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1 – 10 of over 7000Liang Wu, Heng Liu and Yongchuan Bao
This paper aims to explore how manufacturing firms pursue business model innovation (BMI) through their use of outside-in thinking.
Abstract
Purpose
This paper aims to explore how manufacturing firms pursue business model innovation (BMI) through their use of outside-in thinking.
Design/methodology/approach
Survey data were collected on 175 Chinese manufacturing firms. A regression model was used to verify the research results.
Findings
Manufacturing firms rely on outside-in thinking to develop BMI under different market and institutional environments. From a whole-value-chain perspective, interacting with customers and sharing information with suppliers are two key ways to develop BMI.
Research limitations/implications
Firms focus on customer needs, sense the dynamics of external markets and technology and seize market opportunities to measure outside-in thinking. Empirical results suggest using other measures of outside-in thinking. BMI itself can be multidimensional, so scholars could consider BMI’s diverse dimensions and measurements, which may demand different kinds of outside-in thinking.
Practical implications
Manufacturing firms can use outside-in thinking to overcome inertia and rigidity and increase their knowledge, information and technology. Managers should develop outside-in thinking to respond quickly to emerging economies. Managers should use value chain collaboration and improve the firm’s capacity to interact with customers and suppliers to apply the benefits of outside-in thinking to their BMI.
Originality/value
The study explores how outside-in thinking is a key driver of BMI. Applying the whole-value-chain view, it finds that interacting with customers and suppliers connects outside-in thinking with BMI. It also highlights the effects of intense market competition and volatile government regulation on BMI.
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M. Kabir Hassan, Aishath Muneeza and Ismail Mohamed
This paper aims to derive a compatible Shariah opinion on the permissibility of using cryptocurrencies by Muslims by reviewing the opinions expressed by Shariah scholars on the…
Abstract
Purpose
This paper aims to derive a compatible Shariah opinion on the permissibility of using cryptocurrencies by Muslims by reviewing the opinions expressed by Shariah scholars on the permissibility of cryptocurrencies.
Design/methodology/approach
This is a qualitative desk review research where the opinions expressed by the Shariah scholars on the permissibility of cryptocurrencies and the issues related to it have been analyzed using the literature. All the Shariah parameters checked pertaining to currencies have been studied and assessed to derive the Shariah opinion.
Findings
The research findings suggest that cryptocurrencies do not fully meet the characteristics of money according to Shariah principles. Scholars debate their classification as a medium of exchange due to concerns about volatility, intrinsic value and governance. The treatment of cryptocurrencies varies, and their decentralized nature prevents monopolization. Governance and resistance to manipulation are facilitated by blockchain technology. Classifying cryptocurrencies as hard money and their recognition as the primary unit of account face challenges. While they can be a store of value, price volatility and regulations must be considered. The network effect is crucial for their success, and their supply is controlled through complex protocols. These findings have implications for policymakers in Islamic finance.
Originality/value
The differences in Shariah opinions on using cryptocurrencies have been a major debate in the Islamic financial industry. A clear and comprehensive study is not found on the differences in the Shariah opinions on their reasonings, which is important for researchers and professionals in the field. Therefore, this research provides valuable insights for policymakers, scholars and practitioners in Islamic finance, contributing to the understanding of applying Islamic principles to cryptocurrencies.
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Athanasios Koulakiotis, Dimitrios Angelidis, Konstantinos Tolikas and Phil Molyneux
This paper develops the approach suggested by Howe et al. to examine the impact of cross‐listings on stock price volatility in Europe.
Abstract
Purpose
This paper develops the approach suggested by Howe et al. to examine the impact of cross‐listings on stock price volatility in Europe.
Design/methodology/approach
A modified generalized autoregressive conditional hetero‐skedasticity (GARCH) modeling approach as suggested by Li and Engle is used taking into account different regulatory structures across the range of markets using LaPorta et al.'s stock market regulatory classification.
Findings
It is found that information spillover effects are important for the Dutch market for cross‐listed equities and that a different regulatory environment may have a noteworthy impact on symmetric information spillovers.
Research limitations/implications
The focus is 11 cross‐listing equities and on an event window of 12 years. This implies that the results may be biased on the data sample and the length of the period that used.
Practical implications
The findings are important for the shareholders of cross‐listed companies as the various impacts of regulatory differences between markets (as a result of low and high shareholder protection rules) from foreign markets to the Dutch home market are identified.
Originality/value
A primary focus of this paper is to provide a different methodology than the one adopted by Howe et al. using a modified GARCH modeling approach as suggested by Li and Engle, to examine the impact of the cross‐listings of Dutch firms on symmetric volatility spillovers. The analysis also takes into account the influence of different regulatory structures across the range of markets where Dutch firms are cross‐listed. In particular, we use LaPorta et al.'s stock market regulatory classification is used to analyze the magnitude and persistence of symmetric volatility spillovers from the foreign listing to the home equity of cross‐listed companies in the Dutch stock exchange.
