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Article
Publication date: 19 July 2011

Steve C. Lim and Taewoo Park

This paper aims to identify what drives the temporal reduction in the value relevance of earnings documented in the literature. Is it the increasing noise in stock returns…

Abstract

Purpose

This paper aims to identify what drives the temporal reduction in the value relevance of earnings documented in the literature. Is it the increasing noise in stock returns over time, noise in earnings, or both?

Design/methodology/approach

The authors develop hypotheses from the lead/lag structure between stock returns and accounting earnings and perform empirical tests using data from annual COMPUSTAT and monthly CRSP over the sample period of 39 years (1970‐2008).

Findings

The test results show that increasing noise in stock returns over time is primarily responsible for the temporal reduction of R2 in regressions of returns on earnings. Additional analysis shows weak evidence that both the noise in returns and the noise in earnings are responsible for the declining association between earnings and returns in a sub‐period (1970‐1982).

Research limitations/implications

The R2‐based methodology has limitations because, as Gu points out, regression R2s might be incomparable across samples. The findings suggest that future research should control for the effects of the temporal increase in market noise before making value relevance inferences from the declining association between earnings and returns.

Originality/value

The paper contributes to the limited body of research on noise in stock returns as the main driver for the temporal reduction in value relevance of earnings.

Details

Management Research Review, vol. 34 no. 8
Type: Research Article
ISSN: 2040-8269

Keywords

Article
Publication date: 10 December 2018

Byung Il Park and Taewoo Roh

The purpose of this paper is to complement the conventional international business (IB) theory, the OLI perspective, which is good at explaining the foreign direct…

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Abstract

Purpose

The purpose of this paper is to complement the conventional international business (IB) theory, the OLI perspective, which is good at explaining the foreign direct investments (FDIs) undertaken by developed market multinational corporations (DMNCs). This study also suggests a new theoretical framework, namely, the OILL paradigm, that is able to encompass FDIs from emerging market multinational corporations (EMNCs) toward developed economies.

Design/methodology/approach

The data comprising 206 Chinese MNCs, which completed international mergers and acquisitions (IMAs), were obtained from Zephyr. By using these data, logical regressions are conducted to statistically confirm that we should not omit the learning motivation if we want to adequately understand the FDI phenomenon by encompassing investment flow from developing (or emerging) to developed countries.

Findings

The results based on this data set indicate that EMNCs often try to enter developed economies with the motivation to seek sophisticated foreign host knowledge that is not available internally. In particular, they tend to use IMA strategies when they want to learn from heterogeneity (i.e. inter-industry mergers and acquisitions) and absorb advanced technologies from DMNCs.

Research limitations/implications

By shedding light on the recent new trend in FDI (i.e. FDI from emerging countries to developed economies), the study provides useful theoretical implications, as well as suggesting scholarly contributions. However, we should acknowledge that there are some limitations to this study. First, the study explores only Chinese MNCs. Second, learning motivations need to be minutely and precisely measured by other studies. Third, this study argues that FDI from EMNCs to DMNCs is triggered by the former’s motivation concerning knowledge acquisition. However, the type of knowledge should be considered, and this is perhaps another avenue for future research.

Practical implications

Conventional IB theories, such as the OLI paradigm and internalization theory, have long sought to answer the question of why DMNCs go for foreign markets, in spite of the presence of the liabilities of foreignness, and focused on their main investment motivations (i.e. market-seeking, efficiency-seeking and resource-seeking motivations). For this reason, these theories do not adequately capture the primary FDI motivations of EMNCs, and consequently, they are unable to see the big picture when it comes to the FDI phenomenon. Based on this idea, the authors complement the well-known triad motivations (i.e. market-seeking, efficiency-seeking and resource-seeking motivations) by adding the knowledge-seeking motive and contribute to the evolution of IB theories by suggesting a new theory, which is the OILL paradigm.

Originality/value

The study contributes to the extant literature in the field of IB in two key ways. First, it examines EMNCs’ central motivations in conducting FDI where empirical research is sparse. By doing this, this paper attempts to solve the query indicated above (i.e. why MNCs choose FDI in spite of the presence of the liabilities of foreignness), and it offers a new theory (i.e. the OILL paradigm).

