The American Academy of Business Journal
Vol. 18 * Num.. 1 * September 2012
The Library of Congress, Washington, DC * ISSN: 1540 – 7780
Online Computer Library Center * OCLC: 805078765
National Library of Australia * NLA: 42709473
The Cambridge Social Science Citation Index, CSSCI
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Job Stress and Job Dissatisfaction: Meaning, Measurement and Reduction -- A Teaching Note
Dr. Gene Milbourn, University of Baltimore, MD
Two ubiquitous topics in organizational behavior and in human resource management courses are job stress and job satisfaction/dissatisfaction. Our textbooks do well with the theoretical issues surrounding both but less well with the applied issues of their measurement and reduction in organizations. Numerous studies have found that job stress influences employee job satisfaction and consequently absenteeism, turnover and other negative outcomes. Since job satisfaction is viewed as an outcome of performance, impediments to performance generally create stress. This article discusses the seminal work of Smith, Kendall, and Hulin on job satisfaction measurement (JDI), Rizzo, House, and Lirtzman on job stress measurement, and Friedman and Rosenman on the Type A personality and remediation. While not intended to be a literature review, for pedagogical purposes selective research bearing on job stress and satisfaction is included. Lastly, the paper will suggest an outline on structuring a project for students to measure and reduce both stress and job dissatisfaction levels for use by instructors in higher education. Sager (1991) defined job stress as a psychological state perceived by individuals when faced with demands, constraints, and opportunities that have important but uncertain outcomes. Chen (2008) concludes that job stress is an individual reaction, and differs from general stress as it is also organizational-and-job related. Wu and Shih (2010, 74), state that job stress is associated with adverse consequences for both the individual and the firm “since it has the effect of lowering motivation levels and performance, and increases turnover intentions.”
Cited by: 15
The 2008 Financial Meltdowns: Were Early Warning Signs Detected and Disclosed By Management and Auditors?
Dr. Stanton Lindquist, Grand Valley State University, Grand Rapids, MI
Emily Drogt, Grand Valley State University, Grand Rapids, MI
We selected eight financial institutions experiencing difficulty during the global economic meltdown of 2008 to determine if early warning signs existed and were disclosed in the financial reporting process. When examining five separate yet related financial factors, we found that indicators of imminent financial crises did exist in 2006 and 2007. However, none of these warning signs were disclosed in the early 2008 financial reporting process by either management or the external auditors. We concluded that the current financial reporting system is inadequate for informing shareholders and other interested users of impending financial crises. During the global economic crisis of 2008, the United States witnessed the collapse of an unprecedented number of companies. The resulting flurry of bankruptcies, mergers, acquisitions, and bailouts caused widespread chaos in the financial markets. Consequently, investors lost hundreds of billions of dollars in market capitalization as well as confidence in the financial markets. Many of the companies that survived, like GM, AIG, and Citigroup, are only in existence today because of massive government intervention. The failures and subsequent bailouts of companies in certain industries, like the automotive industry, did not surprise the public after years of continuing net losses and declining share prices. However, the collapse of companies in the banking and financial services sector appears to have caught investors by surprise. Indeed, companies in this industry seem to have gone from relative profitability to the brink of bankruptcy in a startlingly short period of time.
Cited by: 4
Organizations Should Capitalize on Employees’ Zone of Proximal Development While in the Midst of Change
Dr. Jerry Franklin III, Wayland Baptist University, Mililani, Hawaii
Based on developmental theories, humans either develop then learn, learn then develop, or mature mentally through a combination of the two. Education-practitioners, school administrators, and community leaders all focus on trying to decide which concept is true. Can these concepts lead to enhanced cognitive development and a better understanding of how they affect human learning and change? This treatise compares, contrasts, and synthesizes the cognitive development ideals of Jean Piaget, Lev Vygotsky, Donald Schon, and Jeanie Daniel Duck. Research suggests Vygotsky’s “Zone of Proximal Development” (and its communal learning properties) is the overshadowing theme supporting our leaders in their quest for change. Yukl (2010) states “Leading change is one of the most important and difficult leadership responsibilities. For some theorists, it is the essence of leadership and everything else is secondary” (p. 298). The author goes on to say “Major change in an organization is usually guided by the top management team, but any member of the organization can initiate change or contribute to its success” (Yukl, 2010). As a developed society, the U.S. is susceptible to change and in many instances welcome the improvements anticipated with its inception. On the other hand, because a developed society tends to analyze conditions that impact quality of life, which often results in anxieties being created (Rogers as cited in Franklin, 2009, p. 5).
Failure and Recovery: An Opportunity to Reconnect and Recommit to Customers After Service
Failure in the Internet-Based Service Encounters
Dr. Akins T. Ogungbure, Troy University, Atlanta Site, Atlanta, GA
This paper examines how customers’ attribution for service failures and expected recovery in online service encounters are influenced by whether the recovery efforts are satisfying or dissatisfying to the customers; the relationship between satisfaction and other behavioral outcomes such as intention to remain and word-of-mouth is examined. The Internet retailing and service recovery warrants special attention because of its inherent ramifications such as the ease of attributing failure to the service provider after a service failure, the lack of interpersonal relationship, and the ease of leaving one service provider for another. The research explores some of the importance of Internet service recovery mechanisms relative to customer’s attribution for failure, expected service recovery, satisfaction, and intent to remain and how these mechanisms can be employed by the service providers to improve customer satisfaction, minimize negative word-of-mouth, and improve the firm’s profitability. This study employs a web-based sample, and data were collected by means of questionnaires on the Internet. The collected data are analyzed using correlation and regression analysis to provide answers to the research questions. The results of the analyzed data are discussed and presented. Internet-based service encounters especially Internet retailing or e-tailing has gone through a range of highs and lows. Internet-based service encounters were initially thought as the future of commerce however, they lost favor in the business community and with some consumers after poor operations execution that led to a catastrophic 1999 holiday season (Mollenkopf, Rabinovich, Laseter, & Boyer, 2007).
Cited by: 3
Toward a General Holistic Theory of Risk
Dr. David R. Borker, Manhattanville College, Purchase, NY
Dr. Valery N. Vyatkin, Saint Peters College, Jersey City, NJ
This paper argues for the need of a general comprehensive holistic theory of risk without which progress in applied risk management in all areas of organizational activity is illusory. Use of holistic risk in writings on enterprise risk management and decision analysis is examined. Shortcomings of currently conducted applied risk analyses are addressed. The origins of risk theory are summarized followed by the introduction of the concept of the multidimensional nature of risk. Early achievements during the seventeenth and eighteenth centuries in the development of the classic risk model are discussed. A series of three proposed general risk formulas are presented. These three general risk formulas are offered as the initial basis for the development of a general comprehensive holistic theory of risk. The subject of risk classifications to complement this theory is introduced and a need is indicated for further work in the development of a general holistic taxonomy of all risks. The field of risk management requires the development of a general comprehensive, synergistic theory of holistic risk encompassing all of the multiple dimensions of risk phenomena. The absence of a comprehensive holistic theory of risk delays and even disrupts the development of truly applied risk management in any area of management activity. The current knowledge of risk management has matured to the point where it is possible and necessary to begin to generalize in the form of an abstract theory of holistic risk. This will be in the form of synthesized knowledge within which separate concepts, hypotheses and laws become elements of a unified system of knowledge based upon an appropriate practical methodology applicable to any type of risk.
Cited by: 2
Relationship Marketing in the American and Canadian Export Sectors: A Matter of Trust
Dr. Lise Heroux, State University of New York--Plattsburgh, Plattsburgh, NY
Dr. Ali Hammoutene, Ecole des Hautes Etudes Commerciales (HEC), Algiers, Algeria
This research explores eight export relationship dimensions from the perspectives of American and Canadian exporting firms. The results suggest that their evaluation of the relationship constructs is similar for seven of the eight dimensions: dependence, understanding, commitment, communication, distance, uncertainty and conflict. This is consistent with the perception that psychic distance between the United States and Canada is small and that both parties would have similar expectations in a trade relationship. However, significant differences were found for the trust construct. Canadian firms tend to attribute greater importance to trust than their American counterparts. Therefore, American exporters should not neglect trust-building activities with Canadian clients. The relationship between the United States and Canada is the closest and most extensive in the world. They are each other’s largest trading partner, with a staggering bilateral trade volume of approximately $1.5 billion a day in goods and services in 2009, according to the U.S. Census Bureau. Their geographic proximity and participation in the Canada-U.S. Free Trade Agreement and subsequently in the North American Free Trade Agreement (NAFTA) with Mexico have facilitated trade across North America for firms of all sizes. The individual importing and exporting activities of firms on both sides of the border, and the relationships they have established with their trade partners, are responsible for the aggregate volume of bilateral trade in this region of the world. Exporting represents one of the most common means of entering foreign markets. Its advantages over other market entry strategies are based on reduced financial risk, lower commitment of resources and a high degree of flexibility (Stottinger and Schlegelmilch, 1998). Exporting and export behavior have been the focus of a large body of literature (Cavusgil and Nevin, 1981; Douglas and Craig, 1992; Leonidou, 1995a, 1995b; Leonidou and Katsikeas, 1996; Li and Cavusgil, 1991).
