Uncorrelated Emerging Equity Markets
Dr. Tulin Sener, State University of New York-New Paltz, NY
Most of the emerging markets recently have high returns with high volatility and low correlations with the World Index. They have high potential to improve the return and risk performance of global equity portfolios. In global investing, geographical factors remain dominant for emerging markets. This study shows that, at the outset of regional analysis, it is a good approach to find uncorrelated emerging market classes. Consistently, the uncorrelated emerging market classes justify the regional effects. Further, this approach contributes significantly to the regional analysis in several ways. The purpose of this study is to develop a strategy that might be helpful for global portfolio managers to find out uncorrelated country or region classes, as well as to evaluate the contributions of emerging market diversification to global equity investing. It is widely known that the diversification benefits to global equity investing are time variant over countries and are declining through time. For the global equity investors and managers of the new century, the controversial question is whether diversification benefits will continue. What is the relative importance of emerging markets for global diversification? Are geographical effects still important for global investing? Global diversification benefits are closely associated with the degree of world market integration and efficiency. The more segmented the markets are, the better the risk reduction and return enhancement benefits of global equity diversification will be. In a fully efficient and well-integrated global financial market, investing in the world market portfolio (i.e. the Global Equity Index) would be the optimal passive strategy for a global investor. However, recent literature indicates that global equity markets are neither entirely synchronized nor fully efficient, but integrating at a gradual pace and mostly in developed markets. Hence, benefits of active and efficient global equity diversification continue (Shao et al. 2002, Cooley et al. 2003, and Stultz 2005).
Cited by: 10
Lean Operations Management: Identifying and Bridging the Gap between Theory and Practice
Dr. Daniel L. Tracy, University of South Dakota, Vermillion, SD
Dr. John E. Knight, University of Tennessee at Martin, Martin, TN
The lean management philosophy is at the forefront of advances in the practice of operations management today. Lean principles meanwhile are built upon solid academic operations management theory. Both academicians and practitioners can benefit more fully from understanding both the practice of lean management and theory of operations management by combining them into an integrated management philosophy. This paper examines the gap between operations in academe and managers in the marketplace, the problems caused by that gap, and the potential benefits that could be realized by bridging that gap. In addition, effective avenues for bridging the gap are suggested for marketplace managers, faculty, authors, and publishers. Lean management is philosophically grounded in traditional operations management theory and models, and subsequently has been applied in today’s marketplace by non-academic practitioners in virtually every industry. Although much of the progress in lean management has come from the manufacturing sector, explosive growth in lean management is now occurring in the service sector as well. The driving force behind lean management is continuous process improvement through the elimination or reduction of non-value-added waste. “The driving force for waste elimination is improved customer value and increased profitability in the products and services offered by an organization.” (Burton, 2003, p. 99-100) Many different types of waste either originate or accumulate in any system with some waste more obvious than others. Table 1 illustrates eight different categories of non-value-added waste. (Burton, 2003, p. 99-100)
Cited by: 32
Banking Industry in Spain: Trends in Securitization of Loan Portfolios
Dr. Phani Tej Adidam, University of Nebraska at Omaha, Omaha, NE
In the current booming Spanish economy, banks are enjoying tremendous growth and profitability. Not only is the housing market growing exponentially, the small and medium businesses are also seeking higher amounts loans for their working capital needs. With such ever-increasing demands for loans, banks are looking for innovative methods of generating liquidity for not only offering loans to their current customers, but also to expand into more lucrative markets along the Mediterranean coast. Increasingly, banks in Spain are securitizing their loan portfolios. This paper investigates such trends, and compares the same to the banking industry in the European Union. Spain boasts one of the fastest growing economies in the European Union, and economic growth has steadily increased above the Eurozone average over the past decade. A construction and housing boom contributed to a decline in the unemployment rate and the rise in household wealth, creating overall positive economic conditions and tremendous growth opportunities for financial institutions. Demographic statistics indicate that 40.4% of the 44.7 million inhabitants in Spain are between the ages of 20-44. With a large young-adult population and growing immigrant population, banks have a sizeable target audience for origination of loans. They are prime candidates for loans as this population enters the workforce, establishes consumer credit, purchases a vehicle, and takes out a mortgage. The savings/investment rate in Spain is 10.4%, which has led to a decline in deposit funding, and an increased need for capital markets funding by financial institutions. While there is considerable debate over a projected recession versus a mild growth slowdown, most in-country experts tend toward the latter. They cite the cultural norm of pride-of-homeownership, immigration growth, and vacation homes along the Mediterranean coast as stabilizers to the mortgage industry.
Investment Decision Making in an Entrepreneurial Firm: An Application
Dr. Prakash L Dheeriya, California State University, Dominguez Hills, Carson, CA
This paper is a case study of a capital budgeting decision made in a small manufacturing plant in Torrance, California. The firm manufactures generic type of laser cartridges for use in monochromatic laser printers and has a distribution network all over the United States. The firm is considering the purchase of automation equipment which will increase its production three-fold, and will use the excess production to serve the Latin American markets, including Mexico. It has been in operation for over 4 years and has experienced substantial growth since prices of laser printers have fallen. The data represented in this case study is from the 2006-2007 fiscal year and is used to show the benefits of implementing good capital budgeting techniques in a small, rapidly growing entrepreneurial firm. This paper will discuss the current capital budgeting process, problems, and proposed solutions in the framework of entrepreneurial finance. Small entrepreneurial firms are typically run by single owners who may lack financial expertise to evaluate investment proposals. They may rely on their personal accountants, tax advisors, bankers to provide key input in the capital budgeting process. Many studies have been undertaken to evaluate methods used in capital budgeting in small firms. Pereiro (2002) looked at Argentinian firms and found that (a) discounted cash flow techniques like NPV, IRR and payback are very popular among corporations and financial advisors; (b) the CAPM is the most popular asset pricing model (c) cross-border adjustments to U.S. multiples and betas are rarely used by corporations; and (d) corporations tend to disregard firm-related unsystematic risks, like small size and illiquidity. Results of mainstream capital budgeting research typically apply to large firms. The smallness of entrepreneurial firms creates unique problems in application of traditional capital budgeting principles.
Cited by: 3
“The Relationship Between a College’s Success in Sports to Applications, Enrollments and SAT Scores”
Dr. Chaim Ehrman, Loyola University of Chicago, IL
Dr. Allen Marber, Fordham University, NY
The relationship between a college’s success in sports to applications, enrollment, and SAT scores can be viewed as a research study, trying to identify several trends. If a college is successful in sports, especially football and basketball, does it reflect that success in more students applying to that particular institution? In addition, what is the impact of success and the increasing number of applications? How will this increase in applications reflect on enrollments? Will the college’s policy towards enrollments change? Finally, how will a successful sports program which generates a larger applicant pool impact on the average SAT scores of the incoming freshman? There is a strong, enthusiastic feeling among College students and Alumni regarding Varsity Sports. There is a quote from Bobby Knight, a famous, well known Coach. He said that if the Dean were to ask him to raise $50,000 for the University Library, it will take him at least 3 months to raise the money, and he is not sure if he will meet his quota. If, however the dean were to ask him to raise $50,000 for a new Sports Arena for the Varsity Team, he will have the funds ready by the next day! There are a few examples that highlight this relationship between success in sports and applications and enrollment. Doug Fluti was a football “superstar” on the field, and his performance had a direct impact on applications and enrollment at Boston College. Similarly, Pat Ewing was a basketball superstar and his performance affected applications for his College, Georgetown University.