Details

International Journal of Emerging Markets, vol. 14 no. 1
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 15 March 2019

Taewoo Nam

The purpose of this paper is to identify individual level perception-based determinants influencing participation in government innovation and to examine the moderating…

Abstract

Purpose

The purpose of this paper is to identify individual level perception-based determinants influencing participation in government innovation and to examine the moderating effect of innovation cynicism upon those determinants.

Design/methodology/approach

Focusing on the case of Government 3.0, a Korean National Government innovation initiative, this study analyzes survey data regarding local public employee perceptions of the initiative through ordered logistic regression.

Findings

Multiple theoretical correlates of perceived desirability, perceived efficacy, performance expectancy, facilitating leadership, peer influence and demonstrable symbols have positive influences on participation in Government 3.0. Surprisingly, cynics of government innovation reported more active participation in Government 3.0 than non-cynics. While cynicism negatively moderates the influence of perceived desirability, performance expectancy and peer influence on Government 3.0 participation, the expected negative moderating effect does not correspond with the influence of perceived efficacy on innovation participation.

Originality/value

The study highlights the importance of innovation cynics, who are probably neither skeptics nor pessimists regarding recent changes but rather are concerned about recurring rhetoric and poor performance of government innovation.

Details

International Journal of Public Sector Management, vol. 32 no. 4
Type: Research Article
ISSN: 0951-3558

Keywords

Book part
Publication date: 5 April 2022

Ayodeji Emmanuel Oke, Seyi Segun Stephen, Clinton Ohis Aigbavboa, Deji Rufus Ogunsemi and Isaac Olaniyi Aje

In defining smart city and its effects on the citizens, the ideas and generalisation of the team members that makes up the smart city team must be thoroughly considered…

Abstract

In defining smart city and its effects on the citizens, the ideas and generalisation of the team members that makes up the smart city team must be thoroughly considered. It is one thing to have the concepts and processes on ground on smart city, it is another to have qualified team members that can deliver such city within a targeted standard. Stakeholders, construction professionals, citizens, concerned individuals among all make up the smart city team members. These members can also be spread across disciplines in order to facilitate effectiveness in every activity designed. Activities such as dissecting characteristics, control and management of smart city are controlled by these team members as they seek for maximisation of output from the resources available.

Details

Smart Cities: A Panacea for Sustainable Development
Type: Book
ISBN: 978-1-80382-455-0

Keywords

Article
Publication date: 20 October 2020

Taewoo Kim and Laura Marler

Possible asymmetric treatment among family members has long been neglected in the field of family firm research. To fill this gap, the purpose of this study is to shed…

Abstract

Purpose

Possible asymmetric treatment among family members has long been neglected in the field of family firm research. To fill this gap, the purpose of this study is to shed light on the heterogeneity of treatment of family members in family firms by proposing factors that influence the likelihood of bifurcation bias among “family” members.

Design/methodology/approach

Drawing upon social identity theory and the concept of bifurcation bias, the authors theorize that family members working in family firms are not a homogenous entity, but rather a heterogeneous entity contingent on their status and/or position in the family. To provide a comprehensive understanding of heterogeneous treatment among family members, both individual factors and societal factors should be considered.

Findings

Blood relatedness of family members is suggested as an important determinant of the likelihood of bifurcation bias among family members. It is also proposed that the impact of blood relatedness is likely influenced by both individual factors (familial proximity and familial tenure) and a societal factor (collectivism).

Originality/value

Theorizing takes a step forward to advance the understanding of interpersonal dynamics in family firms. In particular, this article expands the research boundaries of family business research by taking into account that not all “family” members are treated preferentially. Moreover, this article deepens our understanding of the nature and status of non-blood related family members by unveiling the influence of both individual and societal factors. This article also provides a theoretical foundation for human resource management (HRM) research in family businesses by addressing bifurcation bias among family members.

Details

Journal of Family Business Management, vol. 12 no. 1
Type: Research Article
ISSN: 2043-6238

Keywords

Article
Publication date: 14 November 2008

Marion R. Hutchinson, Majella Percy and Leyal Erkurtoglu

The purpose of this study is to examine the impact of recent corporate governance reforms on the association between governance practices and earnings management.

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Abstract

Purpose

The purpose of this study is to examine the impact of recent corporate governance reforms on the association between governance practices and earnings management.

