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This study interprets various theories of volume of stock markets in a unified DOint of view and classifies the theories into 4 categories: risk premium theory, adverse selection theory, privately informed trading theory, and market stabilization theory. Risk premium theory and adverse selection theory predict that net buying amount of an uninformed trader and future stock return have negative correlation and that ttle correlation approaches-I as current return volatility increases. Privately informed trading theory and market stabilization theory predict that net buying amount of an Informed trader and future stock return have posltive correlation and that the correlation approaches 1 as current return volatility increases.

Utilizing these two predictions. this study suggests a method of measuring informational advantage of a group of investors. To measure degrees of Informational advantage of some investor groups in Korean stock market. the method is applied to 7 groups of investors: foreign investors, individual investors. institutional investors, securities companies, Insurers. ITCs, and banks. The result shows that ITCs have the highest degree of informational advant~ age while Individual investors have the lowest level of informational advantage. The fact that this result is consistent with prior researches means that the method suggested in this study has enough empirical validity. This method may be used in a performance evaluation process for a specific fund or a portfolio manager.

The purpose of this paper is to test an implication of the pecking order theory to explain capital structure decisions among Chinese listed companies during the 2005-2007 NTS Reform transition period.

The authors utilize direct proxies for information asymmetry based on microstructure models including Probability of the arrival of informed trades (PIN), Adverse selection component of the bid-ask spread (λ), Illiquidity ratio (ILLIQ) and liquidity ratio, and Information asymmetry index (InfoAsy) to examine their relation with firms’ debt financing.

Consistent with the prediction of Pecking Order Theory, the authors find that companies for which stock investors are challenged with more severe informational disadvantages are associated with higher degree of leverage use.

The study provides a more direct test on the positive relation between information asymmetry and financial leverage of Chinese firms. In contrast to previous findings by Chen (2004), the results suggest that capital structure choices among Chinese firms progressively conform to conventional finance theories (e.g. Pecking Order Theory) with the decline of non-tradable shares.

The purpose of this paper is to explore the adverse incentives at the front end of government-funded projects with concentrated benefits and no liabilities for the privileged groups. In particular, the author discusses the risk of perverse incentives of the types typically found in the development aid sector that results in counterproductive outcomes.

The paper uses a simple conceptual framework based on agency theory. A qualitative, case-based approach with purposive sampling was chosen for the empirical part of the study. Eight Norwegian projects were selected because incentive problems were to be expected, and one development aid project served as a reference case.

The paper finds that low strategic project success corresponded well with the terms of financing. There were clear indications of agency problems, in three cases to the extent that the incentives turned perverse. The paper concludes with a discussion of relevant measures to prevent the emergence of perverse incentives.

The paper contributes to an improved understanding of the incentives related to public project initiation and selection, which is an under-researched topic and generally not included in formal project governance schemes. The research should therefore be useful to scholars as well as practitioners within the field of project governance.

Contemporary supply chain relationships inherently rely on delegation of work between organizations and, thus, are subject to agency problems for which a wide range of governance mechanisms exist. This review of agency theory (AT), across four distinct fields, explains the connection between governance mechanisms and supply chain relationship types.

The study uses a systematic literature review (SLR) of articles using AT in a supply chain context from the operations and supply chain management, general management, marketing, and economics fields.

The authors categorize the governance mechanisms identified to create a typology of agency relationships in supply chains.

The developed typology provides parsimonious theory on different forms of supply chain agency relationships and takes a step towards a “supply chain-oriented agency theory” explaining and predicting relationship types and governance in supply chains. Furthermore, a future research agenda calls for more accurate measuring of agency costs, to examine residual gains alongside residual losses, to take a dual-sided perspective of agency relations and to adopt AT to examine more complex supply networks.

The review provides a menu of governance mechanisms and describes situations under which these mechanisms could be deployed to guide managers when developing their supply chain relationships.

The first review to combine and elaborate views from four major disciplines using AT as a lens to supply chain relationships. Expanding the traditional set of governance mechanisms provides academics and practitioners with a bigger “menu” of options to consider.

The primary objective of this paper is to identify and compare the collateral imposition practices among Islamic banks in Indonesia to serve micro, small and medium-sized enterprise (MSME) clients and explore the experiences and perceptions of MSME entrepreneurs pertaining to collateralisation in MSME financing.

This study was carried out by implementing a case study research strategy. The data was gathered primarily through the interview by utilising purposive uncontrolled quota sampling. The interview was conducted using semi-structured interview questions by targeting the two sides of Islamic financial inclusion: the Islamic banking industry (supply-side) and the MSME segment (demand-side).