Cited by: 4
Comparison of Existing and New Tax Burden and Tax Effort Measures:
Evidence from the Southeastern United States
Dr. Sanela Porča, University of South Carolina Aiken
Dr. David S. Harrison, University of South Carolina Aiken
Economists and policy analysts frequently use the concept of tax burden to compare the effect of state and local tax policies on residents’ economic well-being over time or between states. There are a number of methods to measure tax burden, and none can be considered perfect. Which measure to use depends on the question a researcher is trying to answer? One has to keep in mind that different measures of tax burden have strengths and weaknesses. Therefore, the results should be carefully reported and interpreted for the readers. The current study compares the existing tax burden and tax effort measures and introduces a new, simplified Representative Tax System measure. Economists and policy analysts frequently use the concept of tax burden to compare the effect of state and local tax policies on residents’ economic well-being over time or between states. There are a number of methods to measure tax burden, and none can be considered perfect. Tax burden represents a loss of economic well-being that arises from state and local government taxation. Knowing how a proposed tax change can affect the state and local tax burden is essential for assessing changes in adequacy, efficiency, and equity. A satisfactory measure of tax burden would take into account all taxes imposed by state and local governments and would indicate how tax changes alter the economic well-being of residents and the profitability of business firms. When tax burdens are measured as a percentage of tax capacity, the resulting number is know as tax effort.
CEO Annual Bonus Plans: Do Performance Standards Influence the Association
between Pay and Performance?
Aamer Sheikh, Ph.D., Quinnipiac University, Hamden, CT
This paper provides evidence on the effect of internal versus external performance standards on the association between CEO annual bonuses and firm performance. It is the first paper to provide large-sample evidence on whether the type of performance standard influences the association between CEO annual bonus awards and firm performance. Using a sample of 754 firms for the years 1992-2005, I find that CEOs of internal standards firms have a lower sensitivity to accounting earnings than CEOs of external standards firms. The sensitivity to firm stock returns does not differ between internal and external standards firms. These results are robust to the inclusion of various control variables and alternative specifications of the regression model. Virtually every for-profit corporation uses annual bonuses to award its Chief Executive Officer (CEO). In light of the recent corporate scandals (Enron, WorldCom) which many attribute to the proliferation of stock options in CEO pay in the nineties, bonuses are likely to become an even more important component of CEO compensation (Leonhardt, 2002; and The Conference Board, 2002). Tony Lee, editor-in-chief of CareerJournal.com, the Wall Street Journal’s executive career website notes that “we’re seeing a rise in incentive plans that pay bonuses in place of stock options” (ERI/CareerJournal.com Executive Compensation Index, 2002). Murphy (2001) shows that the standards against which performance is measured play an important role in determining the amount of bonuses awarded to CEOs. This is in addition to the performance measures used by compensation committees in awarding CEO bonuses. These performance standards are especially important whenever bonus plan participants can influence the standard-setting process.
Cited by: 6
A Means-End Approach to the Analysis of Visitors’ Perceived Values of Leisure Farms in Taiwan
Yueh-Yun Wang, Far East University, Taiwan
The domestic agricultural industry faces the challenge of internal competition since it has joined the World Trade Organization (WTO). In order to help farmers, the Council of Agriculture of Taiwan has started to promote agricultural tourism. This study conducted an analysis of visitors’ perceived values toward leisure farms from the perspective of their experiences. With a Means-End Chain (MEC) approach, the results of this study revealed that the concept of experiential marketing is applicable to the leisure industry. Both the experiential modules, FEEL and SENSE, were considered to be most important from visitors’ viewpoints. The perspective of FEEL was formed by the results of relaxing, scenery, atmosphere of rural living, artificial Landscape. Based on these findings, we conclude that the attributes of scenery, artificial landscape and the atmosphere of rural living are essential for leisure farms to attract visitors. SENSE was derived from the results of feelings of appreciating natural beauty. Furthermore, the attribute contributing to the formation of appreciating natural beauty is scenery. As leisure farms are a newly developed industry in Taiwan, there has been little research in this field. This study could be of practical reference to marketing leisure farms and be an example of researching related industries. The importance of customers’ perceived value has been evidenced in the practice of marketers and with the research work of scholars for decades. As pointed out by Woodruff (1977), customer value has become one of the major sources for the advantage of competition. In order to satisfy customers’ needs, research projects should focus on exploring customers’ expectations of products and services provided (Albrecht 1994).
Cited by: 17
Mergers & Acquisitions (M&As) As the Micro Effect of Globalisation and Turkish Insurance Sector
Suna Oksay, Ph.D., Marmara University, and Director, Turkish Insurance Institute, Istanbul
From 1980s, we see the influences of globalisation in all over the world. With globalisation, countries in several parts of the world with different rules and regulations, eliminate their current rules and liberalise their markets (de-regulation) and organise them with the rules similar to other markets (re-regulation). Consequently, as financial markets in the world are regulated with similar rules, the players (buyers and sellers) of different markets can easily operate in all markets. From 2000s, the effects of globalisation began to be seen in financial and insurance markets. It is clear that they appear intensively in Europe as well. As the macro effect of globalisation, European countries have come together, established the European Union and begun to use single currency. In this context, it is also decided to have a single insurance market. On the other hand, as the micro effect of globalisation, in Europe, from 1990s, the number of mergers and acquisitions (M&As) significantly increased in order to increase the competitive power. This paper will elaborate the issue of mergers and acquisitions in Europe, as the micro effect of financial globalisation and the results of the mergers and acquisitions. Financial globalisation can be defined as “financial markets in different countries having similar rules and regulations and acting as a single market.” With globalisation, these markets with different rules, eliminate their current rules and liberalise their market (de-regulation) and organise it with the rules similar to other markets (re-regulation). Consequently, as financial markets in the world are regulated with similar rules, the players (buyers and sellers) of different markets can easily operate in all markets. With the globalisation, borders between markets are also eliminated. Globalisation, which increases integration, has both micro and macro effects. While macro effect appears as a result of the integration of the countries to increase their competitive power, micro effect appears as a result of the integration of companies by way of mergers and acquisitions.
