Business Commons^™

Navigating Geopolitical Crises For Energy Security: Evaluating Optimal Subsidy Policies Via A Markov Switching Dsge Model, Ying Tung Chan, Maria Teresa Punzi, Hong Zhao

Sim Kee Boon Institute for Financial Economics

This paper aims to provide insights on the design of optimal subsidy policies to enhance energy security amidst energy disruptions triggered by geopolitical conflicts. We introduce a novel Markov switching dynamic stochastic general equilibrium (MS-DSGE) model to address the limitations of existing integrated assessment models in environmental evaluation. These models often fail to adequately consider the environmental and economic impacts of geopolitical conflicts and do not prioritize energy security sufficiently in policymaking. Our application of the MS-DSGE model to the Russia–Ukraine conflict reveals significant decreases in output, social welfare, and energy consumption during disruptions. The mere anticipation of an energy …

Local Institutional Investors And Corporate Monitoring: Evidence From Cross-Listed Korean Stocks In The Us Market, Changhwan Choi, Chune Young Chung, Jun Myung Song

Sim Kee Boon Institute for Financial Economics

Using Korean firms that are cross-listed in the US market, this paper investigates whether there are standalone effects of geographic and market proximity of institutional investors on monitoring performance. We find that Korean institutional ownership is negatively associated with earnings management while the US institutional ownership has no impact on earnings management. This suggests that there is the geographic proximity advantage over the market proximity advantage in the emerging markets. Furthermore, we also show that the impact of geographic proximity is stronger for firms with high informational opacity

Key Success Factors Of Strategic Transformation For Sino-French Cooperation In The Development Of Third-Party Markets In Africa, Bin Wang

Dissertations and Theses Collection (Open Access)

The most popular form of third-party market cooperation is an innovative international economic and trade cooperation model initiated by China under the context of the “Belt and Road” initiative nowadays. Although China and France, as non-state actors, have actively promoted trilateral cooperation and improved various agreements, the trilateral countries have not achieved effective resource complementarity due to differences in political and economic systems and goals, resulting in high complexity in the cooperation process.

Therefore, the research topic of this study is dedicated to addressing this pain point and assisting Chinese enterprises in leveraging third-party markets to expand overseas business under …

Strategic Diplomacy: The Singapore Case, Country Report For The Project On ‘Strategic Diplomacy For 21st Century Defence And Statecraft’, Evelyn Goh, Wee-Kiat Lim

CCX Research

How does Singapore conduct strategic diplomacy despite being a small and constrained state? This report first identifies the major long-term drivers affecting Singapore’s security, both at the domestic level (rapidly ageing population, immigrant assimilation, and growing societal fault-lines) and at the international or systemic level (changing global order, power of technology, slow collective action on climate change). Then it analyses how Singapore strategists deal with two of their most prominent problem-sets: (i) positioning Singapore in relation to the US-China rivalry and the changing international order; and (ii) tackling climate change as a collective action problem. Both problem-sets illustrate how Singapore …

Steering The Intangible Wheel: Chief Executive Officer Effect On Corporate Cultural Change, Xina Li, Guoli Chen, Rui Shen

Research Collection Lee Kong Chian School Of Business

We provide large-scale empirical evidence of how much chief executive officers (CEOs) change corporate culture. To do this, we use employee reviews to measure corporate cultural change in S&P 1500 firms. In a variance decomposition analysis, we find a modest effect of CEOs on corporate cultural change. The effect of CEOs on cultural change is larger than industry effect but smaller than firm effect. Regression analysis in the context of CEO succession further shows consistent evidence of a modest effect of CEO succession on corporate cultural change. In addition, the relationship between CEOs and cultural change is not likely to …

Ai Fairness In Action: A Human-Computer Perspective On Ai Fairness In Organizations And Society, David De Cremer, Jack Mcguire, Jack Mcguire

Research Collection Lee Kong Chian School Of Business

Artificial intelligence (AI) systems are being increasingly adopted by society, governments, and organizations in various decision-making contexts. For example, organizations use AI systems to decide whether applicants can be considered for a job, whether bonuses and other rewards should be allocated, or whether promotions and further training need to be invested in. In fact, as AI is seen as an important catalyst of economic growth, organizations today seem to know no boundaries in their AI adoption efforts, making employees and society more dependent on and thus also more vulnerable to the decisions made by or in partnership with AI (De …

Special Issues In Support Of Evidence-Based Policy Making In Sustainable Banking And Finance, Lucia Alessi, Theodor Florian Cojoianu, Declan French, Andreas G. F. Hoepner

Research Collection College of Integrative Studies

BackgroundIn December 2015, 195 countries around the world signed the Paris Agreement and pledged to work towards limiting global greenhouse gas emissions in order to limit the average global temperature increase to 1.5 °C above preindustrial levels. From a scientific perspective, the stabilisation of global warming under any target requires the achievement of a net-zero emissions economy (Matthews & Caldeira, 2008). In support of global investors looking to provide capital towards green solutions andSustainability disclosures – a means to what end?A significant body of literature has suggested that many of the voluntary sustainability disclosures of companies come from the need …

Investor Reaction To Spacs' Voluntary Disclosures, Vincent Castellani, Karl A. Muller, K.J. Park

