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1 – 10 of over 15000Ujjawal Sawarn and Pradyumna Dash
This study aims to examine the uncertainty spillover among eight important asset classes (cryptocurrencies, US stocks, US bonds, US dollar, agriculture, metal, oil and gold) using…
Abstract
Purpose
This study aims to examine the uncertainty spillover among eight important asset classes (cryptocurrencies, US stocks, US bonds, US dollar, agriculture, metal, oil and gold) using weekly data from 2014 to 2020. This study also examines the US macro uncertainty and US financial stress spillover on these assets.
Design/methodology/approach
The authors use time–frequency connectedness method to study the uncertainty spillover among the asset classes.
Findings
This study’s findings revealed that the uncertainty spillover is time-varying and peaked during the 2016 oil supply glut and COVID-19 pandemic. US stocks are the highest transmitter of uncertainty to all other assets, followed by the US dollar and oil. US stocks (US dollar and oil) transmit uncertainty in long (short) term. Furthermore, US macro uncertainty is the net transmitter of uncertainty to the US stocks, industrial metals and oil markets. In contrast, US financial stress is the net transmitter of uncertainty to the US bonds, cryptocurrencies, the US dollar and gold markets. US financial stress (US macro uncertainty) has long (short)-term effects on asset price volatility.
Originality/value
This study complements the studies on volatility spillover among the important asset classes. This study also includes recently financialized asset classes such as cryptocurrencies, agricultural and industrial commodities. This study examines the macro uncertainty and financial stress spillover on these assets.
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Nidhi Singh, Safiya Mukhtar Alshibani, Pooja Misra, Rabiya Nawaz and Bhumika Gupta
Along with technology-based ecosystems, healthcare start-ups are expanding multi-fold. On the other hand, underlying uncertainties pose several challenges for these health-tech…
Abstract
Purpose
Along with technology-based ecosystems, healthcare start-ups are expanding multi-fold. On the other hand, underlying uncertainties pose several challenges for these health-tech enterprises at macro-meso-micro level, influencing their business circumstances and profitability. The current study aims to comprehend the macro-, meso- and micro-level barriers that make it difficult for enterprises to set up healthcare technology start-ups. The study also observed the perceived effect of these challenges on firms' performance and cost structure over time. Using the theory of behaviour under uncertainty, the study revealed multiple systemic, sector-related, human and implementation barriers that hinder business growth and lead to uncertainties for health-tech start-ups.
Design/methodology/approach
Using a grounded theory approach, the study collected the views of 51 health tech start-ups in the UK using an online participants pool. The data was collected using qualitative data techniques in the form of open-ended essays, and a content analysis using thematic coding process was conducted. The questions centered around the different institutional uncertainties or barriers while setting up or running a healthcare start-up.
Findings
The study revealed several macro-, meso- and micro-level barriers these technology-based enterprises perceive in the healthcare industry. These are recognised as systemic barriers, such as lack of funding and procedural issues; sector-related barriers, such as market-related impediments; human barriers, including psychological barriers and resistance to new technology; and implementation barriers, such as operational and personnel issues.
Research limitations/implications
The study used qualitative, open-ended essay techniques to collect the data. Future studies may use a mixed-methods approach to provide holistic insights. The study is conducted in a single developed country, the UK. Future work may expand these findings by comparing developed market challenges with those of emerging markets and by assessing the viewpoints of healthcare start-ups.
Practical implications
This research will assist the healthcare sector and government understand health tech start-up hurdles and uncertainty. Policymakers must assist start-ups and encourage entrepreneurial innovation. Regulating and enabling policies will help. The paper examines start-ups' macro, meso and micro uncertainties. Policymakers promoting sector entrepreneurship must consider these barriers while designing policy guidelines.
Originality/value
The study contributes to the existing literature on technology start-ups, particularly in the healthcare industry, and identifies significant barriers these start-ups face. The study synthesizes research on health-tech start-up uncertainty and bridges the gap between theory and practice by applying empirical findings.
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Said Elbanna, Ilias Kapoutsis and Kamel Mellahi
The purpose of this paper is to examine the association between positive perceptions of politics (i.e. positive politics) and decision creativity and propitiousness (i.e. reaching…
Abstract
Purpose
The purpose of this paper is to examine the association between positive perceptions of politics (i.e. positive politics) and decision creativity and propitiousness (i.e. reaching unforeseen advantages while limiting unexpected problems). In addition, drawing from threat-rigidity effect theory the authors argue that such relationships will be resilient to external environmental threats and specifically macro-economic uncertainty.