Cited by: 4
Management Responses to Current Stock Prices
Dr. Donald Margotta, Northeastern University, Boston, MA
What should managers of corporations and of public policy do in response to current stock market prices and stock price changes? The answer to that question has important implications for corporate governance issues as well as for the intellectual foundation of public policy regarding merger and proxy regulations. It also requires an assessment of the normative value of certain precepts of finance theory. This paper reviews previous literature on this topic and provides evidence which suggests that while current stock prices and price changes indeed provide important signals for decision making by investors, their meaning for company managements, judges, and public policy makers may not be as compelling and depends on, among other factors, the nature of the company and of decisions being considered. Fama (1970) states the ideal role for prices in a free market: “In general terms, the ideal is a market in which prices provide accurate signals for resource allocation: that is, a market in which firms can make production-investment decisions, and investors can choose among the securities that represent ownership of firms' activities under the assumption that security prices at any time ‘fully reflect’ all available information. A market in which prices always ‘fully reflect’ available information is called efficient.” While there is ample evidence that stock market prices allow investors to choose among securities and that markets, from an investor perspective, are efficient as that term is defined by Fama, there is some question on whether market prices provide “accurate signals” by which firms can make production-investment decisions and upon which policy makers can formulate appropriate corporate regulations. This paper first discusses what stock prices mean to investors. It next discusses what they may mean to corporate managers and policy makers.
Cited by: 1
Do Large Projects Affect Agency Conflicts? Evidence from the Movie Industry
Dr. Wayne J. McMullen, Pennsylvania State University, Brandywine Campus, Media, PA
Dr. Raj Varma, University of Delaware, Newark, DE
Agency conflicts can cause managers to choose projects that enhance private benefits such as prestige or job security from risk minimization. Extant research calls for a separate examination of large projects because the capital outlays of such projects can exacerbate or mitigate agency conflicts. Our analysis of large projects in the movie industry indicates that larger projects provide managers with lesser private benefits from prestige and none from risk minimization. We also find that the ex post returns from large projects are not significantly different from those of smaller projects. These results are consistent with a competitive equilibrium in which a significant determinant of project choice is the tradeoff between private benefits from prestige and commercial success. Drawing on the prominent work of Berle and Means (1932) together with the work of Jensen and Meckling (1976), a broad literature has acknowledged the existence of agency conflicts arising from the separation of ownership and control. Extant theoretical research on agency conflicts advocates that managers may have motives different from value or profit maximization with the projects they choose to make. Such managers may choose projects for a variety of private benefits arising from career and other concerns. On the other hand, if value or profit maximization is the eventual motive for the manager, managers choose projects with competitive advantage as such projects would augment a firm’s returns. In this paper, we investigate project choice in the movie industry. Our attention to the financial performance of movie projects follows recent developments in the consideration of the movie industry by scholars in a variety of disciplines (See Elaishberg, Elberse and Leenders, 2005).
Cited by: 2
U. S. Unemployment Is Not What is Officially Reported
Dr. Fred Maidment, Western Connecticut State University, Danbury, Connecticut
Unemployment in the United States has been historically high for longer than any period of time since the Great Depression, yet it shows no real signs of returning to its post-depression/pre-recession historic levels. Unfortunately, the unemployment rates reported by the Bureau of Labor Statistics do not really reflect the true state of unemployment in the economy of the United States. This reality and the ramifications of this lack of connection to reality between what the Bureau of Labor Statistics reports is the subject of this article. The unemployment figure announced by the Bureau of Labor Statistics for the Month of November, 2011 was 8.6%. This number was a significant drop from the previous number of 9.0% and the consistent 9.1 % from July through September, 2011 (Table A1: Employment of the non-institutional civilian population 16 years and over, 1976 to date, December, 2011). The way the United States Bureau of Labor Statistics computes the unemployment rate is to determine the total number of individuals in the labor force each month and then determine how many of those individuals are then unemployed. The people included in this calculation essentially include the persons currently employed and those receiving unemployment benefits. Workers not included in the workforce and therefore the unemployment calculation include: those who have exhausted their unemployment benefits, but may still be looking for work; business owners who have closed their businesses and have not reopened a business or found a job; students who did not hold a job upon graduation and are currently looking for work; people who have started looking for work because a member of the family unit has lost a job; as well as others.
Revising Mortgage Financing and Social Security: A Financial Partnership
Dr. Craig H. Martin, University of Phoenix, Phoenix, AZ
The inclusion of mortgage financing instruments in the primary debt markets has contributed to mortgage rates fluctuations, which lead to severe turbulence in mortgage financing availability. The organization of the Old-Age and Survivors Insurance Trust Fund (OASI Trust Fund) as a pass-through payment system rather than as a sound annuity-based system has resulted in a precipitous decline in fund balance, which is predicted to continue unless economic modification is introduced. Examinations of the operational characteristics of the secondary primary residential mortgage market and the OASI Trust Fund are made to develop modifications for each that enable more favorable performance. Formation of a financial partnership of the Social Security trust fund with Fannie Mae and Freddie Mac agencies results in the provision of a stable interest rate for primary residential mortgages and a defined, risk-free investment pool for an annuity-based trust fund. Research to explore the political will to adopt these changes in the United States is proposed. Research to determine the possible applicability of the plan for other countries, primarily euro-denominated countries, is also proposed. In the 1930’s under President Franklin Roosevelt’s New Deal program, the United States (U.S.) Government developed a means to enable homebuyers to acquire mortgages for their primary residences. The objective of the program was to provide mortgages via the banking system that had characteristic requirements of low down payments, longer terms to maturity in years and relatively low and guaranteed interest rates (Alford, 2008). The flaw in the program as conceived and one that still exists today is that the current mortgage rates are determined more by actions of the Federal Reserve Agency and less by the outcome of a sound financial analysis of the residential mortgage being considered.
Cited by: 20
Financial (IL) literacy of College Students
Dr. Candy A. Bianco, Bentley University, MA
Dr. Susan M. Bosco, Roger Williams University, RI
This study surveys 574 full-time undergraduate college students to evaluate financial literacy. We also examined personal and familial characteristics, and future family and career expectations as predictors of financial literacy. The overall mean percentage of correct answers is 46%. Students with a cumulative grade point average above a 2.0, business majors, males, and upper-class students outperformed their counterparts. Participants whose family income is high, have at least one charge card, and are Caucasian achieved higher scores. The results indicate that college students are financially illiterate. The manifestations of the costs of financial illiteracy are apparent from studying several social phenomena. For the most recent quarter ending March 2002, personal bankruptcy filings hit a new annual high of more than 1.5 million (ABI, 2002). Financial problems are one of the leading causes for divorce in the U.S. (AAML, 2002; Stanley & Markman, 1997) and one of the major reasons for the elderly living in poverty (Mason, 2000). The trend from defined benefit plans to defined contribution plans has resulted in America becoming a nation of investment managers. At the end of the year 2000, over 42 million Americans were managing deferred compensation plan accounts worth $1.8 trillion (Crawford, 2002). Yet, in 1998 over one-half of Americans reported they have not saved enough for retirement, and 53% reported that they often live paycheck to paycheck (Molinari, 2002). Many surveys have tested the financial literacy of adults.
