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1 – 10 of 46Ammad Ahmed, Helen Higgs, Chew Ng and Deborah Anne Delaney
This paper aims to investigate the determinants of women representation on Australian corporate boards under the ASX’s “if not, why not” corporate governance framework. It further…
Abstract
Purpose
This paper aims to investigate the determinants of women representation on Australian corporate boards under the ASX’s “if not, why not” corporate governance framework. It further aims to improve the study of Geiger and Marlin (2012) by using a theoretically sound two-limit Tobit model to examine the determinants.
Design/methodology/approach
This study uses the two-limit Tobit model to examine the determinants of women representation on ASX 500 boards. This approach is used due to the censored nature of the dependent variable.
Findings
This study finds that the two-limit Tobit model is an appropriate methodology to accommodate the censored dependent variable. It further finds that firm size, women as chair of boards, corporate governance index, Global Reporting Initiative signatory, debt ratio, average board age, BIG4 auditors, chief executive officer tenure and shareholder concentration are major determinants of women on boards.
Research limitations/implications
The use of only ASX 500 companies and the sample years (2011-2014) may limit the generalisation of the findings.
Originality/value
This is the first extensive longitudinal Australian study to examine the drivers of women representation on corporate boards. It is also the first of its kind to use the two-limit Tobit model to consider these determinants.
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Stanley Kojo Dary and Harvey S. James Jr
The purpose of this paper is to examine the determinants and motives for supply of trade credit among agro-food manufacturing firms in African countries.
Abstract
Purpose
The purpose of this paper is to examine the determinants and motives for supply of trade credit among agro-food manufacturing firms in African countries.
Design/methodology/approach
The paper uses a subsample of food manufacturing firms from World Bank Enterprise Survey in eight African countries in 2014. Two-limit Tobit models are specified for the determinants of trade credit supply (TCS) and the motives for TCS are inferred from the determinants. An instrumental variable two-limit Tobit model is estimated to check the endogeneity of trade credit received (TCR) in relation to trade credit supplied.
Findings
The level of TCS is significantly related with degree of product diversification, manager experience, level of TCR and overdraft availability. From the results, financing motives (particularly liquidity and redistribution) and commercial motives (particularly marketing and quality guarantee motives) for TCS are implied.
Research limitations/implications
The parameter estimates may contain both demand and supply effects as the two effects cannot be separated due to absence of information on firms’ customers in the data set. The results should be interpreted in this context.
Originality/value
The motives for TCS by agro-food firms is less understood in the agricultural finance literature and this paper makes an important contribution in this regard. In particular, the paper shows the degree of product diversification is directly associated with TCS, a relationship which has not been explored in the trade credit literature.
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Many farm producer organizations pursue growth and complexity in response to price volatility, industry consolidation and other external developments. Consequently, as ownership…
Abstract
Purpose
Many farm producer organizations pursue growth and complexity in response to price volatility, industry consolidation and other external developments. Consequently, as ownership is dispersed and control is delegated, members may face increasing agency cost. In spite of the potential to impact performance and even survival, empirical attention to agency problems in farm producer organizations is limited. The purpose of this paper is to address the gap in the literature with an empirical study.
Design/methodology/approach
With survey responses from 365 farm producer organizations in the USA, the author uses a two-limit tobit model to estimate the relationships of six ownership and governance characteristics (i.e. board size, management size, director independence, manager independence, CEO independence and non-member ownership) to agency cost, which is proxied by the operating expense ratio.
Findings
While controlling for heterogeneity in scale and technology, the author finds positive relationships of board size, management size and CEO independence to agency cost. The novel result illustrates there is a significant cost to the adoption of non-traditional ownership and governance characteristics by farm producer organizations.
Practical implications
The presence of agency cost serves as motivation to farm producer organizations to implement new or adapt old agency mechanisms. One recommendation is to reconsider the payment structure of non-member CEOs. There may not be enough incentive to inspire an upstream bias, which is perhaps possible by linking CEO performance to price, patronage and member-oriented performance measurements.
Originality/value
Agency cost is rarely studied in relation to farm producer organizations. Recent contributions in the empirical literature lacked an explicit connection of ownership and governance characteristics to agency cost.
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James R. Bartkus, M. Kabir Hassan and Geoffrey Ngene
The purpose of this study is to investigate the effects of increased fund commitments on portfolio size and subsequent effects on portfolio success rates. This paper empirically…
Abstract
Purpose
The purpose of this study is to investigate the effects of increased fund commitments on portfolio size and subsequent effects on portfolio success rates. This paper empirically analyzes the changes in average portfolio size over a 20‐year time period and how these changes affect the venture capitalists' ability to successfully exit their investments.