Design/methodology/approach
The database for the analyses consisted of 200 strategic decisions gathered from firms located in Dubai.
Findings
Positive politics significantly influence decision creativity and propitiousness. Also, macro-economic uncertainty moderates this relationship.
Research limitations/implications
Although this research has tried to adopt a more neutral perspective on political behavior, much more work is required to better understand the role and implications of neutral politics in decision-making.
Practical implications
If decision makers ensure that the concern for the organization’s welfare remains a priority over the self-serving motives of the actors, then politics can enhance decision success.
Social implications
This paper challenges the long held conventional wisdom that politics in organizations are an important underlying cause of unethical practices, poor decisions and organizational ineffectiveness.
Originality/value
The findings serve to further the understanding of complexities involved in the relationships between political behavior and its consequences.
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Today, global supply chains must deal with large amounts of uncertainty. This paper seeks to provide a framework for understanding the different types of uncertainties that can…
Abstract
Purpose
Today, global supply chains must deal with large amounts of uncertainty. This paper seeks to provide a framework for understanding the different types of uncertainties that can impact supply chains and their attendant information systems.
Design/methodology/approach
Addresses the following questions. What are the different types of uncertainty at the general macro level? How are these macro level uncertainty types broken down into more specific types of uncertainty seen in supply chains? What impact do these uncertainties have on the supply chain and the supporting IS, and what are the current methods for dealing with them?
Findings
The term uncertainty is used as a generic reference for various and sundry different types of problems within the management of supply chains and their supporting information systems (IS). This can lead to confusion about what tools and techniques are available and which tools apply to which types of problems. The framework presented allows researchers and practitioners to more accurately converse about the exact problems encountered in the management of supply chains and the tools that are needed to address these problems.
Originality/value
The paper addresses uncertainty in supply chains and provides a starting‐point for further discussion and research on the management of uncertainty within them.
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Erhan Mugaloglu, Ali Yavuz Polat, Hasan Tekin and Edanur Kılıç
This study aims to measure economic uncertainty in Turkey by a novel economic uncertainty index (EUI) employing principal component analysis (PCA). We assess the impact of…
Abstract
Purpose
This study aims to measure economic uncertainty in Turkey by a novel economic uncertainty index (EUI) employing principal component analysis (PCA). We assess the impact of Covid-19 pandemic in Turkey with our constructed uncertainty index.
Design/methodology/approach
In order to obtain the EUI, this study employs a dimension reduction method of PCA using 14 macroeconomic indicators that spans from January 2011 to July 2020. The first principal component is picked as a proxy for the economic uncertainty in Turkey which explains 52% of total variation in entire sample. In the second part of our analysis, with our constructed EUI we conduct a structural vector autoregressions (SVAR) analysis simulating the Covid-19-induced uncertainty shock to the real economy.
Findings
Our EUI sensitively detects important economic/political events in Turkey as well as Covid-19-induced uncertainty rising to extremely high levels during the outbreak. Our SVAR results imply a significant decline in economic activity and in the sub-indices as well. Namely, industrial production drops immediately by 8.2% and cumulative loss over 8 months will be 15% on average. The losses in the capital and intermediate goods are estimated to be 18 and 25% respectively. Forecast error variance decomposition results imply that uncertainty shocks preserve its explanatory power in the long run, and intermediate goods production is more vulnerable to uncertainty shocks than overall industrial production and capital goods production.
Practical implications
The results indicate that monetary and fiscal policy should aim to decrease uncertainty during Covid-19. Moreover, since investment expenditures are affected severely during the outbreak, policymakers should impose investment subsidies.
Originality/value
This is the first study constructing a novel EUI which sensitively captures the critical economic/political events in Turkey. Moreover, we assess the impact of Covid-19-driven uncertainty on Turkish Economy with a SVAR model.
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The paper aims to investigate whether firms invest in corporate social responsibility (CSR) as a risk protection mechanism as the response to increased geopolitical risk (GPR).
Abstract
Purpose
The paper aims to investigate whether firms invest in corporate social responsibility (CSR) as a risk protection mechanism as the response to increased geopolitical risk (GPR).