Strategic (Big Picture) Technology
Dr. D. Keith Denton, Missouri State University
The problem for an organization or even a group is that this individual thinking and behavior are frequently at odds with other well-meaning and purposeful behavior. When we do have a moment to lean back and ponder, there is no system to help us understand where we are headed, where we are at, or how we are doing. Creating an effective work system entails linking strategy to operation objectives. A good system of performance measurement and feedback should facilitate a broader understanding of how the pieces fit together. This performance measurement and feedback system should address three critical concerns. There is help today and it is coming from a most unlikely source. Intranet technology can help groups improve their teamwork and performance by cutting through the details to reveal the connections and relationships at work. New use of intranets can be used to track and display the relationships between key outcomes and processes that lead to those outcomes. The intranet and supporting software has the capability to integrate outcome issues, like profitability or service concerns, with those processes that lead to those outcomes. Intranets can be used to integrate disconnected metrics to create a more realistic picture of what is really going on within the organization. Key objective measures of performance, like financial performance, could be compared to important subjective concerns, such as the degree of teamwork or perceived group effort. The everyday work world is often filled with endless details and low-level decision making. All of this, of course, is usually out of the sight and minds of senior-level executives. The work world, for many, is a maze of disjointed efforts.
Fostering and Funding Entrepreneurship (Innovation and Risk-Taking) in the Biotechnology Industry
Dr. Sumaria Mohan-Neill, Roosevelt University, Chicago, IL
Michael Scholle, formerly, Argonne National Laboratory, IL and currently, Ammunix Corporation, CA
Entrepreneurship, through innovation and risk-taking, has driven the recent phenomenal growth in the biotechnology industry. However, due to the very sophisticated technologies and processes required to accomplish innovations in biotechnology, it is a very capital-intensive industry. Sources of both human and financial capital are critical components for the survival and the eventual success of biotech companies. This paper explores the sources of funding in the biotechnology industry. It argues that biotechnology companies are more entrepreneurial, productive and innovative than larger pharmaceutical companies, and it predicts that mergers and acquisitions (M&A activity) will continue to accelerate, as larger and less innovative firms use more entrepreneurial firms to supplement their technology and product pipelines. However, the challenge is how to maintain innovation and foster the entrepreneurial spirit of a smaller biotech company after it has been digested by a larger entity. There are certain types of industries in which entrepreneurship and innovation do not require significant investment of financial and human capital; biotechnology is not one of those industries. The knowledge base and skill-set required to innovate require a very sophisticated understanding of science and technology.
Cited by: 6
The Antecedents and Outcomes of Union Commitment in Turkey
Dr. Tunc Demirbilek, Dokuz Eylul University, Izmir, Turkey
Dr. Ozlem Cakýr, Dokuz Eylul University, Izmir, Turkey
The concept of union commitment is becoming increasingly important because of the decreasing number of union members in recent years. This paper presents findings of a study which examines the antecedents and consequences of union commitment on Turkish workers. The research is carried out by the members of a union established on oil and chemical plants located in the Aegean Region of Turkey. 461 respondents from 8 private sector firms are used as samples. Hypothesis about union commitment and normative approach, instrumental approach, attitudes toward industrial relations, attitudes toward unionism, socio-psychological support are confirmed. The findings also support the hypothesis regarding the relationship between union satisfaction, union participation and union commitment. Since 1980s, behavioral researches have focused on the attitudes of both current and potential union members. These researches have examined members’ attitudes in a wide range. The attitudes in question are depicted respectively as: general attitudes toward unions, union instrumentality perceptions (i.e. members’ degree of belief in unionism about succeeding in considerable subjects – such as salary, job safety), satisfaction about union performance and union-member relations, members’ feelings about their initial experiences in union (member socialization), comments about making use of grievances procedures and its effectiveness, and opinions about leadership skills of union stewards and union officials. Union-based behavioral researches arranged different attitudes and opinions about unions under the title: “union commitment”.
Intellectual Capital and the Perceived Relevance of the Balance Sheet as a Value Measure for Corporations
Dr. Shaniz Khan, Al Hosn University, Abu Dhabi, United Arab Emirates
This paper investigates the impact of Intellectual Capital and its components on the perceived relevance of the balance sheet as an indicator of corporate value. It represents an attempt to integrate previously fragmented literature on Intellectual Capital to a single framework while providing an empirical examination on the effects of Intellectual Capital components. Results from the study have demonstrated that the balance sheet was indeed perceived to be irrelevant as an indicator of corporate value and was significantly associated with the level of investment in Intellectual Capital. This association was largely contributed by the Human Capital component. Thus, organizations that fail to disclose Intellectual Capital will find their balance sheets no longer perceived relevant as an indicator of their corporate value. Further, in disclosing Intellectual Capital in the balance sheet, more attention needs to be given to the Human Capital component. Assets are probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events (Statements of Financial Accounting Standards 3, 1980). These future economic benefits give every asset a value (Bernstein, 1993). Therefore, assets owned or controlled by corporations collectively determine the entire value of organizations (Edvinsson & Malone, 1997). Since the balance sheet is a financial statement that captures organizational assets, it becomes an important tool used by companies to measure and communicate their value (Edvinsson & Malone, 1997; Hopwood, 1976; Cheney, 1995; Jones, 1995).
Cited by: 4
The Evolution of Sea Navigation between the Two Sides of the Taiwan Strait
Ya-Fu Chang, Chang Jung Christian University, Taiwan, ROC
Dr. Chuen-Yih Chen, Chang Jung Christian University, Taiwan, ROC
Direct navigation between the two sides of the Taiwan Strait has been disrupted since 1949 as a result of political confrontation between Taiwan and Mainland China. However, with the increasing civil exchanges and trade activities and the rapid growth of foreign trade volumes at the harbors of Mainland China in recent years, the policies and approaches regarding direct navigation by the governments on both sides of the Taiwan Strait have given rise to concern by international shipping companies, whose vital business interests are closely connected with East Asian shipping lines. This paper analyzes the evolution of policies regarding direct navigation and shipping modes adopted by governments on both sides, particularly the content of and differences in restrictions on containership shipping lines. Recommendations for improvement of these policies are also provided. Since 1949, as a result of civil war in China, the governments on the two sides of the Taiwan Strait have prohibited cross-strait maritime exchanges and trade, despite increasing demands for an end to restrictions on such activities. Accordingly, seaborne cargo had to be unloaded and transshipped from third places, such as Hong Kong. Taiwan began to allow residents to visit relatives on the Chinese mainland in 1987, and Hong Kong was returned to Chinese sovereignty in 1997. Anticipating the loss of Hong Kong’s role as a third place apart from the two sides, Taiwan introduced an Offshore Shipping Center strategy in order to maintain its “no contact, no negotiations” policy toward Mainland China.
Mergers and Operational Efficiency in Taiwan’s Audit Firms
Tsung-Yi Tsai, Shin Chien University Kaohsiung Campus, Taiwan
Dr. Chung-Cheng Yang, National Yunlin University, Taiwan
This paper uses Data Envelopment Analysis (DEA) to assess the cost efficiency, the technical efficiency, and the allocative efficiency of audit firms, and applies Tobit censored regression model to examine the relationship between operational efficiency and audit firms’ mergers. Estimation of the model uses a balanced panel data for 120 audit firms for the period 1997-2001 in Taiwan. The empirical results indicate that the effects of mergers on scale economies effects are larger than cost effects, justifying recent merger activities in the public accounting industry. In the knowledge-economic age, audit firms’ professional services play a key role in the capital market. Different types of fraud within the audit profession have increased, and many countries have tightened legal restrictions on audit firms, including prohibiting them from providing some non-audit services. These difficulties have been compounded by market competition and other pressures related to the development of audit firms, so the question of how audit firms can survive in this changing environment is worth analyzing. For a long period of time, merger has been an important strategy adopted by audit firms to facilitate growth. At the end of the 1980s, the Big-8 audit firms began to merge, and the Enron scandal in 2002 led to the dissolution of Arthur Anderson. These events resulted in the Big-8 becoming today’s Big-4 audit firms. In the past, the research on mergers often concentrated on the auditor concentration, market power, market share, audit quality, profit margin and audit fees (Lee, 2005; Minyard and Tabor, 1991; Owen, 2003; Payne and Stocks, 1998; Tonge and Wootton, 1991; Wootton et al., 1990, 1994). However, merger is not a solution to all problems.