Design/methodology/approach
The authors utilize venture capitalists' fund level data and conduct both univariate and multivariate analysis. The multivariate analysis is conducted using a two‐limit regression tobit model. This is justified since the authors' dependent variable is a ratio bounded by zero and one, hence the tobit specification is the most appropriate methodology.
Findings
The authors find that increasing the size of portfolios not only leads to a decrease in the number of successful investments but also significantly affects portfolio success rates. They also find evidence which suggests that some optimal portfolio size exists.
Research limitations/implications
The sample was limited to independent private partnerships that raised funds specifically for investment in US portfolio companies and it represents all funds maintained in the SDC database with non‐missing data on fund size and other fund characteristics.
Practical implications
There are three main practical implications derived from this study. First, venture capitalists overextend themselves by investing in too many portfolio firms. Second, some optimal portfolio size exists beyond which success rate of the venture capitalist's portfolio declines. Third, portfolio size is an important determinant of venture capital portfolio success rates.
Originality/value
The study presents new evidence that venture capitalists have a tendency to increase their portfolio size in years following growth in fund inflows, an idea that has not been investigated earlier. The authors also use data that is not adulterated by significant economic and financial conditions such as internet bubble burst of 2000 and financial crisis of 2007/2008.
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Mercedes Sánchez and José Maria Gil
Conjoint analysis has become an increasingly popular approach to estimate the benefits derived from the attributes of a product. This decompositional method provides information…
Abstract
Conjoint analysis has become an increasingly popular approach to estimate the benefits derived from the attributes of a product. This decompositional method provides information about the structure of consumers' preferences, as obtained from the overall judgement of a set of alternative products defined as a combination of levels of different attributes. A two‐Limit Tobit Model approach for conjoint analysis has been used to examine and compare wine attribute preferences within and between different retail outlets (wine shops, direct‐from‐producer and supermarkets) in two Spanish regions: Aragon and Navarre. Three attributes have been used in the conjoint design: price, origin and vintage year. Among these attributes, price is the principal aspect for consumers who buy in wine shops, origin is the most important attribute for supermarket buyers and grape vintage has more utility for buyers who obtain wine directly from the producer. Finally, three wine consumer segments have been identified and characterised in the two regions.
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Derek C. Jones and Jeffrey Pliskin
To examine the nature and the determinants of the incidence and diffusion of a range of new technologies.
Abstract
Purpose
To examine the nature and the determinants of the incidence and diffusion of a range of new technologies.
Design/methodology/approach
We collected new survey data in 2001 for medium sized establishments in upstate and central New York.
Findings
Our econometric findings suggest that the use of new technologies tends to be more extensive in firms in which greater use is made of flexible work practices and flexible compensation practices and when skill levels are high. We find that the use of IT, the intranet, and computer literacy training is greater when the average tenure of managers is low, which might reflect a greater comfort with new technologies by younger managers. Larger establishments tend to use the Internet more extensively, which may reflect the cost of setting up Internet billing and purchasing systems, and an intranet communication system. Managerial tenure does not affect the use of the Internet in general perhaps because these might be operations that are less central to the activities of more senior managers. Also, we find mixed evidence for our digital divide hypothesis that predicts that the use of new technologies would be greatest in metropolitan areas and least in rural locations.
Research limitations/implications
We recognize it is potentially risky to draw inferences from a relatively small survey.
Originality/value
Some findings mesh with those contained in earlier studies (e.g., Black & Lynch, 2004) though, importantly, now finding emerge when a broader range of new technologies is being considered.
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Christos Konstantinidis, Dimitrios Natos and Konstadinos Mattas
In the midst of the Greek economic and financial crisis, food and beverage firms constitute one of the most dynamic parts of the Greek economy proved resilient in conditions of…
Abstract
Purpose
In the midst of the Greek economic and financial crisis, food and beverage firms constitute one of the most dynamic parts of the Greek economy proved resilient in conditions of economic turbulence. The purpose of this paper is to assess the competitiveness of the Greek food and beverage firms within the context of turbulent economic conditions and draw the relevant entailed agricultural policy viewpoints.
Design/methodology/approach
The analysis is based on competitiveness measures such as profitability and market share utilizing a sample of 550 firms which published their annual balance sheets the 2008–2012 period. The analysis takes place with the use of a simultaneous equations tobit model.
Findings
The main results show that market share, profitability and capital intensity affect positively both on market share and profitability, while operating costs have a negative and statistically significant effect on profitability. The rate of growth affects positively and statistically significant on profitability while the index of loans does not affect on market share. As the results indicate, food and beverages industry has proven resilient in conditions of economic turbulence without direct policy measures or subsidies.
