Search results
1 – 10 of over 8000Lirong Wang, Yingjie Lan and Deming Zhou
Fairness concerns in the supply chain management have recently caught much attention in the OM research community. The combined effect of fairness and competition on supply chain…
Abstract
Purpose
Fairness concerns in the supply chain management have recently caught much attention in the OM research community. The combined effect of fairness and competition on supply chain coordination and the interplay between them, however, have yet to be thoroughly examined.
Design/methodology/approach
The authors study a multiplayer supply chain with one supplier and two competing retailers with fairness concerns by a three-player Stackelberg game model. This theoretical study provides equilibrium solutions under different ranges of fairness and competition combinations. Besides theoretical analysis, the authors also conduct standard economic experiments and estimate structural parameters using experimental data.
Findings
The authors find that a simple wholesale price can coordinate the whole supply chain with certain conditions of fairness and competition. Moreover, although fairness concerns always decrease the wholesale price and increase retailers' profit share, downstream competition weakens such effects and decreases downstream players' market share. The experiments confirm the existence of fairness concerns and the interaction of competition and fairness, as shown in the theoretical analysis.
Research limitations/implications
A more comprehensive model with both distributional and peer-induced fairness considered could generate better insights in the interactive impact of competition and fairness. Moreover, the authors followed the previous channel competition literature and modeled the demand with linear demand function which makes the game decisions trackable in closed form solution. A more general demand function could result in different solutions and thus new insights.
Originality/value
The authors’ work provides a comprehensive theoretical study of the interaction between fairness concerns and competition and clarifies the in-depth connection between the effects of competition and fairness concerns in the literature.
Details
Keywords
Abstract
Purpose
The paper aims to clarify the effects of brand differentiation on the platform's formulation of channel strategy and help the online platform formulate the optimal channel strategy, which involves selecting a proper selling mode for each brand.
Design/methodology/approach
The paper develops a multistage game model consisting of one online platform and two competing manufacturers with differentiated brands and examines the effects of brand differentiation on these three channel members' profits under each candidate channel strategy.
Findings
The results show that the platform prefers to offer the reselling mode for both brands when the brand differentiation is low, and this preference will be enhanced by the decrease in order fulfilment cost. By contrast, when the brand differentiation is high, it will offer the reselling mode for the premium brand but the marketplace service for the economy brand if the order fulfilment cost is not high; or the marketplace mode will be offered to both brands if this cost is high.
Research limitations/implications
This study assumes that the order fulfilment costs of platform and manufacturer are fixed and symmetric. Therefore, researchers are encouraged to consider asymmetric costs of order fulfilment.
Practical implications
The paper guides the online platform to formulate the optimal channel strategy for differentiated brands and provides managerial insights for differentiated brands entering online markets.
Originality/value
This paper explores platforms' optimal channel strategy by jointly considering the effects of brand differentiation and investigates the impacts of brand differentiation on the optimal decision making under four candidate options. Moreover, this paper has been extended to examine the case when the manufacturers' production costs cannot be neglected.
Details
Keywords
Francesco Busato, Maria Ferrara and Monica Varlese
This paper analyzes real and welfare effects of a permanent change in inflation rate, focusing on macroprudential policy’ role and its interaction with monetary policy.
Abstract
Purpose
This paper analyzes real and welfare effects of a permanent change in inflation rate, focusing on macroprudential policy’ role and its interaction with monetary policy.
Design/methodology/approach
While investigating disinflation costs, the authors simulate a medium-scale dynamic general equilibrium model with borrowing constraints, credit frictions and macroprudential authority.
Findings
Providing discussions on different policy scenarios in a context where still it is expected high inflation, there are three key contributions. First, when macroprudential authority actively operates to improve financial stability, losses caused by disinflation are limited. Second, a Taylor rule directly responding to financial variables might entail a trade-off between price and financial stability objectives, by increasing disinflation costs. Third, disinflation is welfare improving for savers, while costly for borrowers and banks. Indeed, while savers benefit from policies reducing price stickiness distortion, borrowers are worried about credit frictions, coming from collateral constraint.
Practical implications
The paper suggests threefold policy implications: the macroprudential authority should actively intervene during a disinflation process to minimize costs and financial instability deriving from it; policymakers should implement a disinflationary policy stabilizing also output; the central bank and the macroprudential regulator should pursue financial and price stability goals, separately.
Originality/value
This paper is the first attempt to study effects of a permanent inflation target reduction in focusing on the macroprudential policy’ role.
Details
Keywords
Siru Lu, Chongyu Wang, Siu Kei Wong and Shuai Shi
This paper aims to examine the housing market responses to two outbreaks of respiratory diseases in Hong Kong during the Information Era – the 2003 SARS and COVID-19 outbreaks.