Cited by: 7
Users’ Perception of Entities’ Performance: Risks Arising from Implementing the Revised Version of IAS 1
Dr. Alessandro Mechelli, University of Tuscia, Viterbo
This paper deals with the issue of performance reporting by entities, an old issue that has interested academics and users for a long time. A recent standard (the revised version of IAS 1) issued by the International Accounting Standards Board tries to improve this reporting, attempting to bring IAS/IFRS standards into line with Statement of Financial Accounting Standard 130, Comprehensive Income. This standard, being only a segment – called segment A – of the whole project, does not deal with defining concepts on the basis of every kind of result, limiting itself to ordering that all non-owner changes in equity recognized in accordance with current standards be presented in one or two statements. We will show that these innovations put financial reports on the right track, but do not help users to understand the clear meaning of different kinds of results recognized in financial statements. The revised version of IAS 1 could have the result of affecting the users’ perception of entities’ performance, without defining the concept of performance that entities should show – a concept that, perhaps, will be explained in segment B. This approach could create a clouded situation in the interpretation of an entity’s performance and, consequently, in using the entity’s performance to make economic decisions. The measure of an entity’s performance is an old issue that has interested academics and users for a long time.
Cited by: 2
Health Insurance: Do You Know What’s in Your Policy?
Marsha R. Lawrence, Albany State University, Albany, GA
According to the U.S. General Accounting Office (as cited in Thomasson, 2003), 95 percent of working Americans, under age 65, receive health insurance through their employers. Health insurance through employment is the number one method of paying for healthcare related expenses, but do people really understand health insurance and how it works? According to Employee Benefit Research Institute (EBRI) President Dallas Salisbury, “ . . . many Americans are not able to identify their health care plan, making a difficult issue more complicated by this lack of knowledge” (Latest survey, 1999). This is a quantitative study that seeks to examine if patients understand health insurance and its processes including why some services are paid and some services are not. The findings of this study are contradictory to the EBRI statement, in that the participants were able to identify their health care plan. Other significant findings include the fact that participants were satisfied with their health plan but they were not sure what is in their plan. Lastly, they read their Explanation of Benefits (EOB) but were not sure why services are often denied. According to the U.S. General Accounting Office (as cited in Thomasson, 2003), 95 percent of working Americans, under age 65, receive health insurance through their employers. Health insurance through employment is the number one method of paying for healthcare related expenses, but do people really understand health insurance and how it works?
The Role of Trust in Joint Venture Control: A Theoretical Framework
Samson Ekanayke, Deakin University, Victoria, Australia
This paper develops a theoretical framework and a number of propositions for systematically studying the role of trust in the control and performance of Joint Ventures, a prominent form of inter-firm alliance. The proposed framework is more complete than the frameworks available in the extant literature because it incorporates both transaction related risks and the partner related risks which are likely to impact on the reliance on particular control patterns. Partner-related risks in joint ventures are represented by the level of inter-partner trust, while transaction-related risks are represented by the Transaction Cost Economics (TCE) variables of asset specificity, task complexity, performance measurability, and environmental uncertainty. The framework also links one of the established management control typologies (i.e., behaviour, outcome, and social) to two of the alliance control patterns (bureaucratic-based pattern, and trust-based pattern) identified in the literature on alliance control. Inter-firm alliances, such as joint ventures, are a form based on mutually dependent cooperative relationships between two or more firms. However, alliances often combine elements of cooperation and competition (Parkhe, 1993; Child, 1998). As Child (1998, p. 242) observes “Mutual reliance and competition or conflict between partners can set up a game theoretic dynamic that adds to the risk and precariousness of the cooperation”. Cooperation and trust as well as competition and distrust exist within alliances (Child, 1998).
How can Village Banks Maximise their Strategic Role of Promoting and Developing Small
Businesses: An Overview of Developing Nations
Kisembo .K. Deogratius, Breyer State University, London Centre, UK
Village banking which is also referred to as private or local or private banking by many authors has been a fast-growing business in many more developed countries, and now it is moving into less-developed countries such as Sub-Saharan Africa as well. It is with no doubt that village banks are one of the major sources of funding for many Small Businesses in many Developing countries. The winds of competition are blowing through the world's banking market, particularly at the top end. Local banks in many areas have seen their wealthiest clients take their funds to international private banks. Now some are responding by developing their own services. "The opportunities for domestic Village banks appear to be very great indeed," says David Gibson-Moore, executive manager of private banking and share trading at the Al-Rajhi banking and Investment Company of Riyadh. Gibson-Moore echoes the sentiments of many individuals throughout the world that see the growth and development of village banking – in many different countries. The concept of village banking will be discussed more fully throughout the paper. It is important to define it and analyze it, because many people are unfamiliar with the terms and ideas used in the village banking tradition, and they may become confused if these terms are not explained more fully to them. Village banking will also be discussed in the literature review, as will the banking concept in general, small businesses, and developing countries, as it is important to see how all of these issues come together. The study will highlight examples from the Islamic banking industry, because it is involved with many village banking ideals and these are spreading into both developed and developing countries.