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Abstract
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Rahman Ullah Khan, Karim Ullah and Muhammad Atiq
This study aims to synthesize the existing literature with insights gained from interviews conducted with regulatory experts. The objective is to analyse the challenges associated…
Abstract
Purpose
This study aims to synthesize the existing literature with insights gained from interviews conducted with regulatory experts. The objective is to analyse the challenges associated with incorporating cryptocurrencies into regulatory frameworks and to explore constraints in the regulatory institutionalization of cryptocurrencies.
Design/methodology/approach
The study methodology consists of two steps. The first step is to identify regulatory constraints in the literature review and in the next step, interviews are conducted with officials of the State Bank of Pakistan (SBP). The study used a qualitative case study methodology, in which a single case (regulatory constraint) was selected as a unit of analysis.
Findings
The findings show that lack of traceability, legal status, lack of governmental control due to decentralization, difficulty enforcing laws, volatility, lack of skills with regulators and difficulty integrating cryptocurrencies into the current financial system are the main obstacles to the introduction of a regulatory framework. Thus, on a broader conceptual level, the findings can be grouped into opportunism, lack of strategic capability and fragmented global laws.
Research limitations/implications
This study could inform global cryptocurrency regulation discussions, sharing a developing country’s views on balancing the government, central banks, the financial sector and public interests. This could guide countries to consider cryptocurrency adoption in similar situations. This could affect the cryptocurrency market, impacting demand, supply and investor trust in Pakistan.
Practical implications
The study has implications for policy making officials. The research aims to offer valuable insights to the SBP and other regulatory authorities, helping them identify potential risks and create an effective regulatory framework for cryptocurrencies.
Social implications
The study has implications for society in knowing about the volatile nature of cryptos and anonymity of their issuers, which poses regulatory constraints. This then implies its harmfullness to its traders and the huge losses that may arise from their trading due to its volatile nature.
Originality/value
This study contributes to the literature on the constraints, responsibilities and consultation framework of cryptocurrency regulations.
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This study investigates the impact of simultaneously replacing both midday single-price call auction and lunch break with multi-price continuous trading on intraday volatility…
Abstract
Purpose
This study investigates the impact of simultaneously replacing both midday single-price call auction and lunch break with multi-price continuous trading on intraday volatility–volume patterns as well as the intraday volatility–volume nexus.
Design/methodology/approach
The analysis utilises 150 m tick-by-tick transaction data related to 333 stocks traded on Borsa Istanbul Equity Market covering a period of 2 months prior to and following the change. In addition to graphic comparisons, the study uses difference in mean tests, panel-fixed generalized least squares (GLS), panel-random GLS and random-effects linear models with AR(1) disturbance regression estimations.
Findings
The results show that intraday volatility and trading volume form an inverse J-shape and are positively correlated. It is observed that the implementation of the regulation change decreased intraday volatility and increased trading volume. Additionally, the results indicate a negative volatility–liquidity and a positive volume–liquidity relationship, supporting the mixture of distribution hypothesis.
Research limitations/implications
Enhanced market efficiency provides greater opportunity for investment and risk management. Investors can benefit from the findings on the intraday volatility–volume nexus, which is an indicator of informed trading, and regulatory authorities can use volume to oversight volatility.
Originality/value
This very rare regulation change of the simultaneous replacement of the lunch break and midday call auction with continuous trading is investigated in the context of intraday volume and volatility. This study also expands upon some important findings on the volume–volatility nexus for the Turkish Stock Market.
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Eva Marie Ebach, Michael Hertel, Andreas Lindermeir and Timm Tränkler
The purpose of this paper is to determine a financial institution's optimal hedging degree under consideration of costly earnings volatility induced by fair value accounted…
Abstract
Purpose
The purpose of this paper is to determine a financial institution's optimal hedging degree under consideration of costly earnings volatility induced by fair value accounted derivatives. The discussion on the adoption of fair value accounting in the financial industry has been rather controversial in recent years. Under this accounting regime, the change in market values of specific assets must be considered as profit or loss. Critics argue that fair value accounting induces higher earnings volatility compared to historical cost accounting and, therefore, may initiate a downward spiral during recessions. Thus, increased earnings volatility induces costs, which can be explained by disappointed capital market expectations. Consequently, in general, a lowering of earnings volatility will be rewarded. Consistent with this theoretical finding, empirical research provides strong evidence that companies pursue income smoothing to reduce earnings volatility. In contrast to industrial corporations, financial institutions may easily reduce their earnings volatility by engaging in additional hedging activities. However, more intense hedging usually reduces expected profits.
