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Article
Publication date: 29 April 2019

Haidong Zhao, Sophia T. Anong and Lini Zhang

The purpose of this paper is to investigate the effects of financial incentives on consumers’ intention to adopt near field communication (NFC) mobile payment.

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1478

Abstract

Purpose

The purpose of this paper is to investigate the effects of financial incentives on consumers’ intention to adopt near field communication (NFC) mobile payment.

Design/methodology/approach

An online experiment was conducted crossing two levels of incentive types (cash back and discount), two levels of incentive amounts (5 and 10 percent), and two levels of incentive promotion periods (one and three months). A total of eight treatment conditions plus one control group comprised the 2×2×2 factorial design. A sample of 463 subjects with no prior experience with NFC mobile payment was recruited using a Qualtrics panel.

Findings

This study found that: the availability of financial incentives had a positive effect on intention to adopt NFC mobile payment; financial incentives indirectly affected intention through perceived risk; and while different types, amounts or promotion periods did not seem to matter for those in the low perceived risk group, the main effect of promotion period and the interaction effect between amount and promotion period were significant for those in the high perceived risk group.

Research limitations/implications

The study sample was limited from 18 to 35 age group, which could have affected the varied effect of the different attributes of incentives that were examined.

Originality/value

This study is the first to give some empirical evidence about the impact of financial incentives on NFC mobile payment adoption. The results provide insight to providers as well as retailers offering the incentive payment option.

Details

International Journal of Bank Marketing, vol. 37 no. 5
Type: Research Article
ISSN: 0265-2323

Keywords

Content available
Article
Publication date: 6 November 2017

Noel Murray, Ajay K. Manrai and Lalita Ajay Manrai

This paper aims to present an analysis of the role of financial incentives, moral hazard and conflicts of interests leading up to the 2008 financial crisis.

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3036

Abstract

Purpose

This paper aims to present an analysis of the role of financial incentives, moral hazard and conflicts of interests leading up to the 2008 financial crisis.

Design/methodology/approach

The study’s analysis has identified common structural flaws throughout the securitization food chain. These structural flaws include inappropriate incentives, the absence of punishment, moral hazard and conflicts of interest. This research sees the full impact of these structural flaws when considering their co-occurrence throughout the financial system. The authors address systemic defects in the securitization food chain and examine the inter-relationships among homeowners, mortgage originators, investment banks and investors. The authors also address the role of exogenous factors, including the SEC, AIG, the credit rating agencies, Congress, business academia and the business media.

Findings

The study argues that the lack of criminal prosecutions of key financial executives has been a key factor in creating moral hazard. Eight years after the Great Recession ended in the USA, the financial services industry continues to suffer from a crisis of trust with society.

Practical implications

An overwhelming majority of Americans, 89 per cent, believe that the federal government does a poor job of regulating the financial services industry (Puzzanghera, 2014). A study argues that the current corporate lobbying framework undermines societal expectations of political equality and consent (Alzola, 2013). The authors believe the Singapore model may be a useful starting point to restructure regulatory agencies so that they are more responsive to societal concerns and less responsive to special interests. Finally, the widespread perception is that the financial services sector, in particular, is ethically challenged (Ferguson, 2012); perhaps there would be some benefit from the implementation of ethical climate monitoring in firms that have been subject to deferred prosecution agreements for serious ethical violations (Arnaud, 2010).

Originality/value

The authors believe the paper makes a truly original contribution. They provide new insights via their analysis of the role of financial incentives, moral hazard and conflicts of interests leading up to the 2008 financial crisis.

Details

Journal of Economics, Finance and Administrative Science, vol. 22 no. 43
Type: Research Article
ISSN: 2077-1886

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Article
Publication date: 18 May 2018

Shu-pei Tsai

Enhancing the innovative behaviour of knowledge workers is a main task in knowledge management. The pay-for-performance policy is one of the management practices for…

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1457

Abstract

Purpose

Enhancing the innovative behaviour of knowledge workers is a main task in knowledge management. The pay-for-performance policy is one of the management practices for innovative behaviour enhancement and has been gaining popularity in the knowledge-intensive context. However, it is still uncertain whether such practice really enhances the innovative behaviour of knowledge workers. To address this issue, this paper aims to propose and verify a conceptual framework incorporating kernel notions of social exchange, psychological empowerment and work engagement rooted in the social cognition paradigm.

Design/methodology/approach

The current study conducts a survey on 608 knowledge workers and their supervisors, validating the model structure and causal path pattern of the proposed framework. The causality is delineated from social exchange attributes of financial incentive, psychological empowerment and work engagement to innovative behaviour of knowledge workers.

Findings

Perceived organisational support and perceived pay equity are primary antecedents of symbolic incentive meaning reflected in the financial incentive of the pay-for-performance policy. Symbolic incentive meaning comprising dimensions of relative position, control and personal importance relates positively to innovative behaviour of knowledge workers. Psychological empowerment and work engagement are partial mediators of the positive relationship.

Originality/value

The current study explicates why and how social exchange attributes of the financial incentive provided by the pay-for-performance policy may enhance innovative behaviour of knowledge workers. Implications are supplied to knowledge management scholars and practitioners to optimise the pay-for-performance policy for innovative behaviour enhancement.