Networked Organization and the Owner/Supplier Relationship
Dr. Deborah Hardy Bednar, Chevron, Houston, Texas
Dr. Lynn Godkin, Lamar University, Beaumont, Texas
This case study details the criteria for establishing a Networked Company. The criteria is then focused on the development and management of a Networked Company involving an environmental remediation project. The participants include an international manufacturer, an environmental engineering firm and a privately held construction company. Conclusions related to trust relationships in the face of project complexity are reported. The notion that individuals can come together in virtual organizations and networked organizations is being recognized in the literature. (Hedberg & Holmqvist, 2003, p. 735) Networked companies are typically associated with advanced information technology (Grenier & Metes, 1995) in partnerships (Davidow & Malone, 1992) and with temporary groupings. (Goldman, Nagel, & Preiss, 1995) However, Hedberg uses the term “imaginary organization” to discount the influence of information technology. (Hedberg & Holmqvist, 2003) He uses “virtual organization” to refer to those organizations which are temporary and “imaginary organization” to those with similar characteristics, but of longer duration. (Hedberg, 2002, p. 11) Otherwise, networked companies coordinate their activities through development of joint mission and vision statements. (Hedberg & Holmqvist, 2003) “Although they typically consist of a number of semi-independent legal units, they behave as one organization, and they exist and are manifested in the imagination of their leadership.” (p. 734)
Personal Traits and Leadership Styles of Taiwan’s Higher Educational Institutions in Innovative Operations
Dr. Jui-Kuei Chen, Tamkang University, Taiwan
I-Shuo Chen, Graduate Student, National Dong Hwa University, Taiwan
With increasing numbers of higher educational institutions in Taiwan, how to become more efficient through innovative operation has become a critical issue. This paper studies the “Big-5” personal traits, leadership styles, and their relationship to innovative operation. Conducted with a sample of universities in Taiwan, the study analyzes 194 professors and lecturers from three universities by means of a questionnaire. The dimensions are divided into three parts: personal traits, leadership styles, and innovative operations. The study utilizes factor analysis, variable analysis, and correlation analysis. The two main findings are, first, that traits of extraversion and agreeableness have a positive relationship to higher perception of innovative operation in the university. Second, transformational leadership should combine with transactional leadership without management-by-exception passive (active participant style) for more efficient innovative operation. A discussion of the key research findings and some suggested directions for future research are provided. Because of Taiwan’s joining the WTO and an increasing number of universities, innovative operations have become a crucial issue for survival in a competitive higher-education market. Extant research has indicated that organizational operations involve primarily top managers and their subordinates (Beng & Robert, 2004), although some studies have shown that institutions of higher education often fail to implement innovative operation (Glower & Hagon, 1998; Cuban, 1999) because of a lack of participation by teachers (McLaughlin, cited in Rudduck, 1991). Because of this finding, understanding the personal traits of teachers and managers’ leadership styles will be crucial for universities which seek innovative operation.
Constructing Financial Ratios to Evaluate Technical Corporations
Chun-Huang Liao, National Chiao Tung University of Management Science, Hsinchu &
Lecturer, Chungchou Institute of Technology, Yuanlin Changhwa, Taiwan, R.O.C.
This article constructs cross-sectional data from financial ratios to evaluate technical corporations in Taiwan. Via establishment of financial constructs, 560 listed companies were segmented into four groups, each with its own financial situation. Financial ratios—including pre-tax EPS, net worth per share, cash flow per share, after-tax ROE, revenue per share, quick ratio, current ratio, and net worth ratio—are found to be significantly related to the factor of corporate market value. Reducing eight variables to two financial constructs—Operating Efficiency (OE) and financial Physique Structure (PS)—provides an overall financial picture and differences among listed companies. The findings should prove valuable in portfolio management and corporate financial decisions. Revealing the financial quality of tech corporations, with financial constructs as a filter, can help to reduce risk and raise the performance of investment capital. Although the scientific and technological industry in Taiwan and many advanced countries is flourishing, not all tech corporations are at the same stage of development: Some are at the growth stage of the industry, some are in the plateau period, some are in the decline phase, and a few face bankruptcy. Filtering financial constructs helps to divide firms into different groups in order to benefit investors and layers of management. This paper presents four types of financial situations. First, firms with relative advantages in both Operating Efficiency (OE) and Physique Structure (PS) deserve better ratings, and investments in these firms should be maintained because their credit risk is relatively low. Second, firms with relative advantage in OE and relative disadvantage in PS can expect their future financial situations to improve, and investments in these firms should also be maintained for potential future capital gains.
Skill Requirements for Software Developers: Comparisons between U. S. and Taiwan
Jui-Hung Ven, China Institute of Technology, Taiwan, R.O.C.
Chien-Pen Chuang, National Taiwan Normal University, Taiwan, R.O.C.
The job advertisements for software developers were collected from web recruiting services in the U. S. and Taiwan. Skills requirements were gathered via a semi-supervised program based on the information competency ontology created by the authors. All skills were classified into six categories: operating system skills, programming language skills, markup language skills, database skills, distributed technology skills, and other skills. The proportion of skill requirements for each individual skill and matched pairs in every skill category were calculated. The most common skills needed were reported and compared. The result shows that Windows, Java, SQL Server, and .NET were the most common needed skills in the four main categories. The average numbers of skill requirements were 9.16 and 7.69 in the U. S. and Taiwan, respectively. A software developer should have many facets of competencies in order to complete the design, development, installation, and implementation of information systems. Competency is a set of KSA, which is the acronym for knowledge, skill, and ability. From an employment’s point of view, a software developer should know the knowledge related to software development such as programming techniques, data structures, relational database concepts, object-oriented concepts, software development life cycles, and etc. A software developer should also have technical or hard skills such as Windows, Java, VB (Visual Basic), SQL Server, and etc. Abilities or the so-called soft skills such as listening, speaking, reading, writing, information gathering, and etc. are needed in all workplaces. However, skills are specific to different job areas (LaDuca, 2006). Hence, of the three areas of competence--knowledge, skills, and abilities--skills are recognized as the most important for software developers (Bailey & Stefanik, 2001).
Cited by: 1
Accounting for Impairment Test of Investments in Subsidiaries and Associates
Mauro Romano, Ph.D., University of Foggia, Italy
This study examines the two principal items that need to be treated in the impairment accounting of investments in subsidiaries and associates: goodwill and minority interests. The specific attempt of this study is to concentrate the attention on the determination of recoverable amount, defined as the higher of fair value less costs to sell of the asset and its value in use. The impairment test of investments in subsidiaries and associates may be approaching in different way in separate and consolidated statements. In the separate statement, the carrying amount of an investment in subsidiaries or in associates is compared with recoverable amount to determine impairment loss; in the consolidated statement, the impairment test regards identifiable assets and liabilities of the subsidiary or associate and, then, as residual value, the “goodwill on consolidation” resulting from the consolidation techniques. The proposed amendments of IFRS 3 (June 2005) introduces the ‘full goodwill’ method in the consolidated statement, with interesting reflects on the impairment test accounting. The standard applies to an entity that makes an explicit and unreserved statement that its general purpose financial statements comply with IFRS. The standard sets out the procedures that an entity must follow when adopting IFRS for the first time. Its objective is to ensure that financial statements contain high quality information that is transparent, comparable, and can be generated at a cost that does not exceed the benefits to users. The general principle is that first-time financial statements should be prepared on the basis that the entity had always applied IFRS. This is the so-called “retrospective application.”
The Choice of Housing Location
Hsiu-Yun Chang, National Taiwan University, Taiwan
& Lecturer, Chungchou Institute of Technology, Yuanlin Changhwa, Taiwan
This study attempts to explore the influence of house demanders on choice of housing location. The neighborhood’s effects have been investigated for a long time, and they are very important factors in the real estate market. However, more and more literature has recently focused on asymmetric information, and indirectly has found that a local home bias phenomenon exists in the choice of housing location. For example, Lerner (1995), Coval and Moskowitz (1999, 2001) and Garmaise and Moskowitz (2004) contribute to the literature by investigating the relationship between the distance and the degree of information asymmetry. Their investigation indirectly injects the conception of the local home bias phenomenon into the real estate market. This study models the spatial home bias effect and spatial neighborhood effects that arise from distinct community components and tries to explore whether the contextual interactions within the community influence the choice of housing location by the household members. Finally, the results prove that both effects influence the location choice of housing buyers. For further investigation, this study suggests that researchers can collect real estate data to test the magnitude of both these effects within each jurisdiction of a country, and thus forecast immigration phenomena. Housing purchase behavior consists of dual motives: consumption and investment (Henderson and Ioannides, 1987; Arrondel, 2001). For consumption demand, houses are durable consumption goods and yield tangible services each period.