Abstract
Purpose
This paper aims to examine the housing market responses to two outbreaks of respiratory diseases in Hong Kong during the Information Era – the 2003 SARS and COVID-19 outbreaks.
Design/methodology/approach
The authors first investigate the aggregate housing price changes during SARS and COVID-19. Next, the authors conduct a battery of univariate analyses pertaining to the relationship between district-level housing price movements and geographic and demographic patterns during the pandemic periods. Finally, to shed light on the housing price dynamics at the micro level, the authors conduct an estate-level analysis with the data of 234 residential estates from 2003 to 2020, focusing on the impacts of SARS and COVID-19 on the idiosyncratic volatility of residential estates.
Findings
Overall, SARS and COVID-19 outbreaks are negatively associated with housing prices. However, unlike SARS, the impact of COVID-19 on housing prices was moderate and transient. The geographic imbalances of the epidemic-induced underperformance are observed at the district and estate levels. Finally, the estate-level analysis presented in this paper indicates that the average idiosyncratic volatility of residential estates is 1.5% higher during the SARS period but 3.7% lower during the COVID-19 period. Lower volatility during COVID-19 is likely explained by household learning from the SARS period.
Practical implications
Regulators and investors could resort to efficient information disclosure to attenuate idiosyncratic volatility's adverse impact on housing market returns.
Originality/value
To the best of the authors’ knowledge, the authors are among the first to examine housing market responses to the 2003 SARS and COVID-19 outbreaks using the Hong Kong housing market as a laboratory.
Details
Keywords
In this chapter, we aim to analyze the housing market development in Czechia, in particular the development of housing prices over the last 25 years. We quantify and discuss three…
Abstract
In this chapter, we aim to analyze the housing market development in Czechia, in particular the development of housing prices over the last 25 years. We quantify and discuss three distinct periods of excessive growth of regional Czech housing prices, identified through the formation of large positive GAPs – (1) before the entrance of Czechia to the European Union (EU), (2) at the onset of the Global Financial Crisis GFC, (3) in 2021. In all these periods, we identify significant differences among regions. We find that GAPs above 15% may be considered an indication of unsustainable long-term housing price growth that will be followed by a correction.
We then employ fixed effect panel data model to determine the drivers of flat and house prices in 14 Czech regions. Our results show that wage growth, migration and crime rate are significant factors affecting the prices of both flats and houses. Nevertheless, the impact of GDP per capita and job market indicators differs between flats and houses. Moreover, we find that higher migration into the region increases the difference between the prices of houses and flats, while increasing GDP per capita growth and crime rate mitigate this difference significantly.
Details
Keywords
Despite being a flexible tool that can address several macroeconomic issues, Dynamic Stochastic General Equilibrium (DSGE) models have been rarely used to analyse the interaction…
Abstract
Purpose
Despite being a flexible tool that can address several macroeconomic issues, Dynamic Stochastic General Equilibrium (DSGE) models have been rarely used to analyse the interaction between monetary and fiscal policy until the post-financial crisis, leaving a gap in the analysis of how government consumption affects the transmission mechanism of monetary policy. This motivates this paper to analyse how government consumption affects the dynamics of a small open economy, once the former is included in a non-separable form to the utility function. To the best of the authors' knowledge, this issue has not been addressed by the literature, and the authors aim to do so in this paper.
Design/methodology/approach
A standard New Keynesian model for a small open economy is used to allow for the presence of non-separable government consumption in the utility function. The model is supported by panel regressions.
Findings
The inclusion of Government consumption dampens the transmission mechanism of monetary policy. The degree of openness dampens the crowding out effect of fiscal policy to monetary policy, as the exchange rate channel empowers it. Empirical estimates for 35 OECD countries support the theoretical findings of the model.
Originality/value
The effect of government consumption on the transmission mechanism of MP has not been addressed in the literature. This paper contributes to the literature by addressing this issue.
Highlights:
• The inclusion of Government consumption dampens the transmission mechanism of monetary policy.
• The degree of openness alleviates the crowding out effect of fiscal policy to monetary policy, as the exchange rate channel empowers it.
• Empirical estimates for 35 OECD countries support the theoretical findings of the model.
• The inclusion of Government consumption dampens the transmission mechanism of monetary policy.
• The degree of openness alleviates the crowding out effect of fiscal policy to monetary policy, as the exchange rate channel empowers it.
• Empirical estimates for 35 OECD countries support the theoretical findings of the model.