Details

Journal of Knowledge Management, vol. 22 no. 8
Type: Research Article
ISSN: 1367-3270

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Article
Publication date: 10 May 2011

Robert J. Dijkstra and Michael G. Faure

The purpose of this paper is to understand the incentive effects of existing compensation mechanisms in case of the bankruptcy of a financial institution.

Abstract

Purpose

The purpose of this paper is to understand the incentive effects of existing compensation mechanisms in case of the bankruptcy of a financial institution.

Design/methodology/approach

The paper uses insights of law and economics to predict the effects of compensation mechanisms on the incentives of depositors, financial institutions, financial regulators and government.

Findings

The paper shows that the current compensation system in The Netherlands will not provide sufficient incentives for all stakeholders to prevent the failure of a financial institution. Adjustments to this system are necessary to improve these incentives.

Original/value

The paper examines for the first time the impact of different compensation mechanisms on the incentives of multiple stakeholders. It also shows how these mechanisms influence each other regarding their incentive generating capability. These findings offer important insights for policy makers.

Details

Journal of Financial Regulation and Compliance, vol. 19 no. 2
Type: Research Article
ISSN: 1358-1988

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Article
Publication date: 9 April 2018

Michael J. Turner and Leonard V. Coote

While investment decisions may be financial decisions, there is a growing recognition that they are also often non-financially based decisions. The purpose of this study…

Abstract

Purpose

While investment decisions may be financial decisions, there is a growing recognition that they are also often non-financially based decisions. The purpose of this study is to report findings focused on the project selection stage of capital budgeting, which has the objectives of exploring for: the relative degree of emphasis decision makers attach to a financial and non-financial orientation in capital budgeting; and the role, if any, that two agency theory variables have on the relative degree of emphasis: a personal incentive for project go-ahead and monitoring of project outcomes through a post-audit.

Design/methodology/approach

Discrete choice experiments (DCEs) are used and framed in a between-subjects 2 (personal incentive) × 2 (monitoring) design. DCEs are well-suited to research questions which examine some tension between competing alternatives. For example, trade-offs involving the relative degree of emphasis decision makers attach to a financial and non-financial orientation in capital budgeting.

Findings

In the absence of a personal incentive and monitoring, decision makers attach a significant degree of emphasis to cash inflows and cash outflows, both financial factors, and one strategic non-financial factor being improvement in the position of the firm vis-à-vis competitors in capital budgeting. However, when decision makers receive a personal incentive from project go-ahead, they attach a lower degree of emphasis to cash outflows. Alternatively, when there is monitoring through a post-audit and a personal incentive, decision makers attach a higher degree of emphasis to cash outflows.

Practical implications

Decision makers attach a significant degree of emphasis to only a relatively narrow band of attributes in making a capital budgeting decision, which is true in both the absence of and in the presence of the agency conditions. There is also little support for the view that there is any higher degree of emphasis attached to a financial orientation vis-à-vis a non-financial orientation. A particularly important finding relates to the overarching goal of monitoring through a post-audit. One view is that it should foster more accurate forecasting by making forecasters aware that their efforts will be reviewed. However, the findings of this study appear to be more supportive of a view that post-audits might lead agents to become more conservative or even shy away from projects.

Originality/value

The study makes contributions to the growing field of research which has the objective of exploring for the relative degree of emphasis decision makers attach to a financial and non-financial orientation in capital budgeting. In particular, it extends the prior research through its investigation of the role that two agency theory variables play in the relative degree of emphasis decision makers attach to a financial and non-financial orientation: a personal incentive for project go-ahead and monitoring of project outcomes through a post-audit.

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Article
Publication date: 17 April 2020

Tomoki Kitamura and Kunio Nakashima

The purpose of this study is to examine the potential and cost of policy incentives for individuals to defer public pension (social security) claims.

Abstract

Purpose

The purpose of this study is to examine the potential and cost of policy incentives for individuals to defer public pension (social security) claims.

Design/methodology/approach

Using Internet survey experiments, the impacts of introducing three potential policies to defer public pension claims are examined: (1) a tax incentive for private term pension premiums, (2) a tax incentive for private term pension benefits and (3) a tax disincentive for financial asset holdings. Effectiveness of information provision regarding projection of future financial assets is also examined.

Findings

Tax incentives have a certain impact on deferment of public pension claims. Among incentives, increase of benefits is the most effective one. Providing information regarding future financial assets reduces incentives.

Originality/value

This study is original in measuring cost for delaying public pension claims according to incentives and information provision.

Details

Review of Behavioral Finance, vol. 13 no. 2
Type: Research Article
ISSN: 1940-5979

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Article
Publication date: 22 March 2019

Karen L. Xie and Yong Chen

Despite the importance of hosts who contribute to the success of accommodation sharing through sharing underutilized space with guests, current literature sheds little…

Abstract

Purpose

Despite the importance of hosts who contribute to the success of accommodation sharing through sharing underutilized space with guests, current literature sheds little light on what exactly incentivizes hosts to grow their properties. The purpose of this study is to investigate the effects of multifaceted motivations including financial benefits, online social interaction and membership seniority and their interplay on hosts’ multiple listing behavior.

