Business Commons^™

The Impact Of High-Order Risk Attitudes On Bank's Loan Policy, Yuchen Luo

Theses & Dissertations

It is well known that prudence plays an important role in the process of decision making under uncertainties. However, how prudence affects a bank's decision on extending fixed rate or variable rate loan has not yet been fully examined. In this dissertation, I use definition of second-order expectation dependence to further identify conditions for the risk prudent (imprudent) bank under state-dependent framework to refrain from extending fixed rate loans. Furthermore, using a set of actual data, I apply a recent developed inference procedure for testing positive expectation dependence to demonstrate the significance of my work in empirical applications. In the …

The Impact Of Credit Default Swaps On Corporate Investment Policy, Xinshu Xue

Theses & Dissertations

Credit Default Swaps (CDSs) play an important role in the financial markets. The introduction of CDSs has impacts on the bond market, and the financial characteristics and creditworthiness of the underlying reference entities. When financing is not frictionless, the investment policies of firms are related to their financial conditions. However, whether or how the introduction of CDS will directly affect the investment policy of the firm has not been examined empirically in the literature. To shed light on this issue, my study investigates the relation between credit default swaps trading and corporate investment policy for the listed firms in the …

Designing Multi-Target Salesforce Incentive Contract, Wenxin Huang

Theses & Dissertations

Multi-target incentive contracts are widely observed in practice to stimulate salesforce effort. However, little is known about their effectiveness and the issues involved in designing them. In this thesis, we investigate the incentive contracting problem between a manufacturer and an agent when the realized sales of a product are affected by both the agent's selling effort and the type of the agent. The agent's type is uncertain to the manufacturer, whereas the agent can observe the actual type when exerting her selling effort. Again, this is unobservable by the manufacturer. For contract design problem, we develop a principal-agent model with …

Information Leakage And Stackelberg Leadership In Cournot Competition, Huajiang Luo

Theses & Dissertations

In duopoly Cournot competition with sequential moves, it is well known that each player prefers Stackelberg leadership without demand uncertainty. We study the same game when the demand is uncertain, and firms possess some private information about the uncertain demand. There are two effects of private information in this game. First, when the Stackelberg leader moves first, its private information is leaked to, or inferred by the Stackelberg follower via the output quantity. Hence, the Stackelberg follower makes decision based on more accurate information than the leader. Second, the leader incurs a cost to signal its information to the follower, …

Management Earnings Forecast Decisions In A Regulated Regime : Evidence From China, Jingyu Yang

Theses & Dissertations

Since 2000, China has required publicly listed firms to issue management earnings forecasts when they expect extreme changes in earnings or are likely to become loss-making. This study examines managers’ forecast decisions under this unique regulatory environment. I find an increase over time in the proportion of firms issuing voluntary earnings forecasts when they do not expect extreme changes in their earnings or losses. I also find an improvement in the quality—in terms of the precision, accuracy and bias—of both mandatory and voluntary forecasts over time. Further detailed analysis shows that the introduction of the regulation on management earnings forecasts …

Joint Lead Time And Price Quotation : Dynamic Or Static?, Guo Zhang

Theses & Dissertations

Intuitively, quoting dynamic lead time and price to customers based on real-time system state provides more efficient capacity utilization and increases revenue compared with quoting static lead time and price. However, dynamic quotation may require higher operational costs for the firm and it is often inconvenient to customers. This study aims to compare dynamic and static lead time and price quotations under fixed capacity and different potential demand rates. We hypothesize that there exists a potential demand rate under which the additional costs of dynamic quotation and the additional profit from dynamic quotation are equal. Thus static quotation may yield …

Engaging Your Customers Via Responding To Online Product Reviews, Chunyu Li

Theses & Dissertations

Given the tremendous impact of online reviews on consumer choice, responding to online word of mouth (WOM) has become an important channel for firms to engage the consumers. This thesis investigates how firms can proactively respond to online product reviews to engage customers and manage customer relationships. In Study One, based upon the data of hotel reviews on Tripadvisor.com, I propose that responding by firms differ in three aspects, namely frequency, speed, and the amount of information, and these metrics exert significant influence on subsequent consumes’ WOM engagement, hotel rankings, and votes of usefulness of the reviews.