Cited by: 3
Long-Run Share Prices and Operating Performance Following Share Repurchase Announcements
Dr. Chaiporn Vithessonthi, University of the Thai Chamber of Commerce, Bangkok, Thailand
This study uses a new data set to assess whether our understanding of share repurchase is portable across countries with different institutional settings. This paper presents the empirical results regarding long-run stock price and operating performance following share repurchase program announcements of listed firms in Thailand between 2001 and 2005. The results show that there is some evidence of long-run abnormal stock returns following announcements of a share repurchase program, implying that the market fails to incorporate the valuation effect of share repurchase information in a short period. The findings provide no evidence of the long-run operating performance improvement following the share repurchase program announcements. It has long been documented that the initial stock price reaction to share repurchase announcements is positive (Comment and Jarrell, 1991; Dann, 1981; Peyer and Vermaelen, 2005; Lakonishok and Vermaelen, 1990; Rau and Vermaelen, 2002; Vithessonthi, 2007). However, several studies have questioned whether the market fully incorporates the valuation effect of share repurchase information in a short period. Some conclude that stock prices underreact to share repurchase announcements, and that the investors fully incorporate the effect of a share repurchase announcement in subsequent periods.
Cited by: 4
International Dual Listing: An Analytical Framework Based on Corporate Governance Theory
Dr. Yun Chen, Huazhong University of Science and Technology, Hubei University of Economics, Wuhan, P.R.China
Recent studies have found corporate governance is a better explanation to understand the international dual-listing phenomenon. Based on reviewing conventional theory of international dual listing and its limitations, this paper explains international dual listing theoretically from corporate governance perspective. At the same time, it develops a basic analytical framework of relationship among international dual listing, external and internal corporate governance. The internal corporate governance mechanism includes ownership structure, shareholder base and the board of director. The external corporate governance mechanism includes legal system, disclosure requirements, monitoring from reputation intermediaries and market for corporate control. International dual listing will change external and in turn stimulate the company upgrade its internal governance mechanism. The globalization in equity market has accelerated stock trading from around world. Up to now, tremendous competition has arisen among major stock exchanges around the world to attract listings and trading volume and to stoke capital-raising activity by overseas companies in their markets. According to the report of World Federation of Stock Exchanges in 2005, the number of foreign companies with shares dual listing and trading on major exchanges outsides of their home markets reached 2300, including the companies not only from developed countries but also from emerging countries opening up their stock markets to foreign investors for the first time.
Cited by: 11
Performance of Suppliers’ Logistics in the Toyota Production System in Taiwan
Nelson N. H. Liao, Chihlee Institute of Technology, Taipei, Taiwan
The present paper referred to the model of Dong, Carter and Dresner (2001) and sampled the supervisors of Toyota automobile suppliers in Taiwan to examine whether the supply chain integration, just-in-time (JIT) purchasing and JIT manufacturing can benefit the logistics performance of suppliers. The results indicated that supply chain integration, JIT purchasing and JIT manufacturing had direct and significant benefits to logistics performance. The implementation of just-in-time (JIT) purchasing systems can result in reduced inventory costs, shorter lead times, and improved productivity for buying organizations (Shingo, 1981; Schonberger, 1982; Hall, 1983; Ansari and Modarress, 1987; Tracey, Tan, Vonderembse, and Bardi, 1995). A buyer’s inventory costs may be reduced because costs are transferred to suppliers after implementation of JIT (Romero, 1991; Fandel and Reese, 1991; Zipkin, 1991), so suppliers’ inventory costs are less likely to decrease (Dong, 1998). Dong, Carter and Dresner (2001) developed and tested a practical model to determine whether the use of supply chain integration, JIT purchasing and JIT manufacturing could reduce logistics costs for both suppliers and buyers. The result of their test for suppliers is shown in Figure 1; although the extent of supply chain integration and JIT purchasing have no direct benefits to logistics costs, these two dimensions have indirect benefits to logistics costs through JIT manufacturing. This paper refers to the theoretical model of Dong et al. (2001) and samples the supervisors of Toyota production system suppliers in Taiwan to examine whether the extent of supply chain integration, JIT purchasing and JIT manufacturing can directly benefit suppliers’ logistics performance.
Cited by: 4
The Dynamic and Full Significance of Macroeconomics’ Main Equation
Jose Villacís, Ph.D., Universidad San Pablo-CEU, Madrid, Spain
Germán Bernácer (Alicante, 1916-1926) laid the foundations of macroeconomics between 1916 and 1926. In his first book, “Society and Happiness. An Essay on Social Mechanics,” (Sociedad y Felicidad. Un Ensayo de Mecánica Social, 1916) Bernácer explains a macroeconomic production design, the origin of income and interest, and the monetary market. In 1922, he publishes an article under the title, “The Theory of Liquid Assets,” (La Teoría de las Disponibilidades) wherein he expounds the questions of money demand and the origin of interest. Liquid assets and production funding are two issues stressed throughout Bernácer’s whole work that the author believes are yet to be discovered by macroeconomics; these two concerns are the starting point for this paper. Savings originate from income and revert into the production circuit in the form of demand for capital equipment – we call this operation “investment.” Actually, there is a portion of savings that are liquid assets, which are neither capitalized nor amassed, but rather, circulate and are used to repurchase secondary financial assets. This means, in the first place, that liquid assets entail a lack of demand. Secondly, that there is a part of the financial market that diverges, and therefore, such part is not neutral, nor does it function as a simple bridge between savings and investment. In addition, where there are liquid assets, then the portion of income that is not saved should be divided into two factions: the portion of savings to be capitalized on the one hand, and liquid assets on the other hand. Thus, macroeconomics’ main equation should be at least completed with regard to its financing aspect – one side of the identity. Another particular aspect of the theories of Germán Bernácer, who taught Physics, is the way in which he deals with working capital, divided in two parts: one is the sum of added values or domestic product, the other is the total working capital.
Promptness: A Teaching and Evaluation Model
David L. Russell, Ph.D., Western New England College
Promptness is a desirable behavior in students and an expected behavior in professionals. Promptness can also be viewed as a surrogate variable of the larger concept of engagement with the course. Here, a model to integrate the evaluation of promptness into the usual pattern of teaching a college-level course is presented. The life cycle of a specific assignment is presented and broken down into measurable intervals. Classroom management software provides the key tool to perform the analysis. Other forms of evaluation of promptness are presented. Conclusions are drawn, focusing on increasing learning by maximizing the time students have available between the opening of a posted assignment and its submission. Professors of Information Systems (“IS”) are expected to teach our classes in an interesting and informative matter, using technologies selected for their currency or for which there is demand in the labor market. Professors are also expected to themselves reasonably well informed about developments in the field and to conduct research in ways that meld with the mission statement of the professor’s institution. In a more diffuse manner, professors are expected to serve as role models, thus helping students to evolve into working professionals. Some of the skills needed in this evolution can be taught explicitly: communications skills in Communications course and team interaction skills in Organizational Behavior classes are examples. Other skills can be taught by correction: for example, the student who uses coarse language in a class presentation can be counseled about the inappropriateness of that behavior.