Design/methodology/approach

The study is instantiated on real-world business data collected from an accommodation-sharing platform in China. The data set includes 3,199 observations of 252 multi-listing hosts in Beijing who managed 815 properties from September 2012 to October 2016.

Findings

The study discloses that financial benefits, online social interaction and membership seniority significantly incentivize hosts to list multiple properties on the accommodation-sharing platform. In particular, the social incentive is the most important driver among the three. With a 1 per cent increase in online social interactions, the number of properties operated by a host would increase by 13.5 per cent. While the financial benefits and online social interaction motivate hosts to engage in the multi-listing behavior, such effects are significantly mitigated as the membership seniority increases.

Research limitations/implications

This study adds to the extant literature a unique yet less researched perspective of supply expansion driven by hosts. It also provides important practical implications for managing multiple properties for a healthy and viable accommodation-sharing community.

Originality/value

While a majority of the extant research on the sharing economy primarily takes a consumer-related perspective, this study addresses a different and original topic about hosts’ multiple-listing behavior that drives the supply of accommodation sharing. It is a first empirical investigation of the increase of accommodation sharing supply with host motivations explained.

Details

International Journal of Contemporary Hospitality Management, vol. 31 no. 4
Type: Research Article
ISSN: 0959-6119

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Article
Publication date: 1 February 1999

Sue Llewellyn, Ron Eden and Colin Lay

Traditionally in health care and in the public sector more generally, little thought has been given to the impact of provider‐oriented incentives on the delivery of…

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1452

Abstract

Traditionally in health care and in the public sector more generally, little thought has been given to the impact of provider‐oriented incentives on the delivery of services. There has been an assumption that the language of incentives belonged to the private sector and was inappropriate in the public sector. Instead, the governance of health care has relied on the professional ethos of clinicians to direct decision making. Implicitly there has been an expectation that the ethical stance of clinicians would ensure that their actions were always in the best interest of patients. However, in the context of a heightened awareness of cost constraints there has been a greater emphasis on the active management of resources in medical organizations. This article argues that the structure of incentives in health care is highly significant in resource allocation, as medical ethics does not provide an unambiguous guide to clinical decision making. The paper defines the nature of the financial and professional incentives in medical organizations and discusses their impact on the delivery of services through an analysis of positive and negative effects. By undertaking a comparison between the UK and Canada, the paper identifies the differential nature of the incentives present in the health care systems of these two countries and discusses some of their consequences.

Details

International Journal of Public Sector Management, vol. 12 no. 1
Type: Research Article
ISSN: 0951-3558

Keywords

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Book part
Publication date: 9 December 2020

Zhan Furner, Keith Walker and Jon Durrant

Krull (2004) finds that US multinational corporations (MNCs) increase amounts designated as permanently reinvested earnings (PRE) to maximize reported after-tax earnings…

Abstract

Krull (2004) finds that US multinational corporations (MNCs) increase amounts designated as permanently reinvested earnings (PRE) to maximize reported after-tax earnings and meet earnings targets. We extend this research by examining the relationship between executive equity compensation and the opportunistic use of PRE by US MNCs, and the market reaction to earnings management using PRE designations. Firms use equity compensation to incentivize executives to strive for maximum shareholder wealth. One unintended consequence is that executives may engage in earnings management activities to increase their equity compensation. In this study, we examine whether the equity incentives of management are associated with an increased use of PRE. We predict and find strong evidence that the changes in PRE are positively associated with the portion of top managers' compensation that is tied to stock performance. In addition, we find this relationship to be strongest for firms that meet or beat forecasts, but only with the use of PRE to inflate income, suggesting that equity compensation incentivizes managers to opportunistically use PRE, especially to meet analyst forecasts.

Further, we provide evidence that investors react negatively to beating analysts' forecasts with the use of PRE, suggesting that investors find this behavior opportunistic and not fully convincing. This chapter makes an important contribution to what we know about the joint effects of tax policy, generally accepted accounting principles, and incentive compensation on the earnings reporting process.

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Article
Publication date: 1 March 2011

Li-Lin (Sunny) Liu, Kathryn J. Jervis, Mustafa (Mike) Z. Younis and Dana A. Forgione

The purpose of this study is to examine the association of managerial incentives and political costs with hospital financial distress, recovery or closure. The Medicare…

Abstract

The purpose of this study is to examine the association of managerial incentives and political costs with hospital financial distress, recovery or closure. The Medicare Payment Advisory Commission has stated that hospital closures are important for evaluating the distribution of cost, quality and access to healthcare throughout the US. Using Logistic regression, we demonstrate that hospital closure is associated with low occupancy, return on investment, asset turnover, and lack of affiliation with a multihospital system. It is also significantly associated with urban location, teaching programs, high Medicare and Medicaid patient populations, and high debt. Essential access nonprofit hospitals are less likely to close, while this does not affect governmental and for-profit hospitals. Our research hypotheses are supported by these results.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 23 no. 1
Type: Research Article
ISSN: 1096-3367

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