Moreover, in contrast …

Information Asymmetry, Agency Cost And Stock Liquidity : Evidence From The Split Share Structure Reform In China, Tao Yuan

Theses & Dissertations

The coexistence of tradable and non-tradable shares in Chinese firms has caused severe agency problems and has been the subject of much criticism. In 2005, the Chinese Securities Regulatory Commission launched a reform to eliminate the dual-class share structure and convert non-tradable shares into tradable shares. My thesis examines how the Split Share Structure Reform in China affects the level of information asymmetry of listed firms. The regression results show that the firm-level information asymmetry, measured by the probability of informed trading (PIN), is positively associated to the firm’s proportion of non-tradable shares before the reform, and the PIN decreases …

Overcoming "Liability Of Newness" Of International New Ventures : The Role Of Flexibility, Yuqing Chen

Theses & Dissertations

Riding on the trend of globalization, a large number of new ventures have emerged deploying resources in multiple country markets so as to arrive at a competitive advantage. Studies that focus on such international new ventures grew to become a distinct research area: "international Entrepreneurship" that attracts much research attention but leaves a core issue namely "liability of newness" unaddressed. About 50 years ago, Stinchcombe (1965) coined this term to explain that most new ventures fail because their founders cannot switch their roles quickly enough to adapt to the changing environment. Although previous empirical studies have examined the entrepreneurial firms …

Two Essays On The Mitigating Factors Of Corporate Tax Noncompliance, Kim Wan, Rebecca Luo

Theses & Dissertations

Corporate tax noncompliance is a serious problem in many developed and developing countries. My PhD thesis is composed of two essays to investigate various factors that mitigate corporate tax noncompliance by listed Chinese firms.

The first essay examines whether a firm’s corporate tax noncompliance can be constrained by auditor quality. Past studies have shown that high-quality auditors are effective in reducing earnings management, which mainly involves overstatements of earnings. In this essay, I find that high-quality auditors are associated with better overall tax compliance by their client firms. In particular, high-quality auditors are effective in constraining book-tax-conforming noncompliance, which mainly …

Effects Of Goal Interdependence On Help-Seeking Through Knowledge Sharing And Knowledge Hiding : The Moderating Roles Of Reciprocity Beliefs, Yuen Lam, Fanny Bavik

Theses & Dissertations

The effects of goal interdependence on employees’ performance outcomes have been well documented in the literature. Yet, the relationship between goal interdependence and employees’ proactive behaviors remains largely unexplored. Integrating the theory of cooperation and competition with the employee proactivity literature, this study investigates how cooperative goal interdependence and competitive goal interdependence respectively influence employee knowledge sharing and knowledge hiding, and in turn shape their propensity to seek help from coworkers. It further examines reciprocity beliefs as an individual factor in affecting the indirect effect of goal interdependence on help seeking. Specifically, positive reciprocity belief is hypothesized to moderate the …

Financial Fraud Detection By Using Grammar-Based Multiobjective Genetic Programming With Ensemble Learning, Haibing Li

Theses & Dissertations

Financial fraud is a criminal act, which violates the law, rules or policy to gain unauthorized financial benefit. As an increasingly serious problem, it has attracted a lot of concerns. The major consequences are loss of billions of dollars each year, investor confidence and corporate reputation. Therefore, a study area called Financial Fraud Detection (FFD) is obligatory, in order to prevent the destructive results caused by financial fraud. In general, traditional modeling approaches are applied and based on pre-defined hypothesis testing of causes and effects for FFD problems. In addition, the evaluation criteria are often based on variable significance level …