Originality/value
Among other factors, the evolution of agricultural policy is affecting decisively the competitiveness of agro-food sector (Chaddad and Jank, 2006; Banse et al., 1999). Nevertheless, food competitiveness is significantly shaped and influenced within the broad economic climate of a country, region or the whole world. Thus, the present study tries to assess the competitiveness of Greek food and beverages sector in conditions of macroeconomic turbulence and draw the relevant entailed agricultural policy viewpoints.
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Yingqi Wei, Xiaming Liu, Chengang Wang and Jue Wang
Local sourcing from indigenous firms by multinational enterprises (MNEs) is an important channel through which the former may benefit from the positive externalities generated by…
Abstract
Purpose
Local sourcing from indigenous firms by multinational enterprises (MNEs) is an important channel through which the former may benefit from the positive externalities generated by the latter. The purpose of this study is to analyze the extent and determinants of local sourcing of MNEs.
Design/methodology/approach
Employing a survey dataset covering 493 multinational subsidiaries in China during 1999‐2005, this paper applies the two‐limit Tobit model.
Findings
It is found that an MNE's local sourcing decision is influenced by its strategies, characteristics such as size and learning ability and country‐of‐origin. More specifically, export‐orientation strategy, joint venture strategy and networking with local suppliers positively affect local sourcing. Small and autonomous subsidiaries tend to source more locally. Age has a non‐linear effect. The importance of these determinants varies with regions.
Research limitations/implications
Aiming at capacity building and competitiveness of indigenous firms, the Chinese government has initiated local content requirement. This study shows that such policy intervention could be counterproductive. The creation of a more competitive business environment by the government could promote more linkages.
Originality/value
Given its critical role in economic development, local sourcing by MNEs has attracted much attention. Only limited research has been carried out on FDI linkage effects in China, and the location effect on FDI linkages has not been examined. This study aims to fill the gap by using Chinese survey data.
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James R. Bartkus and M. Kabir Hassan
Modern portfolio theory demonstrates that a well‐diversified portfolio will minimize unsystematic risk. It may be impractical to achieve a well‐diversified portfolio of venture…
Abstract
Purpose
Modern portfolio theory demonstrates that a well‐diversified portfolio will minimize unsystematic risk. It may be impractical to achieve a well‐diversified portfolio of venture capital (VC) investments due to market imperfections, leading to the decision to specialize. The purpose of this paper is to determine the implications of choosing a strategy of specialization versus diversification in venture investing.
Design/methodology/approach
Using a dataset of US VC funds across a 20‐year time period, this paper verifies that there has been a tendency for venture capitalists to pursue a specialization strategy in both industry and stage of development of portfolio firms. A multivariate two‐limit tobit model is constructed to determine the effects of these decisions on venture success rates.
Findings
It is found that venture capitalists that diversify across portfolio company stage of development have greater success in bringing companies public and exiting their investments via acquisition. Industry specialization has no significant impact on venture fund success rates.
Research limitations/implications
Success rates may be less important than returns to investors in VC. Future research should examine the effects of specialization on investor returns.
Practical implications
It may be beneficial to increase the level of diversification of VC investments across portfolio company stage of development. The lack of diversification across industry has not significantly affected success rates across funds, thus the tendency to specialize in particular industries over the sample period is not necessarily a poor decision.
Originality/value
Prior research demonstrates a tendency for specialization in VC investing. This paper examines the implications of adopting this strategy.
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Ali Uyar, Nizamettin Bayyurt, Mustafa Dilber and Vehbi Karaca
Comparative shop efficiency within a chain is a key factor in strategic management decisions such as evaluation, promotion and development of shop personnel. Furthermore, overall…
Abstract
Purpose
Comparative shop efficiency within a chain is a key factor in strategic management decisions such as evaluation, promotion and development of shop personnel. Furthermore, overall efficiency of the firm depends on the efficiency of individual shops within the chain. The purpose of this paper is to assess operational efficiency of a bookshop chain in Turkey, and identify efficiency drivers.
Design/methodology/approach
The sample includes 79 bookshops within a bookshop chain. The study uses two‐step procedure. In the first stage, data envelopment analysis (DEA) is utilised to evaluate the comparative efficiency of bookshops. The second stage attempts to determine what drives efficiency by using Tobit regression.
Findings
After assessment of shops’ efficiency by DEA, the results of Tobit regression revealed that shop age has positive significant influence on bookshop efficiency, whereas manager experience, staff experience, and education level of the shop manager do not.
Research limitations/implications
The findings of the paper are based on a single bookshop chain. Thus, one should be cautious while interpreting results.
Originality/value
The contribution of the paper to the literature is of great importance, since no prior Turkish study has dealt with the subject to this extent. Furthermore, although there are studies conducted on various subsectors of retail industry in other countries, there seems to be no study at all conducted on bookshop chains.
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