Reinvigorating the Caribbean and Central American Common Market
Keith R. St. John, Bentley University, Waltham, MA
Over the past three decades the prevailing views of regulating global trade have changed dramatically. Protective tariffs are now viewed as counterproductive and anachronistic and many countries are phasing them out. Free trade zones, duty-free zones, and treaties giving preferential reciprocal access are on the rise to varying degrees between many nations. Developing nations are finding new ways of progressing beyond being providers of raw materials for the richer countries. As investment and technology flow into the emerging countries, they are increasingly becoming industrialized and are progressing at fast rates. The fastest-growing emerging countries have become the locomotive force for the economic recovery of entire regions including Central America. Latin American countries have struggled to achieve individual autonomy, and have often been in the orbit of commercial empires. External pressures and internal divisions have divided them and also unified them. Famously, Gran Colombia and Gran Guatemala disintegrated into the patchwork of countries we know today. The pull toward unification then reemerged. During the 1960’s Central America coalesced once again and formed an economic union, the Central American Common Market (CACM). It had a promising start before war and political instability caused it to fracture during the 1970’s, ushering in the Lost Decade of the 1980’s. (1) Since that depressed time, many unifying forces have converged to invigorate the current state of trade in Central America. Costa Rica has emerged as the richest and most politically sophisticated country.
Cited by: 3
The International Competitiveness of Jamaican Manufacturing Firms: A Qualitative Inquiry
Dr. Michael Elisha James, University of Phoenix
This qualitative study assessed the international competitiveness of Jamaican manufacturing firms with reference to the Malcolm Baldrige National Quality Award (MBNQA) criteria for performance excellence. It relied on thematic analysis technique commonly used in phenomenological studies. This thematic analysis is greatly inductive where the themes surfaced from the data through isolated patterns and processes and commonalities and differences and are not forced upon it by the researcher. The following themes were sorted based on interview questions: 1) Differences of TQM and Non-TQM firms, 2) Human resource planning and development are well established in TQM companies, 3) Shared management practices and values of Jamaican manufacturing companies, 4) TQM as an important management tool in a competitive business environment, 5) Perceived factors in business success and performance, and 6) Business operations issues of Jamaican manufacturing companies. The implications of this study for Business Leaders, Government Officials, and Academia are discussed. For example, Corporate Organizational Leaders wanting to implement quality management initiatives should conduct in-depth self-assessment to determine the extent to which managers within their organizations understand how, what, and why TQM practices enhance competitiveness. This study presents results of the qualitative analysis performed on the participants’ perceptions with regard to the extent of quality management practices within the Jamaican manufacturing industry.
Cited by: 3
Trends in Outsourcing and Its Future
David Rosebush, Sam Houston State University, TX
Dr. Hadley Leavell, Sam Houston State University, TX
Dr. Balasundram Maniam, Sam Houston State University, TX
Outsourcing is used in many sectors of the corporate environment but this paper will focus on the following areas: Information Technology, Human Resources, and Science and Engineering. In the past, outsourcing has been widespread in those particular fields. A review of the reasons why companies decide to outsource will be discussed, followed by the benefits and disadvantages they encounter as a result. The main concentration will be determining if outsourcing is profitable for the companies and how it has changed the current job market in the U.S and other developed countries including developing countries such as India. These results will indicate the direction the U.S. is predicted to take in future outsourcing. Local and off-shore outsourcing has been increasing significantly throughout the industrial economies of the world. Outsourcing is a handing over of accountability and authoritative power for manufacture and administration of a segment of a firm’s business, usually activities for which the business has neither a strategic need or a singular capability, to an outside domestic vendor who can provide better service and potentially higher quality at a lower cost allowing the firm to concentrate resources and investments on basic competencies and high growth areas. Outsourcing should not be confused with offshoring; outsourcing agreements create continuing relationships between supplier and beneficiary, with a high degree of risk-sharing. (Frajli, Poloski, Tkalac, 2003) Providers that are outside of the boundaries of the company, usually within the same country, deliver products or services on behalf of the company. Manning, Massini, and Lewin (2008) state that offshoring refers to the practice of sourcing and coordinating responsibilities and industrial roles across national borders, in simpler language the contracting out of work to other countries.
Cited by: 19
The Importance of Non-Equity Alliances and a Descriptive Assessment of Member Needs from a Commodity Beef Association
Dr. Roger D. Hanagriff, Texas A&M University, TX
Dr. Ryan D. Rhoades, Texas A&M University-Kingsville, TX
Dr. Tracy Rutherford, Texas A&M University, TX
Justin Foster, Texas A&M University-Kingsville, TX
The objectives of this study were to demographically describe this beef breed association’s membership and to determine membership’s perceived service preference. Results are derived from 282 member survey responses from a census of all 527 active association members, which is a 53% response rate. Respondents were mostly: from Texas (48.7%), over 45 years of age (79.4%), have less than 50 head (50.0%), earning less than 40% of their income on the ranch (86%), and describe their ranch as a Seedstock enterprise (52%). Members were asked to rate the importance (1-4) of twelve potential services the breed association could provide that would contribute to the success of the breed in the next 10 years. Increasing commercial sales, developing specific markets, and increasing breeder education were ranked the preferred services by the overall membership. Junior members rated the importance of developing advertising, increasing breeder education, and increasing registration & records higher (P<0.01) than senior members. Small and medium sized operations placed greater importance (P=0.01) on increasing registration & records than larger operations. Those operation where more than 40% of their income was derived from the operation, rated increasing commercial sales higher (P<0.01) than those less than 40%. No major differences were found among operation type. These results suggest that membership is very diverse; however the roadmap for refining this commodity breed associations brand in the next 10 years includes services that will ultimately increase sales and education. Some differences in service rankings exist among different demographics. These members could be targeted to design strategies to strengthen those service areas. Research has indicated that consumers are increasingly interested in branded products that offer product attributes aligned with their demand preferences (Howard and Allen 2006, Velasquez, Eastman, and Masiunas 2005, Patterson et al. 1999, Adelaja, Brumfield, and Lininger 1990).
Critical Evaluation of Solutions to the Too Big to Fail Problem
Dr. Muhammad Rashid, University of New Brunswick, Canada
Dr. Mohamed Drira, University of New Brunswick, Canada
Dr. Basu Sharma, University of New Brunswick, Canada
This paper presents a critical analysis of several diverse solutions to the too big to fail, TBTF, problem in the banking sector. The solutions considered are: limit on size, tax on profit, regulating systemic risk, improving bank governance, no bailout, raising capital adequacy requirements, and embedded contingent capital. To assess these solutions, a set of criteria factors which are mostly derived from the extant literature, are: probability of failure, spillover effects, moral hazard, information asymmetry, market discipline, competitive neutrality, efficiency, and ease of implementation. Findings show that no single solution is adequate enough to effectively solve the TBTF problem. In the banking sector, the term too big to fail, TBTF, is frequently used to describe how regulators bailout a large failing bank. The term came into common usage in 1984 when the Continental Illinois National Bank – the seventh largest bank and the largest corresponding bank in the USA at that time, was rescued from failure. A clear statement about the TBTF policy emerged when in the defence of the bailout of Continental Illinois National Bank, the then Comptroller of Currency stated that regulators cannot permit any of eleven largest banks (in the USA) to fail (Kaufman, 2002). The main reason for the TBTF policy has been the regulators’ concern about adverse spillover effects or systemic risk of a large bank failure on other financial institutions and simultaneously and ultimately on the real economy (1). The TBTF policy has short-run gain arising from the avoidance of spillover effects, but it has both short-run costs and long-run costs. According to Goodlet (2010), the short-run costs consist of the taxpayers’ funds which are used for the rescue, while long-run costs arise from the inefficient allocation of resources due to moral hazard behaviour of the TBTF institutions. With respect to the 1980s bailouts of savings and loan associations, Stern and Feldman (2009) report that long-run costs were three times the short-run costs.
The Effect of Online Seller Reputation on Consumer Willingness to Pay: An Empirical Study
Dr. Yingtao Shen, Stetson University, Deland, FL
Dr. Jin Li, North Dakota State University, Fargo, ND
Dr. Carolyn Nicholson, Stetson University, Deland, FL
In many online marketplaces, customers can post reviews of their shopping experiences with online venders and thus build up or damage the venders’ reputations. This study answers two important questions regarding online sellers’ pricing strategy for homogenous products: (1) how do product characteristics affect the reputation-based price premium, and (2) should an online seller with a high reputation score charge a higher price for the same product than sellers with low reputation scores? Using an experiment and conjoint analysis, this study finds that when a product is perceived to be expensive and purchase of that product is perceived to be risky, buyer selection of sellers is more influenced by sellers’ reputation scores than by price; however, when a product is inexpensive and purchase of the product online is perceived as not risky, then price is more important than the reputation score when determining buyer seller preference. With the growing proliferation of the Internet, online business-to-consumer marketing has achieved unprecedented growth over the past fifteen years. Today, while many conventional retailers also sell their products online, there are many vendors now that sell exclusively online. While online shopping provides customers with a convenient purchasing opportunity, that opportunity can present certain significant disadvantages. When shopping in an online marketplace, such as Amazon and eBay, shoppers have to make two important, related choices: (1) the product itself, and (2) which seller from an array of multiple sellers who sell the same product. All transactions involve risks. Cox and Rich (1964) define consumers’ perceived risk as related to two general factors: financial cost and the buyer’s certainty of “winning” or “losing” all or some of the money at stake.