Design/methodology/approach
The sample of this study includes non-financial listed firms on the Chinese stock market over 2000–2016. Several measures of CSR and GPR were used to examine the relationship between two factors. Further investigation is conducted to find out how increasing uncertainty in the business environment in both geopolitics and macroeconomic policy affects corporate decision-making regarding CSR.
Findings
GPR has a significant and positive effect on CSR, meaning that Chinese firms use CSR investment as an insurance mechanism against uncertainty arising from heightened geopolitical uncertainty. Further analysis indicates a negative joint effect of GPR and uncertainty in macroeconomic policy on CSR and shows that it can exhaust firms’ resources and offset their individual positive impacts on CSR at the extreme level of uncertainty. The findings are robust to the choices of proxies, model specifications and endogeneity concerns.
Originality/value
This study sheds light on the existing literature by providing empirical evidence on the positive relationship between GPR and CSR. The findings of this study support the risk management view, in which firms engage more in CSR as a form of insurance mechanism to react to geopolitical uncertainty. This is also the first empirical study investigating the joint effect of GPR and economic policy uncertainty on CSR.
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Chao He, Yanxi Li and Runxiang Xu
The purpose of this study is to provide a textual approach to quantify the perception of uncertainty from management side and investigate how firms manage their overseas…
Abstract
Purpose
The purpose of this study is to provide a textual approach to quantify the perception of uncertainty from management side and investigate how firms manage their overseas investment dynamics when perceiving an increase in economic policy uncertainty (EPU).
Design/methodology/approach
Using a textual analysis approach, the study evaluates firm-level perception of EPU. Based on the data from China's listed firms between 2007 and 2018, it examines the association between firm-level perception of EPU and overseas investment using probit model and fixed effects regression with robust standard error adjusted for heteroscedasticity and clustered by firm.
Findings
The study finds that the level of EPU perceived by individual firms is heterogeneous. Moreover, it finds that firm-level perception of EPU is positively associated with firms' overseas investment. When perceiving an increase in EPU, firms are more likely to invest abroad and their overseas investment is more diverse. Further analysis shows that the positive association between firm-level perception of EPU and overseas investment is weaker in firms with higher financing cost, investment irreversibility and management incentive but stronger in firms with more intensive industry competition. However, it does not find significant difference in the impact of firm-level perception of EPU on overseas investment of state-owned enterprises (SOEs) and non-state-owned enterprises (non-SOEs). The results are robust to using alternative measures of primary variables and to endogeneity concerns.
Research limitations/implications
First, although the data on outward foreign direct investment (OFDI) at the national and provincial levels are comprehensive, the data on OFDI at the firm level are still relatively scarce. As the firm-level OFDI data become available, future study could be extended to OFDI flow. Second, future study could use other information disclosed by firms to evaluate their perception of EPU from host countries and examine the impact of bilateral EPU on overseas investment. Third, by evaluating firm-level perception of uncertainty in terms of a particular type of economic policies, such as fiscal policy, monetary policy, trade policy and foreign investment policy, future study could probe the sources of EPU affecting firms' overseas investment.
Practical implications
First, although uncertainty increases the volatility of firms' investment activities, firms can recognize and seize investment opportunities in an uncertain economic environment and make profits through resource integration. Second, as the association between firm-level perception of EPU and overseas investment depends on firm and industry characteristics, firms with higher financing cost, investment irreversibility and management incentive should be more cautious when making overseas investment decisions during uncertainty times. Third, governments should increase the transparency and the stability of their economic policies to help firms plan their investment policies.
Originality/value
The study extends the literature related to EPU measurement by constructing a firm-level perception index of EPU based on firms' annual reports using a textual analysis approach. Moreover, it sheds some light on the mechanism of how firms modulate their overseas investment activities under uncertainty.
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Atreya Chakraborty, Christopher F. Baum and Boyan Liu
The purpose of this paper is to provide evidence on how firm-specific and macroeconomic uncertainty affects shareholders’ valuation of a firm’s cash holdings. This extends…
Abstract
Purpose
The purpose of this paper is to provide evidence on how firm-specific and macroeconomic uncertainty affects shareholders’ valuation of a firm’s cash holdings. This extends previous work on this issue by highlighting the importance of the source of uncertainty. The findings indicate that increases in firm-specific risk generally increase the value of cash while increases in macroeconomic risk generally decrease the value of cash. These findings are robust to alternative definitions of the unexpected change in cash. The authors extend the analysis to financially constrained and unconstrained firms.