This paper implies that the collateral provision is indeed an obligatory requirement for MSME to access regular financing in an Islamic bank, preferably the immovable type that consists of land and property. Subsequently, although the Islamic banks offer non-collateralised financing, their disbursement is still relatively scant and limited. Furthermore, despite the collateral issues, most MSME entrepreneurs positively perceive the bank’s collateralisation practice, indicating their awareness and understanding of the collateral purpose and function to access the financing facility.

This paper merely observed six Islamic bank institutions and 22 MSME units in urban and rural areas in Indonesia using a case study approach. Therefore, the empirical findings and case discussions were limited to those around the corresponding Islamic banks and MSME participants.

By referring to the several disclosed issues associated with the collateral imposition practices, this paper presents several recommendations that might be considered by the policymakers and the Islamic banking industry to enhance the realisation of MSME Islamic financial inclusion from the collateral implementation aspect, and thereby, facilitating more inclusive growth for the MSME industry.

This paper is unique since the paper attempts to analyse and compare the collateral imposition practices and its perception from the two distinct sides of Islamic financial inclusion that were represented by Islamic banks and MSMEs in Indonesia by including different types of Islamic banks and different segments of MSME in their diverse business sector within the urban and rural locations.

This paper examines the effect of fund manager replacement on investment performances of mutual funds. In managerial labor market of mutual fund industries with information asymmetry about the type and action of a fund manager, separating compensation may not be achievable due to imperfect evaluation of performances of fund managers. This paper extends contract theory to model the situations where a mutual fund offers pooling compensation contract to a fund manager based on his reputation. Under these environments, the fund manager has an economic incentive to acquire private benefit by manipulating performances and then to turn over to other mutual fund. Fund manager’s replacement is an aspect of adverse selection in the managerial labor market of fund industries. That is, a fund manager with low ability can select and manipulate unsuccessful investment portfolio generating loss to fund while he turns over to hide himself in the reputation under pooling contract mechanism. The empirical analysis of this paper provides the significant evidence that, differently from those of mutual funds of which managers stay in the same mutual funds, the fund performances drop after the fund managers turn over to other mutual funds. These empirical evidences support the theoretical prediction that the fund managers have incentive to manipulate short-term performances to maintain reputation for acquiring favorable compensation contracts.

This paper examines the effect of fund manager replacement on investment performances of mutual funds. In managerial labor market of mutual fund industries with information asymmetry about the type and action of a fund manager, separating compensation may not be achievable due to imperfect evaluation of performances of fund managers. This paper extends contract theory to model the situations where a mutual fund offers pooling compensation contract to a fund manager based on his reputation. Under these environments, the fund manager has an economic incentive to acquire private benefit by manipulating performances and then to turn over to other mutual fund. Fund manager’s replacement is an aspect of adverse selection in the managerial labor market of fund industries. That is, a fund manager with low ability can select and manipulate unsuccessful investment portfolio generating loss to fund while he turns over to hide himself in the reputation under pooling contract mechanism. The empirical analysis of this paper provides the significant evidence that, differently from those of mutual funds of which managers stay in the same mutual funds, the fund performances drop after the fund managers turn over to other mutual funds. These empirical evidences support the theoretical prediction that the fund managers have incentive to manipulate short-term performances to maintain reputation for acquiring favorable compensation contracts.

The purpose of this paper is to investigate and clarify “irrationality” problem through the maritime industry practices and leading incentives behind common investors.

This paper includes a review of broader business and economics literature; review of shipping business practices and detection of institutional pathways and misleading mechanisms behind the irrational preferences; investigation of data (for some arguments); and introduction of a theoretical approach.

There are several industry practices and norms well established and followed by decision makers, which may cause and initiate illogical and irrational (long-run) preferences. Short-termism is an erroneous habit of common shipping investors, which is embedded and forced through traditional financial math (i.e. discounted cash flow), financial system (e.g. initial public offerings with high-frequency transactions, interest rate governance and asset valuation mechanism) or flawed contracting tradition (i.e. commission bias).

Both shipping business and financial institutions need to redesign their working mechanisms, evaluation systems, risk detection and assessment procedures. As discussed in Section 4.7, commission-based (float) services must be converted to regular flat rate payments with long-term contracts to protect investors from rational choices of intermediaries in the short-run which encourages investor’s irrationality. Having a long-term service contract will also improve sustainability of intermediaries and lower their business risk (win-win).

The impact of this paper is two-fold. First, it raises critical questions about professional decay and drawbacks of some traditional instruments in the shipping business. For the first time, this paper emphasises on various challenges which deteriorate credibility of the industry and causes ill-defined investments. Some arguments have extreme priority for strengthening the foundations of the industry. Second, this paper establishes a new stream of scholarly research highlighting weaknesses of conventional economic approach and demand for outsourcing other schools of economics (e.g. institutional and behavioural) into the shipping business.