Cited by: 2
Narrative: An Alternative Way to Gain Consumer Insights
Dr. Kritsadarat Wattanasuwan, Thammasat University, Bangkok, Thailand
This paper explores ‘narrative’ as a qualitative research method to gain consumer insights. Fundamentally, narrative is a story of one’s experiences, feelings and beliefs. It illustrates how one acts and interacts with others as well as how one makes sense of one’s world. First the paper sketches out the definition and the underlying philosophy of narrative interview and narrative analysis. Then the paper discusses how to conduct and interpret the narrative interview lucratively. Later the paper assesses the limitations of the narrative method, and proposes how we can justify and enhance the trustworthiness of narrative interviews. ‘Narrative’ is a term being used broadly, and being applied in many different ways. In qualitative research, narrative has become a vital research strategy to grasp the insightful data which can barely be attained by any other methods (e.g., Bonsu and Belk 2003, Joy and Sherry 2003, Muniz and O’Quinn 2001, Penaloza 2001, Price et al. 2000, Thompson and Haytko 1997). Fundamentally, narrative is a story of one’s experiences, feelings and beliefs (Langellier 1989, Mishler 1986, Polkinghorne 1995). It illustrates how one acts and interacts with others as well as how one makes sense of one’s world (Ricoeur 1981, Smith 1981, White 1981). Thus, narrative inquiry is the superlative way to explore phenomenologically one’s experience of particular events. Although narratives can be conveyed in various means, marketing researchers usually elicit one’s narrative through interview. In this paper I address narrative interview as a qualitative method for consumer research. First I sketch out the definition and the underlying philosophy of narrative interview and narrative analysis.
Banking and Financial Market Regulation: An analysis of the Effectiveness of Prudential Controls in Australia
Carlo Soliman, Solicitor and part-time Academic, New South Wales
The cataclysmic effects of the Global Financial Crisis (GFC), the failures in the euro zone and the increasing global instability and uncertainty in other economies such as China have reverberated in ways never before witnessed in history. The consequences have been dire and the future is by no means clear. Remarkably until now, Australia has been relatively unaffected by this turmoil. This article argues that Australia’s prudential regulations which are administered by the Australian Prudential Regulation Authority (‘APRA’) have been an important cornerstone in the minimisation of the adverse effects of the market failures seen abroad. A continuation of a proactive risk-based regulatory approach which encourages a culture of compliance has resulted in further reforms which, whilst expensive to the banking and finance industry and the investing public, will build upon and ultimately strengthen Australia’s arsenal to withstand the uncertainties that are yet to come. Australia has been fortunate, over the course of its history partly through geographic isolation and reliance on its various primary export industries, to enjoy reasonable economic stability relative to other European nations. Much of this stability owes its success to the conservative practices of the nation’s forefathers. The first major financial system inquiry was the Royal Commission on Monetary and Banking Systems, entitled Commonwealth of Australia, Report of the Royal Commission Appointed to Inquire into the Monetary and Banking Systems in Australia, Commonwealth Government Printer Canberra (1935) chaired by Mr Justice Napier in 1935. This inquiry was established to determine the changes needed to maintain stability in the economy following the Great Depression.
The Opportunity Recognition Framework in the Hong Kong SMEs Context
Dr. Wing Lam, The Hong Kong Polytechnic University, Hong Kong
Dr. Ada Hiu-Kan Wong, Lingnan University, Hong Kong
Phyllis Chung-Sze Tong, The Hong Kong Polytechnic University, Hong Kong
Dr. Ziguang Chen, City University of Hong Kong, Hong Kong
This paper presents a preliminary framework of opportunity recognition in the Hong Kong small and medium enterprises (SMEs) context. Guanxi and four trait variables, namely self-monitoring, extroversion, self-efficacy and creativity are the independent variables while the number of opportunity recognized by entrepreneurs is the dependent variable in the framework. The model indicates a mediation effect of guanxi between self-monitoring and the number of opportunities recognized, and between extroversion and the number of opportunities recognized. Meanwhile, SMEs marketing characteristics are determined by personalities and behaviour of the entrepreneurs as they do not conform to the traditional marketing theories (Gilmore et al., 2001). This paper provides new research directions to the field of SMEs marketing. The Closer Economic Partnership Arrangement (CEPA) between China and Hong Kong has provided many opportunities to Hong Kong enterprises in mainland China. These facts show that Hong Kong entrepreneurs of SMEs have to adapt to a variety of China business environments regarding the increase in business opportunities. Relationship is prominent in business development in China. The concept of “Guanxi” describes the special relationships embedded in the network in doing business, especially in the Chinese context (Davies et al., 1995). It is deeply embedded in the Chinese Confucianism philosophy and has perpetual influence in modern China. As CEPA brings numerous business opportunities to Hong Kong SMEs, identifying factors that affect these CEO’s number of business opportunities recognized should be considered as an important research area (Christen et al., 1994; Gaglio, 1997; Gartner et al., 2003; Kirzner, 1997; Shane and Venkataraman, 2000). Some studies (Ardichvili et al., 2003 and Kasouf, 2003) reveal that personal traits can explain entrepreneurs’ ability in opportunity recognition.
Approaching Family Businesses: Contextual Factors and Implications on Research Strategies
Markus Baur, University of Latvia, LV
This article discusses methodological aspects in family business research by asking whether there are specific factors in the context of family firms that might influence research strategies. The paper concentrates on the description of family business idiosyncrasies – relevant as constraining problems to research - and their specific impact on research strategies. These influencing aspects are either family firm system related or related to the evolutionary stage of the scientific discipline. When researching on family businesses, one must consider certain contextual factors that might influence the research process. On the one hand those factors are due to the existence of the reciprocal effect of the systems family and business; a basic definitional element of the family business. For example, families behave different than shareholders; they prefer privacy and confidentiality – public companies are supposed to provide a high level of transparency. Thus, if one is intending to study a business where a business family is (highly) involved, he/she has to consider the family system respectively the behaviour of the family in the data gathering process. On the other hand, there are factors that are related to the evolutionary stage of the scientific discipline such as the missing framework guiding the research process. Factors like these are influencing research strategies and should hence be considered when designing a study. This work tries to identify those factors that are existent in the context of family firms and evaluates their implication on quantitative and qualitative research approaches. The Germany based WIFU Wittener Institut für Familienunternehmen being active in the field since over ten years determines the research in the field to be complex and recognises the existence of the multitude of academic disciplines, methods and research questions (WIFU.de, 2011).
Cited by: 5
Market-Based Instruments and Economic Indicators for Climate Change and Water Pollution Control.
Dr. Maria Luisa Fernandez de Soto Blass, University CEU San Pablo, Madrid, Spain
The Green Paper on market-based instruments for environment and related policy purposes explores possible ways forward with The Water Framework Directive (WFD) with the aim of launching its announced review. In this sense the paper fits into the framework set by the new integrated water and climate change agenda (EUROPEAN COUNCIL, 2007) where market-based instruments and fiscal policies in general will play a decisive role in delivering the EU's policy objectives. The paper also explores options for a more intensive use of market-based instruments in different areas of environmental policy at both Community and national levels.The main Market-Based Instruments for Water Pollution Control considered were. 1.- Water quality trading, 2.- Water pollution taxes and levies, 3.- Water Resource Extraction Taxes and Fees 4.- Wastewater Taxes and Fees.5.- Public– Private Partnerships (PPPs). The indicators presented here relate to waste water treatment. They show the percentage of the national population actually connected to public waste water treatment plants in the early 2000s. The extent of secondary (biological) and/or tertiary (chemical) treatment provides an indication of efforts to reduce pollution loads. The EU is a leading force in the world in taking action on environmental sustainability and, in particular, on climate change. This has been confirmed recently through the adoption of the energy and climate policy package) as the Communication from the Commission An energy policy for Europe - COM(2007) 1, 10.1.2007 - and Communication from the Commission Limiting Global Climate Change as endorsed by the Spring European Council (European Council 8/9 March 2007, Presidency conclusions) in which the EU repeated its commitment to addressing climate change internally and on an international scale, to promoting environmental sustainability, to reducing dependence on external resources and to ensuring the competitiveness of European economies.