Cited by: 1
The Evaluation of Advertising Costs Within the Accounting Recording System
Dr. Fatma Ulucan Ozkul, Bahcesehir University, Besiktas, Istanbul, Turkey
Advertising basically aims at leaving an impression on the mass of consumers and directing this mass to buy by effecting the ideas and habits of them and increasing the benefits of the companies. The aim of this study is, rather than to put emphasis on advertisements’ being important and necessary for the companies and the consumers, to include to make necessary improvements with the idea that under today’s conditions the companies’, who reserve high budgets on advertising, reflecting the expenses of advertisements to financial statements by seeing them only as a mean of sale increasing gives missing information to the users of reports and misdirects them. In this study, the importance of dealing with advertisements’ expenses as expenditures which should be traced within the frame of matching principle because they affect the profits of companies just not in the current year but in the following years. In this line, advertising should be evaluated as a means of investment in long term besides being evaluated as an activity of sale increasing in short term. Also, in the study, the expenses of advertising, which confirms the image of the business, increases its respect and makes it a brand, are dealt with not just as profits of current year but also the necessity of amortization in the period of getting benefited by capitalizing them. As a result of rapidly changing market conditions and increasing of competition day by day, marketing interaction and the people’s, who work in these areas, effective and rational usage of them have become important in the success of the many companies which produce similar commodities. Marketing which is one of the basic functions of business is a process which provides communication between the company and the consumer and gives benefits to the business by putting value on consumers and directing the consumer relations.
A Typology of Co-branding Strategy: Position and Classification
Wei-Lun Chang, Tamkang University, Taiwan
As many companies seek growth through the development of new products, co-branding strategy provides a way to develop new products. However, combining two brands may cause brand meaning to transfer in ways that were never intended. The present paper advances research on co-branding strategies by proposing a conceptual framework of co-branding through a typology with three concepts: co-branding aim, category, and effect. The typology framework not only provides a roadmap of co-branding strategies but also illuminates issues related to co-branding for related research.As many companies seek growth through the development of new products, co-branding strategy provides a way to develop new products as successful brands provide signals of quality and image. Co-branding involves combining two or more well known brands into a single product. A successful co-brand has the potential to achieve excellent synergy that capitalizes on the unique strengths of each contributing brand. In the last decade, co-branding and other cooperative brand activities have seen a 40% annual growth (Spethmann and Benezra, 1994). Companies form co-branding alliances to fulfill several goals, including: (1) Expanding their customer base, (2) achieving financial benefits, (3) responding to the expressed and latent needs of customers, (4) strengthening competitive position, (5) introducing a new product with a strong image, (6) creating new customer-perceived value, and (7) gaining operational benefits. One industry in which co-branding is frequently practised is the fashion and apparel industry (Doshi, 2007). The basic principle behind co-branding strategies is that the constituent brands assist each other to achieve their objectives.
Cited by: 31
Leadership, Knowledge Sharing, and Organizational Benefits Within the UAE
Dr. Mohamed H. Behery, University of Dubai
The study is about an exanimation of the relationships among transformational and transactional leadership, knowledge sharing, and organizational benefits in Dubai. Leadership behaviors, knowledge management, and organizational effectiveness are considered major business topics today. There has been no previous direct empirical evidence to examine the relationships among transformational and transactional leadership, knowledge sharing, and organizational effectiveness in Dubai. To fill this research gap, this study focused on examining this relationship with an additional emphasis on professional service firms. Using a sample of 560 employees from different business services sector, the significant findings of this study are: (1) transactional and transformational leadership were positively related to knowledge sharing in these organizational settings (2) knowledge sharing was considered as a valid predictor of the organization’s organizational benefits and effectiveness (3) transactional and transformational leadership were positively related to the organization’s organizational benefits effectiveness. (4) Unexpected neutral effect of demographic variables, such as gender and citizenship, upon the study’s variables has been detected. Limitations of this study and recommendations for future research are also provided. Although leadership has been considered an important factor in the success of knowledge-based organizations (Hefner, 1994), prior related research has studied: (1) the relationships between leadership behaviors and knowledge management (Politis, 2001, 2002; Ribiere and Sitar, 2003), (2) the knowledge-based approach in strategic alliance settings (Dyer and Nobeoka, 2000; Parise and Henderson, 2001), and (3) the relationships between leadership behaviors and organizational benefits (Rodsutti and Swierczek, 2002; Avery, 2001; Pounder, 2001).
Cited by: 47
Social Participation and Life Satisfaction: From Youth’s Social Capital Perspective
Jui-Kun Kuo, Ph.D., National Sun Yat-sen University, Taiwan
Cheng-Neng Lai, Ph.D., Shih Hsin University, Taiwan
Chun-Shen Wang, Doctoral Student, National Sun Yat-sen University, Taiwan
Through the participation of empowerment mechanism, community youths are guided to develop abilities such as autonomy, independence, and self-discipline. With these abilities, the youth could utilize social capital to impel community growth and group cooperation. The social capital theory is adopted in this research to explore the cause-effect relationship between trust, network interaction and social participation together with family interaction and life satisfaction. The object of the study is high school students. There are 2,757 effective questionnaires from the total number of 2,880, providing an overall response rate of 95.73%. Data are then analyzed through Structural Equation Model (SEM). With the multi-variant analysis that bases on regression, combining the path analysis, the research tries to develop the mode of the youth’s social participation and life satisfaction. At the end, suggestions are provided for the concept of strategy and further research directions. The results are summarized as follows: fine family interaction would result in high community trust cognition; high community trust cognition would lead to fine community network; high community trust cognition would also elevate the level of social participation; fine community network would uplift the willingness of social participation; fine family interaction would increase life satisfaction; fine community network would boost life satisfaction; high social participation would encourage life satisfaction; community trust has no influence on life satisfaction. The purpose of community building projects is to identify the feature of each community and distinguish it best element for development. With the integration of community organization, residents are encouraged to care and participate in public affairs.
