CEO Optimism and the Credibility of Open-Market Stock Repurchase Announcements

Given their low-cost and low level of commitment, open-market stock repurchase announcements are often viewed by the market with a degree of skepticism, leading to a weak initial market reaction followed by positive stock price drifts. The authors argue that the repurchase announcements made by optimistic CEOs should be more credible than those made by nonoptimistic CEOs. Our results show that optimistic CEOs are more likely to actually buy back their shares after the announcements and the abnormal returns following repurchase announcements are larger for optimistic CEOs. This evidence suggests that CEO optimism is an important factor that the market seems to overlook while evaluating the credibility of open-market repurchase announcements. Our main contribution is to link one of the most important managerial traits, optimism, to the open-market repurchases.     

The dynamic impact of macroeconomic factors on initial public offerings: evidence from time-series analysis

This article examines the explanatory power and the dynamic impact of macroeconomic conditions on Initial Public Offering (IPO) activities in US during the period from 1970 to 2005. Applying time-series econometric techniques, we find the existence of long-run equilibrium relationships between IPO activities and selected macroeconomic variables. Stock market performance and volatility are shown to play the most important role in the timing of IPOs. The Fed funds rate and the 10 year US Treasury Bond (TB) yield play a comparable role in determining the amount of proceeds raised in the IPOs. There also exist different short-run dynamic adjustment mechanisms between IPOs and macroeconomic factors towards the long run equilibrium path and they are mostly completed within the period of 6 months to 1 year. The results have some useful implications for forecasting IPO activities.     

Comparative study on the relationship between just-in-time production practices and operational performance in manufacturing plants

This study analyzes the differences in approaching JIT production across countries in order to identify alternative paths to high manufacturing performance. We applied ANOVA and regression techniques to the database of High Performance Manufacturing Project to examine the similarities and differences across countries in JIT implementation and the effect of JIT production practices on operational performance. The results indicated that JIT production practices were implemented in different ways across the countries. We found that the relationship between JIT production practices and plant performance is contingent on the national context and infrastructure practices in quality and workforce management. JIT delivery by suppliers, JIT layout, and setup time reduction were found to be the most effective approaches to improve cost, delivery, and flexibility. This study highlights the important role of shop-floor communication and information sharing, which should be focused for maximizing the benefits of JIT implementation.     

Quality management practices and competitive performance: Empirical evidence from Japanese manufacturing companies

This paper presents the results of an empirical study on the relationship between quality management practices and competitive performance in Japanese manufacturing companies. The data was gathered from two surveys including the common sample of twenty-seven Japanese manufacturing companies in the 1990s and the 2000s. Statistical techniques are used to compare the degree of implementation of the eleven quality management practices and their impact on different dimensions of competitive performance between two periods. Findings of this study highlight the stability and consistency of the Japanese quality management, which can be used as one of the strategic weapons for maintaining competitive advantage of Japanese manufacturing companies.     

Growth, volatility and stabilisation policy in a DSGE model with nominal rigidities and learning-by-doing

The paper aims to analyse the question of how cyclical fluctuations might affect long run growth. The analysis is based on a dynamic stochastic general equilibrium model for an imperfectly competitive economy with fully optimising agents. The model is characterized with nominal rigidities, an endogenous technology, and multiple shocks. It predicts either a negative or positive relationship between short run volatility and long run growth depending on the source of shocks and the reaction of the central bank. The model also shows that, even when the negative relationship exits the policy that is designed to stabilise short run volatility may either increase or decrease growth depending on the source of shocks.     

The price of variance risk

Between 1996 and 2014, it was costless on average to hedge news about future variance at horizons ranging from 1 quarter to 14 years. Only unexpected, transitory realized variance was significantly priced. These results present a challenge to many structural models of the variance risk premium, such as the intertemporal CAPM and recent models with Epstein–Zin preferences and long-run risks. The results are also difficult to reconcile with macro models in which volatility affects investment decisions. At the same time, the data allows us to distinguish between different disaster models; a model in which the stock market has a time-varying exposure to disasters and investors have power utility fits the major features of the variance term structure.     

Attitudes Toward Economic Risk and Occupational Choice

This paper examines the effects of attitudes toward economic risk on occupational choice. Workers with a more favourable disposition toward economic risk have a higher probability of being employed in the more prestigious, high‐paying Professional and Administrative occupations. Potential biases associated with omitted genetic and family background factors are considered. The marked differential in attitudes toward economic risk between males and females, however, makes only a minor contribution to the considerable occupational segregation on the basis of gender in the contemporary Australian labor market.     

Vietnam in transition: SMEs and the necessitating environment for entrepreneurship development

A transitional economy has been characterized as experiencing a large amount of economic and social change. SMEs can be considered as the vehicle for entrepreneurship development in such a context. The purpose of this paper is to further the investigation of the favourability of the transitional environment on SMEs and entrepreneurship in Vietnam. Using a new approach, we analyse the transitional economy discourse via examining government policies, international organization reports and academic articles on Vietnam. Our findings suggest that, in Vietnam, compared to an overall normative framework developed from a wide literature review, the settings generally support a vibrant transitional entrepreneurship development and SMEs. However, more needs to be done to build up favourable sociocultural setting and effective business support systems in the country. Implications for the relevant stakeholders and suggestions for future research in the East Asian and Central and Eastern Europe regions are also provided.     

Information control in the hold‐up problem

We study the use of information control to mitigate hold‐up risks. We identify a distinction between asymmetric information that creates an ex ante investment incentive and asymmetric information that causes ex post inefficiency, which then allows ex post inefficiency to be eliminated without compromising the ex ante investment incentive. We characterize the properties of the optimal information structure and the payoffs and welfare achievable with information control in the presence of hold‐up risks.