A Study on Consumer Behavior for Green Products from a Lifestyle Perspective
Dr. Wen-Lan Wang, Ling Tung University, Taiwan
This study discusses the relationship between lifestyle and green consumption behavior to identify potential green consumers. Using green products as the research objective. This study sampled people over the age of 16 from the general population in Central Taiwan and collected 433 valid samples. A structural equation model (SEM) was employed to analyze the data and facilitate a discussion on the effect of lifestyle on green consumption behavior. This study discovered that plan-oriented lifestyle had a direct and negative impact on green consumption behaviors that show consumers are unaligned with reality and green consumption behaviors that demonstrate complacency with current status. Conversely, work-oriented lifestyle had a direct and positive influence on green consumption behaviors that demonstrate complacency with current status. Fashion-oriented lifestyles had a direct and positive effect on green consumption behavior that shows consumers are unaligned with reality and green consumption behaviors that demonstrate complacency with current status. These findings suggest that the green consumption behavior of consumer groups with varying lifestyles differs significantly. Regarding green consumption behavior, the three lifestyles described (plan-oriented, work-oriented, and fashion-oriented) represent the potential green product consumers, who have different objectives when purchasing green products. Thus, when selling green products to consumers with different lifestyles, businesses should emphasize various points and adopt different marketing strategies and tactics depending on the objective of the various consumers. With increasing concerns regarding dwindling natural resources and protecting the environment, people have begun considering their consumption behavior more.
Cited by: 11
Assessing Hotel Managerial Efficiency Change in Taiwan
Mei-cheng Wu, Chungyu Institute of Technology and National Cheng Kung University, Taiwan
Chia-yon Chen, National Cheng Kung University, Taiwan
The tourism industry experienced a downward trend because of the global economic downturn, but few recent studies discussed the change in productivity of Taiwan's hotels from 2007 to 2009. Therefore, this study used Data envelopment analysis (DEA) data and the Malmquist productivity index to examine the changing productivity of Taiwan's international tourist hotels. Research results show that the efficiency of Taiwan's international tourist hotels during that period has shown a declining trend and the main factor influencing the total efficiency of hotels was inadequate pure technical efficiency. In addition, although technical progress exists in the hotel industry, the degree of catch-up declined. Thus, hotel efficiency must be increased to improve the competitiveness of Taiwan's hotel industry. The global tourism industry has experienced a significant decline in the number of tourists in recent years because of the U.S. subprime mortgage crisis and the global economic downturn. However, because of the impact of the global economic slump on Japan, which is the main source of tourists to Taiwan, the number of Japanese visitors to Taiwan decreased by 7.92% in 2009 compared to the previous year. Fortunately, this decline was offset by the Taiwanese government relaxing regulations regarding visitors from China in July 2008. This resulted in a 14.3% growth in the number of overall visitors to Taiwan in 2009 compared to 2008. In response to the business opportunities of catering to tourists from China, the number of international tourist hotels in Taiwan expanded to 64 locations by 2009, with a total of 18,645 rooms, which is a 5.14% rise compared to 2007.
Different Ethnicities: An Impact of Ethnic Language on Consumer Response to Price-Off Advertising
Panitharn Juntongjin, Thammasat University, Bangkok, Thailand
Dr. Kritsadarat Wattanasuwan, Thammasat University, Bangkok, Thailand
Many researchers try to explain the impact of ethnic language in advertising and prove that it does affect consumers’ attention. However, there are some important issues that remain unsolved. First, whether the impact comes from just noticeable difference of the alphabets or from the language per se. The other is whether different consumers who have different language systems (ideographs versus alphabets) will have the same perception on ethnic language stimuli in price-off promotion message or not. This paper proposes research propositions and provides research tools in order to answer these issues. Language has been one of the main topics in consumer behavior literature for many years. A lot of consumer behavior researchers during the past decade pay attention to how language in advertising can affect consumers in many contexts. For example, in a subculture context, one of the main research in this area is the work of Koslow, Shamdasani, and Touchstone (1994), they did research on how ethnic language in advertising can influence Hispanic consumers in the US by using accommodation theory, and they found that ethnic language had positive impacts on the perception of Hispanic consumers. Another example of the context that had been studied quite a lot in the language field is bilingual consumers; such as the works of Zhang and Schmitt (2004); Luna and Peracchio (1999, 2001, 2002, 2005); Noriega and Blair (2008); as well as Puntoni, Langhe, and Osselaer (2008). All of these research papers focused on how bilingual consumers react to bilingual advertisings. Although they focused on different based theories, they found that bilingual advertisings have different impacts on the consumers’ perception compared to those using only English language to communicate.
Barriers to E-Government Implementation and Usage in Egypt
Dr. Ahmed Samir Roushdy, Sadat Academy for Management Sciences, Egypt
The Purpose of this research is to determine Barriers to e-government implementation and usage in Egypt. An empirical case study using an interview-based research agenda is adopted. After reviewing the literature on e-government, the paper firstly proposes a conceptual model, which is consequently used to determine empirically in Egypt, the key factors affecting e-government implementation and usage from organizational, technological, social, and political perspectives. The present paper introduces a comprehensive over view of barriers facing the implementation & usage of e-government in Egypt. Electronic government is defined as the use of information and communication technology, particularly the internet, as the means to improve government administration efficiency and deliver services to citizens, business, and other entities (carter & Belanger, 2005; UN e-government survey, 2008). When analyzing the extent literature on e-government, different studies have identified various factors that impact implementation & usage (weerakkody et al., 2007; Irani et al., 2007; Chen et al., 2006; Gichoy a., 2005; Chercu & Lee, 2005; Refaat, 2003; Moon, 2002). A common argument that has also surfaced in the literature is that e-government offers many benefits and can potentially offer opportunities to developing countries (Ndou, 2004; Kurunanada and Weerakkody, 2006; Irani et al., 2007). Yet although the benefits of electronic services are well documented, the implementation of e-government has faced many challenges in both developed & developing countries. The reason for such challenges are often explained by researchers as influenced by the complexity of the changes that are faced by the public sector, which are primarily driven by the internet and its array of associated information and communication technology (ICT; Beynon – Davies & Williams, 2004).
Cited by: 9
Innovativeness and Business Performances: Empirical evidence from Bosnia and Herzegovina’s Small-Sized Firms
Dr. Ivan Matic, University of Split, Croatia
Velimir Jukic, Parliament of Bosnia and Herzegovina, Bosnia and Herzegovina
Innovation and innovative activities in today’s business environment have become conditio sine qua non of contemporary organizations’ survival and development. Although there is a multitude of innovation researches in the literature, those oriented on small-sized firms, especially researches that are focused on relationship between small-sized firms’ innovativeness and their business performances, are scarce. Therefore, the purpose of this paper is to examine mentioned and in relevant literature presumed relationship between small-sized firms’ innovativeness and their business performances, and to provide new empirical insights. In order to achieve this objective empirical research was conducted on the sample of 151 small-sized firms in Bosnia and Herzegovina, findings of which suggest on interesting inferences such as that different types of innovation introduced (product or process) in small-sized firms have the same influence on their business performances. Keywords: innovation, innovation types, organizational innovativeness, business performances, balanced business performance measurement systems. Organizations in today's highly competitive environment, characterized by high complexity and dynamism, need to devote special attention to building and strengthening of their competitive advantages, which is a prerequisite to their survival, growth and further development. One of the main ways how modern organizations can improve and increase their performances (results) and achieve competitive advantage is to develop innovative activities and introduce innovations in their business. The relevant literature is full of researches in which authors have investigated innovativeness and innovative activities in organizations and in which they are pointing-out innovation’s crucial importance in gaining competitive advantage. Some of them are even prepared to claim that organizational innovativeness is the main source of organization’s competitive advantage. In that sense Hill and Jones (1998, pp. 113) claim that contemporary competition essentially comes down to competition in innovations.