Design/methodology/approach
The authors test the hypothesis that the marginal effect of cash holdings on excess stock returns is sensitive to uncertainty. To compute this marginal effect, the authors adopt and extend the approach of Faulkender and Wang (2006) to the authors’ more elaborate model.
Findings
The findings indicate that different sources of uncertainty affect the value of cash holdings differently. Findings indicate that increases in firm-specific risk generally increase the value of cash while increases in macroeconomic risk generally decrease the value of cash. These findings are robust to alternative definitions of the unexpected change in cash. The authors also extend the findings to financially constrained and unconstrained firms.
Originality/value
The findings indicate that the source of uncertainty firm-specific vs macroeconomic risk matters. The two sources of risk may have quite different effects on shareholders’ valuation of a firm’s cash holdings. Results from alternative sources of findings are new. These new findings are robust to alternative definitions of the unexpected change in cash.
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The purpose of this paper is to present an empirical evidence of the impacts of supply chain uncertainty and risk on the logistics performance in the Australian courier industry…
Abstract
Purpose
The purpose of this paper is to present an empirical evidence of the impacts of supply chain uncertainty and risk on the logistics performance in the Australian courier industry. This study examines the impacts of supply chain and risk on the logistics performance in the Australian courier industry.
Design/methodology/approach
This study provides an in-depth analysis of supply chain uncertainty and risk’s impacts on the logistics performance. The structure equation modelling approach is applied to examine the relationship between supply chain uncertainty and risk and logistics performance. Company-side uncertainty and risk, customer-side uncertainty and risk, and environment uncertainty and risk are used to measure the impacts of supply chain uncertainty and risk on the industry. This paper gives attention to the supply chain uncertainty and risk in the industry.
Findings
The results indicate that supply chain uncertainty and risk have negative impacts on logistics performance. Moreover, the greatest impact of supply chain uncertainty and risk was from outside company in the Australian courier industry.
Research limitations/implications
The study focuses on the Australian courier industry, this may limit the implications of findings in different industries. However, the research models may be examined and validated in the different context.
Practical implications
The results may provide directions in the implementation of strategies to manage supply chain uncertainty and risk and improve logistics performance. The findings may enlighten both academics and practitioners to understand and pay attention to the supply chain uncertainty and risk in the courier industry.
Originality/value
There is an argument whether the impacts of supply chain uncertainty and risk are positive or negative in previous studies. In addition, there are very few studies on courier industry. This study clarifies the impacts of supply chain uncertainty and risk on the logistics performance in the courier industry.
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The study aims to assess and prioritise the enablers of manufacturing flexibility by evaluating the degree of environmental uncertainty and manufacturing flexibility in an…
Abstract
Purpose
The study aims to assess and prioritise the enablers of manufacturing flexibility by evaluating the degree of environmental uncertainty and manufacturing flexibility in an uncertain environment.
Design/methodology/approach
The study proposes a methodological approach based on fuzzy quality function deployment (FQFD), fuzzy analytical hierarchical process (FAHP) and fuzzy technique for order of preference by similarity to ideal solution (FTOPSIS) to assess and prioritise enablers of manufacturing flexibility in an uncertain environment.
Findings
The study proposes a methodological approach that can facilitate firms to concentrate on preferred enablers and assist them in formulating a strategy to develop manufacturing flexibility. The empirical case study analysis of an Indian auto-air conditioning manufacturing firm was done to illustrate the effectiveness, flexibility and feasibility of the proposed approach.
Research limitations/implications
The proposed approach is limited to manufacturing flexibility. This study does not consider inter-dependencies among environmental uncertainties.
Practical implications
The proposed methodological approach can assist practitioners in the identification and development of the preferred enablers to improve manufacturing flexibility. Thus, practitioners can invest strategically in the right resources to improve manufacturing flexibility.
Originality/value
The study proposes and validates a methodological approach that simultaneously addresses drivers and enablers of manufacturing flexibility; therefore, it aims to fill the gaps of earlier studies that have majorly studied flexibility concept in an isolated way.
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