Governance Effect of Capital Structure: An analysis of Chinese Listed Companies
Dr. Zhang Zhaoguo, Huazhong University of Science &Technology, Wuhan, PRC
He Weifeng, Huazhong University of Science &Technology, Wuhan, PRC
Liu Xiaoxia, Huazhong University of Science &Technology, Wuhan, PRC
Capital structure effect on corporate governance is ultimately expressed as the changes of corporate performance. Based on analysis of the data from Chinese listed companies（1992-2004）,we find that state-owner shareholding ratio has less and less effect on corporate performance; corporate shareholding ratio and the ratio of debt to financing are weak positive correlated to corporate performance; ownership concentration and managerial shareholding ratio have a positive relationship with corporate performance, and there is a significant negative correlation between retained earnings and corporate performance. These conclusions indicate that perfecting capital structure is one of the important approaches to optimize corporate governance and improve corporate performance. The governance effect of capital structure refers to the capital structure effects on corporate governance. Economists and financial researchers have focused on the field since the 1970's.The basic theory of the governance effect of capital structure is the capital structure contract theory first established by Jensen and Meckling (1976), which consists of three parts: the incentive-based models. such as the model of Jensen and Meckling (1986), Grossman-Hart (1982), Harris-Raviv(1990), Stutz(1988),which argues that capital structure influences the endeavor level and behavior choice of manager; The signaling models, such as the model of Ross (1997), Leland-Pyle (1997), Myers-Majluf (1984), which argues that capital structure can transfer some interior firm information to market and thus influences investors; And the corporate control-based models, such as the model of Grossman-Hart(1986), Harris-Raviv(1988), Stulz(1988), Hart-More(1990),
Global Fattening: Designing Effective Approaches to Reducing Obesity
Dr. Michelle Neyman Morris, California State University, Chico
Dr. Shekhar Misra, California State University, Chico
Dr. Scott Sibary, California State University, Chico
The obesity epidemic is drawing increasing attention in the professional and academic press. Most of the literature describes the trend, and suggests policies or actions to reverse it. This article focuses on criteria that should be used not only to evaluate, but to generate policies to address obesity. The criteria are explained and discussed in light of factors that have led to obesity, and those that limit or influence the practical choices of remedies. Because we believe that those marketing food are responding to a prevalent change in attitude regarding diet, activity and weight, we do not believe a complete reversal of the epidemic is likely. Rather, our work is premised on the belief that it is critical for those wanting to mitigate the public health issue of obesity to focus efforts on approaches that are most likely to be effective within limited financial and political resources. Since 1980, obesity rates among U.S. adults have doubled, while the number of overweight adolescents has tripled. Currently, two-thirds of American adults are overweight or obese leaving just one-third at a healthy weight, far below the Healthy People 2010 objective of 60% (Hedley 2004; www.surgeongeneral.gov). Analyses from recent population surveys suggest that these trends continue despite numerous public health efforts to reverse them. Recent analyses suggest that the methodology previously used to estimate the number of deaths attributable to overweight and obesity may have overstated the problem (Flegal et al.2005; Mokdad et al. 2004; Mokdad et al. 2005), yet it remains clear that extreme obesity is associated with an increased risk of coronary heart disease, stroke, hypertension, type 2 diabetes and certain cancers (Kuchler and Bellenger 2002; Pi-Sunyer 1993).
Cited by: 3
Impact of Student Attendance on Course Grades
Dr. Peter J. Billington, Colorado State University, Pueblo, Colorado
The undergraduate required operations management course is mathematically challenging for many students and attendance in class may help students master the material. In recent years we have seen a trend of more students missing classes due to a number of reasons, some legitimate, some not. Attendance was recorded for 6 class sections for a 15 week semester class, three one hour sessions per week. Course grades are then correlated with absences, GPA, and several other factors. High GPA student grades were not affected by attendance, but lower GPA student grades did fall as class absences increased. The undergraduate required operations management course is mathematically challenging for many students, even after completion of the required prerequisites of college algebra and business statistics. Many students manage to “get by” those courses and still have weak mathematical capabilities. The operations management course requires analytical skills in many topics. The best approach to mastering these skills is to attend class, do homework problems, and then compare solution methods in subsequent classes. Many faculty believe that attendance in classes is important to learn the material. While some students may be good at reading the text, getting lecture notes from friends, or other means of learning the material but not attending class, other students do not fair as well if they miss class. The field of operations management is changing rapidly, with the introduction of practitioner-driven topics such as Six Sigma and Lean. Often, textbooks are several years behind and the instructor uses other sources to supplement the text material in these topics.
Cited by: 6
Effects of Corporate Governance on Indirect Costs of Financial Distress in China’s Distressed Companies
Huang Hui, Huazhong University of Science and Technology, Wuhan, China
Zhao Jing-jing, Huazhong University of Science and Technology, Wuhan, China
The environment, both inside and outside, are very different for companies experiencing financial distress. In addition to affecting the company’s value, financial distress leads to a change in the influence of corporate governance, an indirect cost of financial distress. Based on panel data of 193 financially distressed companies in China from 2000 to 2006, this paper examines the empirical relationships between corporate governance characteristics and indirect costs of financial distress. We find that ownership balancing has a positive influence on indirect costs of financial distress, while the proportion of state-owned shares, the proportion of independent directors and the percentage of overhead costs all have negative relationships with indirect costs of financial distress. Our findings can help distressed companied in China and elsewhere improve their corporate governance and become financially healthy. Even companies that generally run smoothly commonly experience periods of financial distress. Financial distress is usually regarded as the embarrassing situation of not being able to pay mature debts or expenses because of liquidity problems, insufficiency of equity, defaults on’ debts and lack of current assets. The costs of financial distress are both direct and indirect. Direct costs include diminishing assets caused by conflict between the owners and the creditors, legal costs and other administrative costs. Indirect costs are losses resulting from the potential for bankruptcy, which include a decreasing client base; the decreasing company value caused by short-sighted, self-protective actions; increased cost of credit; and lost opportunities. Some scholars (e.g., Branch, 2002) have also regarded the losses of creditors and stakeholders as indirect costs.
Promoting Development Potentials with Web Applications: An E-Marketplace for Horticulture Businesses in a Developing Country
Sajjad Zahir, Ph.D., University of Lethbridge, Alberta, Canada
We propose a promotional framework for e-commerce in developing countries and illustrate the concept with a prototype e-marketplace for horticultural trades in light of new realities. Trading information was gathered from a key horticultural trading centre during a field study. Various socio-economic-technical issues were considered in the design as per the framework concepts. E-commerce (Turban, King, Lee, & Viehland, 2003) and other uses of the Internet have been promoted for social uplift in developing countries by various international agencies (UNCTAD, 2001). Ngai and Wat (2002) identified 275 articles on e-commerce in leading information systems journals. These articles deal with myriad e-commerce related topics including conceptual frameworks (Wigand, 1997; Zwass, 1996), e-commerce practice issues (Vadapalli & Ramamurty, 1998) and e-commerce strategies (Javalgi & Ramsey, 2001). Zwass (1996) presents a framework consisting of seven layers tailored mostly to the developed countries. The seventh layer of this proposed hierarchy refers to electronic marketplaces. The Global Diffusion of Internet (GDI) Project made extensive investigation of the global spread of Internet in terms of a six-dimensional framework (Wolcott et al., 2001). Travica (2002) discussed a framework for e-commerce in developing countries and listed various infrastructural conditions for e-commerce success. Okoli and Mbarika (2003) developed an integrated framework for assessing e-commerce in Sub-Saharan Africa. While all these frameworks are mostly conceptual in nature, very few articles mention design and development issues about e-commerce applications. In this paper we discuss the actual development and design of an e-commerce application (specifically an e-marketplace) within the context of the conceptual frameworks.
Cited by: 3
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