Cited by: 9
Jordanian Income Tax and Sales Assessors’ Reliance on the Requirements of IAS No. (12)
Dr. Jamal Adel Al-Sharairi, University of Al Al-Bayt, Amman, Jordan
This study aims to show Jordanian Income Tax and Sales assessors 'reliance on the requirements of International Accounting Standard No. (12), a questionnaire was designed and distributed to the assessors who are distributed to seven departments within Amman Municipality, the distributed questionnaires were amounted to (400), (340) questionnaires were recovered from, with a recovery of 85%. The data of the questionnaires were analyzed using the (SPSS), with a number of statistical techniques through descriptive statistics, arithmetic means, standard deviations and percentages, the study hypotheses were tested by multiple regression tests. The study found that the income tax and sales assessors depend on the requirements of International Accounting Standard No. (12), as there are no difficulties that limit the dependence on the requirements of International Accounting Standard No. (12) by the Jordanian income tax and sales assessors. The study recommended increasing the appropriateness of income tax law and Jordanian sales with International Accounting Standard No. (12) in particular, and international accounting standards in general. Tax revenues are essential to the state treasury in Jordan as one of the main sources for the infrastructure of the national economy, and due to the increasing investment and expanding companies as the Kingdom enjoys security, safety and a suitable environment for investment, state’s interest of the tax has increased to be able to continue in spending and providing appropriate services and atmosphere for the tax payers, and a just distribution of wealth among citizens.
Impact of External Knowledge in the Product Life Cycle of Electronic Devices
Ilan Bijaoui, Ashkelon Academic College, Israel
Itshak Tabatchnik, Bar Ilan University, Israel
Knowledge is an important source of competitive advantage in general, and especially in the case of innovative products. The present study addresses the phenomenon of seeking external knowledge in order to generate growth. We prove in this research that intensive use of external knowledge correlates positively with business success in the sector of electronic devices. We show further that electronic devices that are based primarily mainly on the use of internal knowledge end up failing. External knowledge is critical mainly in a market at the Growth and Mature phase of the Product Life Cycle (PLC). The empirical research was carried out on a sample of 65 high-tech products selected from those produced by Israeli firms specializing in electronic devices. Sustainable competitive advantage requires adapting the knowledge capabilities of the firm over time in order to overcome changes in the technological and market environments. Internal knowledge is no more the main base for competitive advantage. External knowledge is required in order to develop new competitive advantage. The literature distinguishes between external continuous and discontinuous (Miller, 1999) or disruptive knowledge (Christensen, 1999) as a source of competitive advantage. Continuous knowledge refers to the current technological and market environment of the firm. Discontinuous knowledge refers to new market and technology, beyond the scope of the firm. Disruptive knowledge refers to new technological knowledge expanding the current market to new low-end customers. In the context of open innovation (Chesbrough, 2003, 2006), the boundaries of the firm become permeable to continuous and discontinuous knowledge from external sources (Lichtenthaler 2008). The resource-based view (RBV) of the firm (Barney, 1986, 1991) explains the conditions under which companies can achieve a sustained competitive advantage based on their bundles of resources and capabilities, and internal source of knowledge.
Destination Image and Marketing Strategy: An Investigation of MICE Travelers to Taiwan
Dr. Che-Chao Chiang, Cheng Shiu University, Kaohsiung city, Taiwan
Ying-Chieh Chen, Cheng Shiu University, Kaohsiung city, Taiwan
Dr. Lu-Feng Huang, Cheng Shiu University, Kaohsiung city, Taiwan
Kai-Feng Hsueh, Cheng Shiu University, Kaohsiung city, Taiwan
This study investigates the role that destination image can play in the development of tourism marketing strategies to promote Taiwan as an attractive objective for travelers in a MICE tourism context. The better understanding of destination image arises from its nature character in determining traveler future visitation and the notable economic potential for tourism enterprises and destinations. The study aims to examine the destination image as perceived by meeting planners. The findings demonstrate the destination image that is associated with natural beauty, friendly and secure environments to travel, attractive cultural festivals amongst MICE planners as a key for business purposes. Some implications and strategies are also discussed. Destination image in the tourism sector has been defined as a crucial element in the development of promotional marketing of a tourism destination (Martín and Bosque, 2008; Pike and Ryan, 2004; Beerli and Martín, 2004; Chalip, Green, and Hill, 2003). Many authors have revealed that the overall representations connected with knowledge are commonly associated with individual cognitive environments (Oppermann and Chon, 1997; Oppermann, 1993). In other words, the positive destination images can significantly increase the likelihood of actual visitations by tourists. Evaluating positive and negative destination images from a marketing viewpoint is useful for industry and government to strength destination competitiveness. Considerable attention has been given to focusing on a substantive understanding of destination image and its major influence in tourist destination selection behaviour in many countries (Mair and Thompson, 2009; Gallarza, Saura and García, 2001). From a tourism perspective, individual travellers hold perceptions, impressions or ideas of a destination, with their overall impressions being perceptions of destination image (Gartner, 1989; Gartner and Hunt, 1987).
Cited by: 6
The Costs and Benefits of Corporate Social Responsibility
Pornpipat Kaeokla, Gradate School, Chulalongkorn University, Thailand
Dr. Aim-Orn Jaikengkit , Chulalongkorn Business School, Chulalongkorn University, Thailand
This article provides a review of literature and past research regarding approaches in identifying and measuring the costs and benefits of corporate social responsibility (CSR). It has been found that the costs of CSR depend on the form of CSR activities in an individual organization. In an organization that emphasizes philanthropy, there are donations of money or items. This is considered a CSR expenditure for charity and community. Meanwhile, in an organization where the CSR principle is incorporated into its core business, social and environmental costs are also incurred. The various benefits of CSR are considered mostly in terms of their effect on corporate profits; however, at present the weighing of CSR’s costs and benefits still lack clear and well-accepted approaches. Only estimates can be made based on changes in revenue, the cost savings or the cost of opportunity incurred, which are then used to provide a measurement in numerical or monetary terms for an organization’s decision-making regarding CSR. Corporate social responsibility, or CSR, and business operations have become linked and need to be considered together. Not only does the CSR principle help contribute to social and environmental welfare but the business also benefits from CSR in terms of goodwill, trustworthiness, and competitiveness (Porterand Kramer, 2006; Sprinkleand Maines, 2010; Weber, 2008). In this way, conducting CSR is a “WIN-WIN” situation. In other words, while business operations focus on making maximum profit, a portion of returns should be provided for the benefit of society as well. Organizations have realized the importance of CSR and put it into practice. Each individual organization may have different forms of CSR (Halmeand Laurila, 2009) . Some organizations focus on donations while others focus on doing activities in communities and with the general public to give back to society.
Cited by: 11
Quantitative and Qualitative Approaches of Incubators as Value-added: Best Practice Model
Dr. Hanadi Mubarak Al-Mubaraki, Kuwait University, Kuwait
Dr. Michael Busler, Richard Stockton College, NJ
In the US as well as internationally, business incubation has proven to be a highly successful element in economic development and job creation. Today, an estimated 7,000 incubators exist worldwide. Among those, approximately 1,800 are in the US and 900 in Europe. Business incubation has been defined as the provision of high-level business/support services, including network for contacts, to accelerate the development of entrepreneurial companies. This research evaluates the quantitative and qualitative findings of a survey, which shows incubators as a value-added to the market because notably of support services received. Ten international case studies were examined; and their success practices identified as well as some of their obstacles. The case studies were chosen based on their well-known international success outcomes. The results of the survey and case studies indicate the value-added of job creation, technology transfer, commercialization, reduction of indirect start-up costs for companies, and graduation companies in the market. The results also show quantitative and qualitative responses used to determine success rates and key indicators of incubators in various countries. The best practice model based on the lessons learned from case studies indicate that the success of incubatees to sustainable graduation is reliant upon: (1) clear objectives, (2) incubators location, (3) access to services, (4) employment creation, and (5) economic development strategy. When accomplished, the best practice model can lead to a 90% survival rate of companies and reflects sustainability in the market. Concept of incubating businesses is one of the highly successful elements in an overall economic development strategy.