Details
Keywords
As a financial policy, dividend policy significantly affects firm value. This chapter analyzes how stock prices react to dividend decisions. First, a dividend payment is an…
Abstract
As a financial policy, dividend policy significantly affects firm value. This chapter analyzes how stock prices react to dividend decisions. First, a dividend payment is an extraction of value; therefore, stock price theoretically drops by the dividend amount on the ex-dividend day. In practice, the price drop and the dividend magnitude are not equal because of tax clientele, short-term trading, and market microstructure. Investors are indifferent in trading stocks before and after stocks go ex-dividend if they obtain equal marginal benefits from the two trading times. The difference in tax rates on dividends and capital gains leads to the gap between the price drop and the dividend amount. Moreover, if transaction costs are considerable, investors have high incentives to short-sell stocks until they cannot obtain more profits. The final outcome of this short-term trading is the difference between the price drop and the dividend amount. Furthermore, market microstructure factors such as limit orders, bid-ask spread, and price discreteness also create this gap. Second, dividend announcements convey valuable information to outsiders. When firms announce increases (decreases) in dividends, their stock prices tend to increase (decrease). Third, dividend policy is negatively related to stock price volatility. This negative relationship is explained by duration effect, rate of return effect, arbitrage realization effect, and information effect. Empirical evidence for this relationship is found in many countries. Finally, dividend smoothing is also considered as a signal about firms' future earnings. Consequently, firms with stable dividends have higher market value. In other words, dividend stability has a positive effect on stock prices.
Details
Keywords
Fredrick Chege, Hassan F. Gholipour and Sharon Yam
Given the coincidental and sustained rise in house prices and foreign capital flows in Kenya, this study aims to understand whether a long-run relationship exists between real…
Abstract
Purpose
Given the coincidental and sustained rise in house prices and foreign capital flows in Kenya, this study aims to understand whether a long-run relationship exists between real diaspora remittances and real house prices.
Design/methodology/approach
This study uses data from 2004-Q1 to 2020-Q4 and applies an autoregressive distributed lag model for estimation.
Findings
The results indicate that a positive and significant relationship exists between real remittances and real house prices in Kenya in the long run.
Originality/value
To the best of the authors’ knowledge, there is no study exploring the relationship between real remittance inflows and house prices in Kenya, after controlling for other key macroeconomic determinants of house prices. This study addresses this research gap.
Details
Keywords
Zhenfeng Liu, Yujie Wang and Jian Feng
This paper aims to study vehicle-type strategies for the manufacturer's car sharing by accounting for consumers' behavior and the subsidy.
Abstract
Purpose
This paper aims to study vehicle-type strategies for the manufacturer's car sharing by accounting for consumers' behavior and the subsidy.
Design/methodology/approach
The authors develop a game model, in which a monopoly manufacturer that can produce gasoline vehicles (GVs) or energy vehicles (EVs) not only sells vehicles in the sales market, but also rents them out in the sharing market by the self-built platform. The manufacturer strategically chooses which type of vehicles based on consumers' behavior and whether the government provides the EVs’ subsidy.
Findings
When consumers' low-carbon awareness is relatively high or the marginal cost is low, the manufacturer chooses EVs. The manufacturer chooses GVs when the low-carbon awareness and the marginal cost are low. Only when the low-carbon awareness and the subsidy are not too low, the manufacturer who originally chose GVs launches EVs. When the low-carbon awareness is high, the excessive subsidy discourages the manufacturer from entering the sharing market. If the government provides the subsidy, the manufacturer launches high-end EVs. Otherwise, the manufacturer launches low-end EVs. Moreover, the subsidy increases consumer surplus and social welfare since the high subsidy makes EVs’ sharing market demand be negative.
Originality/value
This study enriches the literature on vehicle-type strategies for the manufacturer's car sharing, owns a practical significance to guide the manufacturer's operation management in the car sharing market and provides advice on whether the government should provide EVs’ subsidy.
Details
Keywords
Yuxuan Chang and Xiaoyang Zhao
This paper examines whether technological changes that promote communications between investors and managers help bridge the gap in the cost of equity capital among firms in…
Abstract
Purpose
This paper examines whether technological changes that promote communications between investors and managers help bridge the gap in the cost of equity capital among firms in different regions.
Design/methodology/approach
We use the online interaction platforms of listed firms in China and utilize brokerage presence (BP) to capture the geographic distribution of financial factors. We explore whether online interactions would reduce the cost of equity to a greater extent for firms located in low brokerage presence regions (hereafter “low-BP firms”) than those in high brokerage presence regions (hereafter “high-BP firms”).
Findings
We find low-BP firms benefit more from an improved information environment created by online interactions. We also find that posts about low-BP firms are more value-relevant and useful in processing corporate disclosures. Further, a higher number of interactions significantly enhances more informational efficiency for low-BP firms, and the effect of reducing the gap in financing costs is more pronounced when corporate information is complex.
Originality/value
We conclude that online interactions alleviate geography-induced information frictions and create a relatively level playing field for firms located in all regions.
Details