Design/methodology/approach

This study examines the impact of corporate governance reforms by using a firm fixed‐effect, cross‐sectional analysis of 200 firms listed on the Australian Stock Exchange (ASX) for the financial years ending in 2000 and 2005. This paper examines the association between firms' corporate governance practices and the quality of financial reports as measured by the magnitude of earnings management pre‐ and post‐the governance reforms (CLERP 9 and ASX Corporate Governance Council (CGC)).

Findings

The results of this study indicate that certain governance practices are important in limiting earnings management. In particular, board independence and audit committee (AC) independence, are associated with lower performance‐adjusted discretionary accruals, one commonly used measure of earnings management. However, increasing executive shareholdings provides incentives to manage earnings.

Practical implications

This study is important to investors, academics and policy makers as it demonstrates that governance reforms that encourage firms to adopt better governance practices reduces the likelihood of earnings management.

Originality/value

There is limited research on the association between corporate governance practices or the recent corporate governance reforms (ASX CGC Recommendations and CLERP 9) on earnings management in Australia. This study extends the literature by demonstrating the impact of recent corporate governance reforms on board independence, AC effectiveness and executive directors' shareholding and the association with earnings management.

Details

Accounting Research Journal, vol. 21 no. 3
Type: Research Article
ISSN: 1030-9616

Keywords

Book part
Publication date: 9 May 2022

Tobin Im

Abstract

Details

Transformation of Korean Politics and Administration: A 30 Year Retrospective
Type: Book
ISBN: 978-1-80382-116-0

Article
Publication date: 4 November 2013

Taewoo Roh, Dong-Sung Cho, Hwy-Chang Moon and Yun-Cheol Lee

– The aim of this study is to examine the entry mode that retail firms correctly choose when culture is simultaneously considered has a positive effect on firm performance.

Abstract

Purpose

The aim of this study is to examine the entry mode that retail firms correctly choose when culture is simultaneously considered has a positive effect on firm performance.

Design/methodology/approach

This study relies on the two-step analysis originally derived from Heckman and applied into multinational enterprises (MNEs) entry mode by Shaver. To figure out the probability of entry mode in the first step, the paper uses the logit regression that independent variable is four culture dimensions and dependent variable is the entry mode (joint venture vs wholly owned subsidiary). Since the selection bias is relatively reduced by adding lambda calculated in the first step to the second step that verifies the degree of fit, the safety for interpretation of subsequent models is secured.

Findings

This study collected 96 entries of top global retail firms and found out the relationship between culturally determined entry mode and firm performance is positively significant. While existing literatures dealing with manufacturing firms' international entries showed that wholly owned subsidiary is favored over joint venture when the cultural distance is high, this study focusing on retail firms in the service sector indicates that those firms are more likely to enter the global market with joint venture. Finally, firms that appropriately understand cultural distance demonstrated higher performance in the target country.

Originality/value

This study focuses on the relationship between culturally determined entry mode and firm performance in the service sector, whereas extant literatures heavily depend on the one in the manufacturing sector. Moreover, the two-step analysis is exquisitely adopted to confirm the hypotheses.

Details

Nankai Business Review International, vol. 4 no. 4
Type: Research Article
ISSN: 2040-8749

Keywords

Article
Publication date: 20 August 2021

Werner Fees, Thu Thi Minh Nguyen and Xia Xu-Fees

The purpose of this study is to look at Chinese mergers and acquisitions (M&A) in Germany on a firm level. It focuses on the benefits and risks from the viewpoint of…

Abstract

Purpose

The purpose of this study is to look at Chinese mergers and acquisitions (M&A) in Germany on a firm level. It focuses on the benefits and risks from the viewpoint of Germany. In this way, the authors want to close the research gap concerning the financial consequences of Chinese takeovers for the affected German firms. The purpose is to find out if Chinese investors show a specific behavior in terms of profitability, growth and business risks in the acquired companies.

Design/methodology/approach

This paper studies the financial situation of German firms two years before and two years after being bought by Chinese companies, by analyzing accounting data of 19 target companies in six economic sectors. In this empirical study, firm performance is measured by profitability, research and development cost, liquidity and financial leverage. It is using the industry adjustment method and calculation of mean and weighted mean considering company size.