Cited by: 19
Lessons From Experience With Wage Flexibility in Asia
Sohail Ahmed, University Teknology MARA, Malaysia
The rapidly developing countries of Asia are firmly committed to export-led growth strategy. As labor markets tighten, two related policy objectives arise: One is to promote growth in productivity in order to maintain a unit labor cost edge in the highly competitive international markets; and the other is to maintain employment stability in the face of internal and external shocks. This has brought workings of the labor markets sharply into focus in these countries, compelling them to address rigidities that hamper the realization of these objectives. A common feature of labor markets is wage rigidity in manufacturing and in the public sector, resulting in wide salary ranges, cascading wage increments, and bonus payments that do not necessarily reflect the financial health of firms. This paper reviews the experience of Japan and Korea with flexible wages. Additionally, as an illustration, features of the Malaysian labor market are examined following Malaysia’s move to a more flexible wage structure. It is argued that flexible wages will help in achieving the objectives of maintaining a competitive edge in unit labor costs and maintaining employment stability. However, successful implementation will require sound industrial relations and a broad consensus on how productivity gains are shared. Equally important are those institutions that help to synchronize macro (unit labor cost) and micro (profit-sharing) considerations. A smoothly functioning labor market, one that facilitates labor productivity improvements and employment stability in the face of internal and external shocks, is indispensable to a strategy of export-led growth. It is often argued that an essential feature of such labor markets is a flexible wage structure. Drawing on the experience of Japan and Korea, this paper examines the case for introducing wage flexibility. It is argued that a flexible wage structure is highly desirable, both for maintaining a competitive edge in unit labor costs and for achieving employment stability. In many developing countries, there is considerable wage rigidity in the unionized manufacturing sector and in the large public-sector bureaucracy.
The Impact of Change in Federal Funds Rate Target on the Stock Return
Volatility in the Stock Exchange of Thailand: A Firm Level Analysis
Yaowaluk Techarongrojwong, Assumption University, Thailand
Numerous empirical studies have examined the impact of change in monetary policy action on the stock return volatility, but research on the impact of change in international monetary policy action on the domestic stock return volatility, especially in the firm level analysis of the emerging stock market, remains relatively unexplored. Thus, this research focused on this unexplored dimension by using the Federal Funds futures to compute the unexpected change in the Federal Funds rate target for 20,417 firm-announcement observations. Two key findings emerged from this research. First, the stock return volatility of the capital intensive industry in Thailand was more positively affected by the unexpected change in the monetary policy by Federal Reserve. Second, the firm level stock return volatility in Thailand positively responded to the unexpected change in the Federal Funds rate target during the contractionary monetary policy action in Thailand. Keywords: international monetary policy action, domestic monetary policy action, Federal Funds rate target, stock return volatility, Thailand, industrial structure. The effects of change in monetary policy action on the asset price has been widely examined in the domestic context over the past decades (Rigobon & Sack, 2004; Bernanke & Kuttner, 2005; Bredin, Gavin & O'Reilly, 2005; Bredin, Hyde, Nitzsche & O'Reilly, 2007; Konrad, 2009). Evidences on the effects of change in international monetary policy action on the domestic asset price are limited especially in the context of developing countries.
Relationship between FDI and Industrial Categories in Thailand
Dr. Sutana Boonlua, Mahasarakham Business School, Mahasarakham University, Thailand
Dr. Christopher Gan, Commerce Division, Lincoln University, New Zealand
Dr. Minsoo Lee, HSBC Business School, Peking University, China
Thailand has been one of significant recipients of foreign direct investment (FDI) among developing countries over the last 30 years, and has recorded rapid and sustained growth rates in a number of different industrial categories. Thailand has shown a clear policy transition for foreign investment over time from an import-substitution regime to an export-oriented regime. Before the 1997 Asian Financial Crisis (1985-1996), Thailand had the fastest growing level of exports in manufactured goods among Asian economies. FDI plays a significant role in the Thai economy. Thailand has been pursuing different foreign investment policies at different times depending on the development objectives and economic situation in the country. The main objective of this research is to evaluate the determinants of FDI in Thailand using the Eclectic Paradigm. Panel data is used to estimate and evaluate the empirical results based on the data for the years 1980 to 2004. The primary research question addresses what factors motivate, attract, and sustain the FDI in Thailand. The results show that the inflows of FDI in Thailand, which are supply-driven, are significantly influenced by its 21 largest investing partners. The 1997 Asian Financial Crisis has no impact on the determinants of the inflows of FDI into Thailand. The results also show that increases in GDP and trade between investing partners and Thailand potentially attract more FDI into Thailand. The categories that attracted the largest foreign direct investment (FDI) inflow in Thailand are industry, financial institutions, and trade. Financial institutions attracted an average of 50% per year of the total FDI since 1970, but this dominance has moved to industry and trade with more than 70% since 1993 (BOT, 2005).
The Effect of Age on Charitable Giving in Taiwan: Is Afterlife Consumption a Driving Force?
Dr. Tungshan Chou, National Dong-Hwa University, Hualien, Taiwan
Dr. Gordon Woodbine, Curtin University of Technology, Perth, Western Australia
Researchers in both the United States and Taiwan have devoted attention to charitable giving and the factors influencing the process. Azzi and Ehrenberg's (1975) economic model in particular, their preference for using afterlife consumption as a major driving factor in charitable giving continues to attract the interest of researchers. This paper revisits the area using data from the latest available national social survey completed in Taiwan in 2008. Earlier Taiwanese studies concentrate on giving to religious entities (i.e., temples, churches and equivalent places of worship), whereas this paper examines giving to other charitable bodies, religious and non-religious and includes the views of both religious and non-religious adults. It is reported that religious affiliation acts as the major motivator to charitable giving and although giving increases with age, its association with accumulating afterlife benefits is strongly questioned. Charitable giving is a subject that has been much discussed and researched in a western context by economists and social scientists over the past fifty years or so. Laurence Iannaccone, in his seminal paper “Introduction to the Economics of Religion” (1998) discusses the role of religion in the social and economic sphere within the context of one of the world’s top giving nations, the United States. He refers to the work of economists, Azzi and Ehrenberg (1975) who developed a multi-period utility maximizing model, which they subsequently used to examine a large statewide data bank of American households in order to establish the factors likely to predict levels of giving within various mainly Christian communities. Their findings encouraged a number of economists to pursue similar U.S. studies, an area that continues to attract attention in the new millennium (e.g., Brooks, 2003; Hrung, 2004; Blomberg et al., 2006; Thornton et al, 2010). Continued interest may be warranted as, according to a 2010 report published by the U.K. based Charities Aid Foundation (CAF), the United States ranks fifth out of 153 countries included in a comprehensive survey of social trends. Reported charitable giving is measured using a world giving index that ranks nations according to the incidence of giving of both money and time by individuals.
Measuring the Effects of Learning on Business Performances:
Proposed Performance Measurement Model
Dr. Ivan Matic, University of Split, Faculty of Economics, Croatia
In today's business environment, characterized by increasing dynamic and complexity, learning in organization, i.e. organizational learning has been proposed as a main source of competitive advantage of modern organizations. Statements such as „the ability to learn faster than your competitors could be the only sustainable competitive advantage in given environment„ (De Geus, 1988; Stata, 1989), best describe the importance that researchers give to the concept of organizational learning. On the other hand, in the last 20 years performance measurement has undergo a genuine revolution regarding the reorientation from traditional to contemporary, balanced, performance measures, i. e. performance measurement systems, and as such it moved to the centre of academic and practitioners’ interest. Given the fact that relationship between organizational learning and business performances is not nearly enough empirically investigated and explained, the purpose of this paper is to propose a balanced performance measurement model, specially designed to measure the effects of learning in organization on its business performances. Bearing this in mind, performance measurement literature has been reviewed, especially the most important performance measurement systems, such as BSC, EFQM, Performance Prism, Performance Pyramid System, etc., on the basis of which the balanced performance measurement model, encompassing seven non-financial and three financial measures, aimed to measure the effects of learning on business performances of organization, has been designed.
Cited by: 32
Individual Behavior Change Through Economic Shocks Exposure: Empirical Evidence from Romania
Dr. Pandelica Amalia, University of Pitesti, Economics Faculty, Romania
Dr. Pandelica Ionut, Agora University of Oradea, Business Administration Faculty, Romania
Dr. Diaconu Mihaela, University of Pitesti, Economics Faculty, Romania
The individual well-being is determined by many things like the level and secure income, job stability and characteristics, health, social relationships and family. In some ways and to a different extent all these were affected during the last three years for many people worldwide. The identification of the economic and social consequence of the economic crisis is a very complex and difficult issue taking into account that a precise estimation can’t be done because many of these are not visible yet. Still, a complex analysis of these effects should include some certain directions: implications over individual behavior (a less healthy lifestyle, alcohol abuse, marital conflicts, suicides, criminality rate, domestic violence and divorce rate), implications over consumer behavior (changing the consumer behavior with important consequences over market structure), implications over health (mental health and addiction problems, the adoption of a less healthy food because of the consumption of cheap food, alcohol and nicotine due to stress, poor disease management due to overburdened health care services), implications over beliefs and attitudes (the things in which people believe and they treasure). We can better understand and learn based on previous similar experiences even if each economic crisis episode has its particularities, but also based on the experience of other uncertain situations (different types of crisis).