Design/methodology/approach
Based on a research project initiated by a large German bank, this study quantitatively models the trade-off between the (utility of) costs of earnings volatility and the reduction of profit potential through additional hedging.
Findings
By conducting sensitivity analyses and simulations of the crucial factors of the trade-off, we examine relevant causal relationships to obtain first indications about the economic benefits of income smoothing.
Originality/value
To the best of our knowledge, we are the first to develop an optimization model that supports decision-making by attempting to determine an optimal (additional) hedging degree considering the costs induced by earnings volatility.
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Bashar S. Al‐Yaseen and Husam Aldeen Al‐Khadash
This paper seeks to examine the risk relevance of fair value income measures under IAS 39 and IAS 40.
Abstract
Purpose
This paper seeks to examine the risk relevance of fair value income measures under IAS 39 and IAS 40.
Design/methodology/approach
The study sample comprises Jordanian insurance companies. Data were collected from two main sources: Jordanian insurance companies' annual reports, and the official website of the Amman Stock Exchange. The study begins by investigating the volatility of four income measures, calculated by including and excluding holding gains or losses of financial instruments and property investments. Then it examines the association between its four income volatility measures and one stock market‐based risk factor, in order to provide evidence on the risk‐related information content of each income volatility measure.
Findings
Income based on fair values reflects income volatility more than historical cost‐based income. It is also found that income is (not) more volatile with the recognition of unrealized fair value gains/losses on financial instruments (investment property). Results of assessing the relative explanatory power of income volatility measures suggest that not all fair value income volatility measures can be a good proxy of the total risk. On the contrary, none of our income volatility measures provides significant incremental risk‐relevant information for total risk.
Originality/value
Most prior studies have focused on the value relevance of fair value accounting in Western developed countries, and mainly in the banking sector. This study makes a significant contribution to existing knowledge via exploring the applications of fair value accounting by insurance companies and investigating the implications of mark‐to‐market on risk, instead of share price, in an emerging country – Jordan. The findings of this study are useful to researchers and capital‐market participants interested in explaining accounting and market risk measures.
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This paper aims to investigate price responses and volatility spillovers between commodity spot and futures markets. The study ultimately seeks the evidence-based claims on the…
Abstract
Purpose
This paper aims to investigate price responses and volatility spillovers between commodity spot and futures markets. The study ultimately seeks the evidence-based claims on the efficiency of the long run and short run horizontal price transmissions from futures markets to spot markets.
Design/methodology/approach
This study used the most recent daily price series of pepper, cardamom and rubber, during the period 2004–2019, use “cointegration-ECM-GARCH framework” and verify the persisting validity of the “expectancy theory” of commodity futures pricing.
Findings
The results offer overwhelming evidence of futures market dominance in the price discoveries and volatility spillovers in spot markets. However, this paper finds asymmetric responses between cash and futures prices across markets. The hedging efficiency of futures contracts is commodities specific’ where spices futures are more efficient than the rubber futures.
Practical implications
The study passes on vital information to the producers and traders of spices and rubber who have a potential interest in the use of futures contracts to make profits from arbitrage between futures and cash markets.
Originality/value
The paper is unique in terms of understanding asymmetric price linkages in markets for plantation crops.
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The existing literature offers various perspectives on integrating cryptocurrencies into investment portfolios; yet, there is a gap in understanding the behaviours, attitudes and…
Abstract
Purpose
The existing literature offers various perspectives on integrating cryptocurrencies into investment portfolios; yet, there is a gap in understanding the behaviours, attitudes and cross-investment links of individual investors. This study, grounded in the modern portfolio theory and the random walk theory, aims to add empirical insights that are specific to the UK context. It explores four hypotheses related to the influence of socio-demographics, digital adoption, cross-investment behaviours and financial attitudes on cryptocurrency owners.
Design/methodology/approach
This study uses a logistic regression model with secondary data from the Financial Lives Survey 2020 to assess the factors impacting cryptocurrency ownership. A total of 29 variables are used, categorized into four groups aligned with the hypotheses. Additionally, hierarchical clustering analysis was conducted to further explore the cross-investment links.
Findings
The study reveals a significant lack of diversification among UK cryptocurrency investors, a pronounced inclination towards high-risk investments such as peer-to-peer lending and crowdfunding, and parallels with gambling behaviours, including financial dissatisfaction and a propensity for risk-taking. It highlights the influence of demographic traits, risk tolerance, technological literacy and emotional attitudes on cryptocurrency investment decisions.
Originality/value
This study provides valuable insights into cryptocurrency regulation and retail investor protection, underscoring the necessity for tailored financial education and a holistic regulatory approach for investment products with comparable risk levels, with the aim of minimizing regulatory arbitrage. It significantly enhances our understanding of the unique dynamics of cryptocurrency investments within the evolving financial landscape.
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