique. Results indicate that not using pesticides, preserving people’s health, conservation, better taste, and region of origin of organic or local cucumbers have significant positive impacts on purchasing dimensions and persistence has no significant effect on purchasing dimensions.     

Effect of Consumption Values on Women’s Choice Behavior Toward Organic Foods: The Case of Organic Yogurt in Iran

The purpose of this study is to examine the effects of consumption values (i.e., functional value, social value, emotional value, conditional value, epistemic value, environmental value, and health value) on women’s choice behavior toward organic yogurt. Structural equation modeling is used to assess data collected by a questionnaire survey. The results indicate that functional value–quality, functional value–taste, and functional value–price; conditional value; epistemic value; and health value have positive effects on choosing organic yogurt by women, and social value, emotional value, and environmental value have no effects on the subject. Among variables, epistemic value and health value have the highest impact on consumer choice behavior toward organic yogurt. So this study concludes that the main influence factors on choice behavior regarding organic yogurt are epistemic value and health value. In fact, consumers have high knowledge about organic yogurt benefits related to their health.     

Advertising in Malaysia—A Cultural Perspective

This article outlines, through a cultural perspective, one possible approach for advertising in Malaysia. The basis for this approach is derived from an analysis of the standardized and localized schools of advertising. Within the study, a Canadian example is used to shed light on the implications for businesses around the world for advertising in Malaysia. In addition, a comparison is drawn between Saudi Arabian and Malaysian cultures to determine if an advertising strategy used in other Islamic countries should be adopted in Malaysia. The findings suggest that although the majority of the citizens of Malaysia are Muslim, Malaysia's heterogeneous culture does not encourage a strict adherence to Islamic principles. The implication for Western businesses advertising in Malaysia is that a compromise be struck between a standardized and a localized advertising strategy.     

Sterilisation and Monetary Control by the GCC Member Countries

The prevailing dollar peg of the Gulf Cooperation Council (GCC) countries and the absence of any significant current and capital account restrictions led some to believe that these countries have lost monetary independence. However, the paper presents evidence that interest rates of the GCC countries did not converge to the interest rates of the US implying that the assets of the GCC countries are not perfect substitutes to the US assets. This imperfect asset substitutability has allowed the GCC countries to manoeuvre their monetary policies and the central banks of the GCC countries have had some control over their money growth rates by sterilising the changes in international reserves. Results indicate that the monetary authorities of these countries used domestic credit policy to attain some domestic policy objective while engaging in sterilised foreign exchange intervention. This result implies that the proposed GCC central bank should be able to maintain the monetary independence as a group and can reap the benefit of monetary efficiency of the proposed Gulf Monetary Union.     

Personality and balanced psychological contracts: The mediating roles of epistemic curiosity and rule‐following behavior

This study extends prior research on the relationships between personality constructs and types of psychological contracts by exploring how the Big Five traits predict balanced psychological contracts. Further, we determine whether epistemic curiosity and rule‐following behavior are key mediators of the proposed relationships. We tested our proposed hypotheses using three‐wave time‐lagged data from 469 respondents. The results indicated that openness to experience was positively associated and both conscientiousness and neuroticism were negatively associated with balanced contracts. Extraversion and agreeableness were not associated with balanced contracts. We also established the mediating role of epistemic curiosity in the relationships between personality traits and balanced contracts, but there was no support for the mediating role of rule‐following behavior in the present study. These findings have important implications for managers and organizations in terms of selecting the right person for a job (person‐job fit) and ensuring employee retention (person‐organization fit), hence having a bottom‐line effect on firm performance. Future research directions are also discussed.     

Who Says There is an Intention–Behaviour Gap? Assessing the Empirical Evidence of an Intention–Behaviour Gap in Ethical Consumption

The theories of reasoned action and planned behaviour (TRA/TPB) have fundamentally changed the view that attitudes directly translate into behaviour by introducing intentions as a crucial intervening stage. Much research across numerous ethical contexts has drawn on these theories to offer a better understanding of how consumers form intentions to act in an ethical way. Persistently, researchers have suggested and discussed the existence of an intention–behaviour gap in ethical consumption. Yet, the factors that influence the extent of this gap and its magnitude have not been systematically examined. We, therefore, contribute to the debate on the intention–behaviour gap by reviewing the empirical TRA/TPB studies that have assessed both intention and behaviour in ethical contexts. The findings from our review show that few studies assessed the intention–behaviour relationship and as a result, there is limited empirical evidence to date to quantify more accurately the intention–behaviour gap in ethical consumption. Our second contribution aims to provide an empirical case study which assesses the magnitude of the intention–behaviour gap in the context of avoidance of sweatshop clothing and to assess the roles of planning and actual behavioural control in potentially reducing the intention–behaviour gap. The findings of our case study suggest that there is indeed a large gap between intention and behaviour, and we conclude by calling for more empirical longitudinal studies to assess the complex nature of the relationship between intention and behaviour.