Does Shareholder Retention Matter in Explaining the Under-Pricing Phenomenon of Malaysian IPOs?
Rasidah Mohd Rashid, Northern University of Malaysia, Sintok, Kedah, Malaysia
Dr. Ruzita Abdul Rahim, National University of Malaysia, UKM Bangi, Selangor, Malaysia
This paper investigates the influence of shareholders’ retention on the performance of initial public offerings (IPOs) in Malaysia between 2001 and 2010. Based on a sample of 295 IPOs listed in Bursa Malaysia, we find that pre-IPO shareholders’ ownership or retention averages 73% and has a negative relationship with the IPO performance. This finding is consistent with the signaling model, which argues that a reduction in the proportion of original owners’ shareholding or retention signals the higher risk of such firms. In other words, the market interprets original shareholders’ lower retention as reflecting their lack of confidence in their firms’ future prospects. Underpricing, which takes place when the offered prices for new issues fall below the price on the first day of trading (Rock, 1986; Carter et al., 1998; and Certo et al., 2001), is a universal phenomenon in IPO markets. A number of explanations have been offered to clarify the puzzle, but very little attention has focused on pre-IPO characteristics—specifically, those whose information can be accessed by potential investors from the prospectus. Numerous studies have been conducted to examine the main explanations, including the winner’s curse, prospect theory, agency theory, and signaling theory; however, nearly all of these studies have been carried out in developed markets. Such studies are still scant in the context of emerging markets, including Malaysia. This shortfall is normally attributed to the lack of available relevant data.
Cited by: 2
Collective Efficacy as A Mediator: The Effect of Relationship Oriented Leadership and
Employee Commitment Toward Organizational Values
Dr. Pieter Sahertian, Kanjuruhan University of Malang, Indonesia
Dr. Christea Frisdiantara, Kanjuruhan University of Malang, Indonesia
Research in leadership has not given serious attention to employee expectation with an emphasis on the mediation of the impact of objectives to behavior. One important employee expectation is the belief in individuals’ capabilities, which can produce sufficient progress and performance outcomes. This research aims to study the mediating effect of employee efficacy by testing two models constructed based on Bandura’s cognitive social theory. Model 1 hypothesizes that relationship-oriented leadership will contribute to employee commitment to organizational values through their collective efficacy while Model 2 hypothesizes that relationship-oriented leadership will have a direct effect on employee commitment to organizational values and indirect effect on employees’ personal efficacy. The sample for this research includes 135 respondents from a loan bank/rural bank (Bank Perkreditan Rakyat) in the area of Probolinggo and Lumajang, East Java. Data were analyzed using AMOS 4.0. The findings provide strong support for Model 2. Relationship-oriented leadership has an impact on employees’ collective efficacy. Meanwhile, employees’ personal self-efficacy can predict their commitment to the collaboration with the customer. Relationship-oriented leadership can also directly and indirectly affect employees’ commitment to the organizational mission and the improvement of effective performance. Previous research has shown that relationship-oriented and task-oriented leadership can make different contributions to the performance expected from employees.
Timing the Taiwan Stock Market: Simple Rotation vs. Sector Rotation
Dr. Su-Jane Chen, Metropolitan State College of Denver, Denver, CO
Dr. Ming-Hsiang Chen, National Chung Cheng University, Chia-Yi, Taiwan
This study investigates two active trading strategies— simple rotation and sector rotation. One prompts investors to rotate their portfolio between the stock market during economic boom and risk-free securities during economic bust while the other effects investment allocation between cyclical sectors in economic upturn and noncyclical sectors in economic downturn. Test results uniformly favor the simple rotation while both active strategies outperform the passive buy-and-hold strategy. Moreover, the study reveals that the supremacy of the simple rotation has transformed from wealth accumulation in the pre-March 2000 era to downside risk protection in the post-February 2000 era. This is encouraging especially in consideration of the ease and cost effectiveness for individual investors to implement this active strategy. In contrast, this research casts some doubt on sector rotation as a viable market timing trading strategy, particularly once transaction costs and sector ETFs and mutual funds scarcity in Taiwan are factored in. Conventional wisdom in finance posits that no one can consistently beat the market. This, in turn, leaves buy and hold as a logical investment choice. However, this strategy has faced its challenges from time to time, most recently in the post-millennium era. Due to the 2000-2002 and 2007-2009 bear markets, a buy-and-hold portfolio formulated at the peak of 2000 in the U.S. would still be in the red today. In contrast, market timers argue that market timing, an actively managed investment strategy, should yield a better performance than a passive buy-and-hold strategy. As a result, market timing strategy has been closely studied in finance literature.
The Impact of Using Information Technology on Accounting Systems Used in Jordanian Telecommunications Companies
Dr. Majed Alsharayri, Balqaa’ Applied University, Salt, Jordan
The study aims at analyzing the reality of using information technology and identifying the impact of information technology and its components on the effectiveness of accounting systems in Jordanian telecommunications companies. A special questionnaire was designed for the purposes of this study and data collection through a random sample selected from the population of the study, which consists of working in accounting systems in Jordaniantelecommunications companies, the statistical package was used for the purpose of analyzing the data statistically to validate its hypotheses. The study found many results, the most important of it, that there is a positive impactfor the information technology on the effectiveness of accounting information systems, where the average of the paragraphs’ meansfor the hardware, software, networks and databasesreached to (3.4924). The study concluded some recommendations based on the conclusions of the study, as working to raise the competencies of users of accounting systems and developing their skills through training on the use of what is new of techniques and software, the need to keep up with companies sample study of technological developments and update the hardware, software and systems for telecommunications and information, in addition to strengthen the activities of accounting information systems and the expansion of research in this field aimed at improving the efficient use of information technology.
Cited by: 4
Factors Influence Student's Choice of Universities in Egypt
Dr. Ahmed Samir Roushdy, Sadat Academy for Management Sciences, Egypt
It is important for higher educational institutions to know what influence students' choice of a university. Various factors have been identified; some are economic based, such as the cost of university tuition, scholarships and grants, accommodation (room and board). Others are none economic factors, such as university size, and location. This research is designed to explore which of these factors are most important for students when choosing a university. It is assumed that economic reasons play the largest role in choosing a university. I hope this research will provide a comprehensive overview of the different factors that play important roles when students choose a university. The analysis of university choice by students examine how the influence of personal and family background characteristics, actual and expected market conditions, and economic incentives interact to shape their choices about the sequence of decisions that result in an educational outcome. More sophisticated analysis of university choice emphasizes the heterogeneity in various respects (academic aptitude, family resources, and so on) of the subjects studied and the interactions among these varied characteristics and various opportunities and incentives in producing observed choices. The choice made by individuals is influenced by the person's characteristics, which themselves are partly a function of past choices and also partly a function of expectations about future opportunities and alternatives (Behrman et al. 1998). Nowadays in Egypt there are more opportunities for high school students to go to universities. However the competition in recruiting more students and retaining them has become more complicated than ever before.
Cited by: 4
Advantages and Disadvantages of Commercial Alternative Dispute Resolutions
Dr. Khodr Fakih, Lebanese American University, Beirut, Lebanon
According to the literature, there is no conclusive list that can embody all Alternative Dispute Resolution types because it involves numerous processes and techniques used to resolve conflict. Generally, ADR systems consist of negotiation, conciliation, facilitation, mediation, and arbitration along with a combination of these methods. All those types of ADR methods aim to resolve conflict in a convenient and effective environment. However, these systems like other judicial/non-judicial structures, offer certain advantages and disadvantages. This paper will illustrate the advantages and disadvantages of such system. The rise of global and trans-national commerce has created tensions and challenges for the international community. On one hand, international commerce has facilitated the movement of people, trade, and services. However, there have been controversial debates on how dispute arising from this development can be resolved efficiently. This has resulted in the popularization of Alternative Dispute Resolution (ADR). Alternative Dispute Resolution is a way of settling dispute outside the courthouse. This system is consensual, confidential, and flexible which ultimately produces a settlement. Because of these advantages, the international community has been increasingly attracted to ADR system as an alternative method to judicial courts. Despite this popularization, various questions have been raised regarding the validity of this method. This is especially true since such method has proven that it contains not only advantages but also disadvantages.
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