Matter over mind: When specific asset investment affects calculative trust in supply chain partnership

This study, using the concept of trust defined as calculative, risk-related, and relationship-based, examines the relationships between bilateral specific asset investments and after-investing trust. The findings indicate that a firm's trust in their supply chain partner is highly associated with both sides' specific asset investments. It also signifies that the replaceability of a respondent firm moderates the positive relationship between the partner's specific asset investment and trust. Our data has proven that the calculative-based trust theory has better explaining power with the transaction cost analysis (TCA) variables than the knowledge-based trust theory.     

Contracts without memory in multiperiod agency models

Settings are considered in which optimal multiperiod contracts can have no memory, i.e., where second period payments do not need to depend on first period outcomes. If contracts have no memory, a repeated agency game can be played myopically; there are no gains to long-term relationships. Conditions on preferences for a no memory contract are presented. In an agency game with moral hazard on the act selection, preference separability and domain additivity imply the existence of a no memory contract. In a setting without moral hazard but with asymmetric information on the outcome, domain additivity implies no memory.     

Investment financing: evidence from Korea

This study examines the relative importance of various forms of capital in financing investments by Korean firms. Our results from the seemingly unrelated regression (SUR) method indicate that, unlike U.S. firms, Korean firms rely substantially on cash holdings to finance investments. These results also suggest that Korean firms use long‐term debt more actively than equity issuance to finance investments. Subgroup analyses show that large firms and Chaebol‐affiliated firms use more long‐term debt but less equity issuance than comparison firms do, suggesting that debt capacity allows firms to reduce the use of equity issuance. However, there is little evidence that financing decisions are driven by information asymmetry. The results from the quantile regression (QR) method suggest that Korean firms tend to use debt capital more than they do equity capital at low and medium levels of investments, while their reliance on equity capital increases at high levels of investments.     

Factors Affecting New Product Success: Cross-Country Comparisons

Although considerable effort has been devoted to identifying the factors that contribute to new product success and failure, plenty of work remains to be done in this area. For example, many studies of this subject focus on companies in specific parts of the world (in particular, North America, Europe, and Japan). It remains to be seen whether the findings from these studies apply to the new product development (NPD) efforts of companies in other regions, let alone on a global basis. Sanjay Mishra, Dongwook Kim, and Dae Hoon Lee address this issue in a study of the factors that contribute to the success or failure of NPD efforts in South Korean firms. To explore the question of whether a global set of success factors can be identified, they compare their findings with those of similar studies conducted in Canada and China. Classifying these countries in terms of stages of economic development (with China and Canada at opposite extremes and Korea in the middle), they expect to find the greatest dissimilarities in their comparisons of China and Canada. Marketing managers from 144 Korean firms provided in formation about 288 successful and unsuccessful products. Their responses indicate that the factors most closely related to new product outcomes in Korea are market intelligence, product-firm compatibility, the nature of the new product idea (for example, whether the product idea was market derived, whether the product specifications were clearly defined by the marketplace), launch effort, and general characteristics of the new product venture (such as the product's innovativeness to the market and its technical complexity). Several of these factors were emphasized in studies of Canadian and Chinese NPD success, though respondents to those studies also highlighted the importance of the product offering and proficiency of formal NPD activities. Contrary to expectations, China and Canada show the greatest similarity among the three countries studied, in terms of the relative importance of the various NPD success factors. On the other hand, China and Korea are more similar in terms of the effects of the variables studied. In other words, if a variable is related to new product failure in Korea, that variable is most likely also related to failure in China. Although some similarities are evident among all three countries, the findings in this study do not point toward a single, global formula for NPD success.     

Examining the indirect impact of showroom entertainment on hourly slot gaming volume: The case of a Las Vegas hotel-casino

With the advent of the destination casino resort featuring multifaceted entertainment and convention venues in the gaming industry, researchers have attempted to estimate the indirect gaming contributions of non-gaming casino amenities such as showroom entertainment and restaurants. The daily data of aggregate gaming volumes analyzed in previous gaming research, however, do not allow exploring transient gaming volumes associated with casino amenities during a much narrower range of time periods (i.e., hourly). The current investigation addressed this limitation by examining the relationship between showroom headcount and hourly slot gaming volume for the time period that fell adjacent to the show's start and end times. Based on the time-series regression analysis of daily data from a Las Vegas Strip hotel-casino, the current study found a positive and statistically significant effect of showroom headcounts on hourly slot volume at 6 p.m., 9 p.m. and 10 p.m. The estimated incremental slot revenue per paid showroom attendee, however, was financially immaterial. Considering major investments in showroom entertainment at many casinos, the current study will help casino operators evaluate the showroom's return-on-investment.     

Public Disclosures in the Presence of Suppliers and Competitors

Firms’ reluctance at times to publicly disclose financial information is often attributed to concern that the information may be used against them by self‐interested outside parties. These outside parties may interact with the firm in the horizontal realm (e.g., retail competitors) or in the vertical arena (e.g., wholesale suppliers). This article is built on the premise that fully understanding the strategic consequences of disclosure requires joint consideration of horizontal and vertical relationships. When both rivals and suppliers are accounted for, we demonstrate that (i) lower intra‐industry correlation in product demand favors disclosure, with the precise correlation‐cutoff dependent on the firm's use of input suppliers; and (ii) the more a firm relies on input suppliers with pricing power, the less attractive is disclosure.     

How CSR serves as a preventive mechanism for coping with dysfunctional customer behavior

Service Business - Based on empirical results involving 237 frontline service employees (FSEs) of a South Korean insurance company, this study reveals how FSEs’ views of their company’s...     

A comparative analysis of the change in R&D efficiency: a case of R&D leaders in the technology industry

This paper measures the cumulative change in research and development (R&D) efficiency of globally leading R&D companies in the technology industry. We use Data Envelopment Analysis /Malmquist index to analyse 49 such companies. The change in R&D efficiency is analysed by decomposing the Malmquist index into ‘catch-up’ and ‘frontier shift’ indices, and by comparing cumulative indices to those at the starting period. Those cumulative indices are obtained at both a firm and an industry level. Results indicate that the overall R&D efficiency of these globally leading R&D companies declined slightly during the period 2007–2013. At a firm level, this study determines in detail how the trend of each firm in R&D activities differs from other companies.     

Characterization of unknown unknowns using separation principles in case study on Deepwater Horizon oil spill

Unidentified risks, also known as unknown unknowns, have traditionally been underemphasized by risk management. Most unknown unknowns are believed to be impossible to find or imagine in advance. But this study reveals that many are not truly unidentifiable. This study develops a model using separation principles of the Theory of Inventive Problem Solving (whose Russian acronym is TRIZ) to explain the mechanism that makes some risks hard to find in advance and show potential areas for identifying hidden risks. The separation principles used in the model are separation by time, separation by space, separation upon condition, separation between parts and whole, and separation by perspective. It shows that some risks are hard to identify because of hidden assumptions and illustrates how separation principles can be used to formulate assumptions behind what is already known, show how the assumptions can be broken, and thus identify hidden risks. A case study illustrates how the model can be applied to the Deepwater Horizon oil spill and explains why some risks in the oil rig, which were identified after the incident, were not identified in advance.