Findings

Overall, German firms’ financial performance after Chinese M&A did not significantly improve, but they did not worsen either. The changes in financial ratios are different across economic sectors and company sizes. Obviously, the final performance of firms after M&A is quite diverse due to diverse company-specific targets. The results do not reflect common fears about deteriorating situations brought by Chinese involvement drawn in mass media.

Research limitations/implications

The study lacks analysis for a longer period, ideally five years before and five years after M&A. The calculated results of industry mean may differ from the real industry mean, as components are collected from the sample companies accounting for only 70% of the market. Industry means figures are calculated for only one single point in time and assumed to be unchanged over the whole time period. The study covers mostly firms which have total assets of more than €50m, so SMEs are underrepresented.

Practical implications

Owners of German firms that are in target but have not been purchased by Chinese investors can see the trends and anticipate which group of M&A targets their firms are categorized into. If their firms belong to the group of sectors or company sizes that shows negative results of performance after Chinese M&A, they can plan to protect their firms by implementing defending strategies against hostile takeovers. If their firms are in the groups that tend to enhance performance after Chinese M&A, they may be in a good position and able to negotiate for mutually beneficial transactions.

Social implications

The results are important for political and public discussion. It is shown that Chinese acquisitions of German firms do not have a deteriorating effect, at least not in the short-term. Therefore, the results are a good input to neutralize discussions in German society.

Originality/value

The results disagree with the few previous studies on Chinese M&A in Germany (Bollhorn, 2015; Müller, 2017; Löchel and Sächtig, 2019). While the studies of Bollhorn and Müller are based on subjective methods, the study is based on a detailed financial method. Then, in contrast to the study of Löchel and Sächtig, it is strictly focusing on Chinese/German M&A. Most existing empirical studies are focusing on cross-border M&As from developed to developing countries and there is little attention to acquisitions in the other direction (Ma et al., 2016, p. 22).

Details

Review of International Business and Strategy, vol. 32 no. 3
Type: Research Article
ISSN: 2059-6014

Keywords

Article
Publication date: 8 August 2022

Lionel Dongmo Fouellefack, Lelanie Smith and Michael Kruger

A hybrid-electric unmanned aerial vehicle (HE-UAV) model has been developed to address the problem of low endurance of a small electric UAV. Electric-powered UAVs are not…

Abstract

Purpose

A hybrid-electric unmanned aerial vehicle (HE-UAV) model has been developed to address the problem of low endurance of a small electric UAV. Electric-powered UAVs are not capable of achieving a high range and endurance due to the low energy density of its batteries. Alternatively, conventional UAVs (cUAVs) using fuel with an internal combustion engine (ICE) produces more noise and thermal signatures which is undesirable, especially if the air vehicle is required to patrol at low altitudes and remain undetected by ground patrols. This paper aims to investigate the impact of implementing hybrid propulsion technology to improve on the endurance of the UAV (based on a 13.6 kg UAV).

Design/methodology/approach

A HE-UAV model is developed to analyze the fuel consumption of the UAV for given mission profiles which were then compared to a cUAV. Although, this UAV size was used as reference case study, it can potentially be used to analyze the fuel consumption of any fixed wing UAV of similar take-off weight. The model was developed in a Matlab-Simulink environment using Simulink built-in functionalities, including all the subsystem of the hybrid powertrain. That is, the ICE, electric motor, battery, DC-DC converter, fuel system and propeller system as well as the aerodynamic system of the UAV. In addition, a ruled-based supervisory controlled strategy was implemented to characterize the split between the two propulsive components (ICE and electric motor) during the UAV mission. Finally, an electrification scheme was implemented to account for the hybridization of the UAV during certain stages of flight. The electrification scheme was then varied by changing the time duration of the UAV during certain stages of flight.

Findings

Based on simulation, it was observed a HE-UAV could achieve a fuel saving of 33% compared to the cUAV. A validation study showed a predicted improved fuel consumption of 9.5% for the Aerosonde UAV.

Originality/value

The novelty of this work comes with the implementation of a rule-based supervisory controller to characterize the split between the two propulsive components during the UAV mission. Also, the model was created by considering steady flight during cruise, but not during the climb and descend segment of the mission.

Details

Aircraft Engineering and Aerospace Technology, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1748-8842

Keywords

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