Research Collection School Of Accountancy

SPACs are formed to combine with and provide a private firm public trading status and a capital infusion. Firms that enter the public market through a SPAC combination are believed to possess greater voluntary disclosure discretion than traditional IPOs as they obtain their public trading status through a merger. Consistent with regulators’ concerns, recent research finds that SPACs use this discretion opportunistically by issuing optimistic guidance. This study examines how investors respond to these disclosures. We find that optimistic projections increase retail purchasing, which is higher than that of institutional purchasing. Additionally, we find that investors partially see through the …

The Effect Of Mandatory Esg Disclosure On Firms’ Going-Private Decisions, Ying-Chi Huang

Dissertations and Theses Collection (Open Access)

This study examines whether mandatory ESG disclosure encourages publicly traded firms to go private due to an increase in proprietary costs. I find that firms affected by the European Union’s Non-Financial Reporting Directive 2014/95/EU are more likely to go private after the passage of the directive. The results of the cross-sectional tests suggest that the driver of the decision to go private is the increase in proprietary costs. The main results are more pronounced for firms with fewer peers who voluntarily disclose ESG information, those operating in industries with a higher rate of new entrants, those with higher R&D expenditures, …

The Effects Of Leader Member Exchange Differentiation On Task Performance And Organizational Citizenship Behaviors, Junhui Gan

Dissertations and Theses Collection (Open Access)

This study delves into the intricate dynamics of Leader-Member Exchange (LMX) within working teams, with a specific focus on Leader-Member Exchange Differentiation (LMXD) and its subsequent impact on task performance and Organizational Citizenship Behaviors (OCB). Utilizing a comprehensive, multisource dataset comprising 394 employees across 120 store teams in three furnishing shopping malls in Zhejiang Province, China, this research employs a two-wave data collection methodology to examine the proposed theoretical model.

Contrary to prevailing assumptions in the LMX literature, this study reveals that LMXD does not significantly influence anticipated team conflict, nor does it exert indirect effects on task performance and …

Research On The Industrial Chain Network-Driven Innovation Model Of China's Audio-Visual Industry Park, Yang Chen

Dissertations and Theses Collection (Open Access)

This dissertation explores the model through which Chinese audio-visual industry parks drive innovation leveraging industrial chain networks, with Xing Guang Movie and Television Park as the core case study. It also integrates analyses of several other representative Chinese audio-visual industry parks. Based on these case analyses, it identifies critical elements essential for successful innovation within audio-visual industry parks driven by industrial chain networks, thereby providing a realistic foundation for the theoretical framework of the thesis.

Drawing on innovation theory, network theory, industrial chain network theory, and collaborative capability theory, this study abstracts the model driving innovation through industrial chain networks …

Research On The Relationship Between Social Responsibility Fulfillment And Reputation Of Platform Enterprises, Hong Tao

Dissertations and Theses Collection (Open Access)

In the rapidly evolving platform economy, platform enterprises have emerged as significant contributors to socio-economic development, integrating resources and optimizing service delivery through innovative business models. However, their rapid ascension has also spotlighted significant challenges, especially in fulfilling their social responsibilities (SR) and managing their reputations effectively. This doctoral thesis delves into the intricate relationship between the fulfillment of social responsibilities by platform enterprises and their subsequent reputation in the market. Through a comprehensive literature review, this study identifies a gap in understanding how platform enterprises’ approach to social responsibility impacts their reputation among stakeholders. Utilizing a mixed-method research design …

Common Ownership And Analyst Forecasts, Qiang Cheng, Shuqing Luo, Jinping Zhang

Research Collection School Of Accountancy

We examine the effect of the common ownership relation between brokerage houses and the firms covered by their analysts (referred to as co-owned brokerage houses, co-owned firms, and connected analysts, respectively) on analyst forecast performance. Common ownership can help the connected analysts have better access to co-owned firms, leading to higher-quality analyst research. However, common owners have incentives for higher valuation of the co-owned firms and thus can exert pressure on the connected analysts to issue optimistically biased research reports for these firms. We find that common ownership improves analyst forecast accuracy. This result is robust to a difference-in-differences design …

Introducing Business School Research And Positive Impact, Howard Thomas

Research Collection Lee Kong Chian School Of Business

Typically, there are three main priorities, and dimensions, which interact with each other as business schools frame their visions and missions of enhancing management knowledge and producing distinctive management theories and insights. First, the processes of knowledge generation and development to produce high quality, often multi-disciplinary research outputs involving academic faculty, doctoral students and ‘tri-sector’ participants. Second, knowledge dissemination in teaching and learning activities enabling the growth of quality education at undergraduate and postgraduate levels and thus contributing to student intellectual growth and societal socio-economic development and advancement. Third, knowledge transfer through ‘tri-sector’ collaboration, engagement and practice enhancements that is …

Promoting Esg Investing By Trustees: Risk Management And Structuring Solutions, Vincent Ooi, Alvin W. L. See

Research Collection Yong Pung How School Of Law

The world is falling behind on its commitments to tackle some of the most pressing problems of this century: climate change, inequality, and other obstacles to building a sustainable future. In 2015, all Member States of the United Nations adopted the 2030 Agenda for Sustainable Development which set out 17 Sustainable Development Goals (‘UNSDG’) and 169 targets spanning the spectrum of environmental, social and economic dimensions of development. At the mid-point to 2030, the UN Secretary-General reported that of the roughly 140 targets for which data is available, about 12 per cent are on track; more than half are moderately …

Climate Change Concerns And Mortgage Lending, Tinghua Duan, Frank Weikai Li

Research Collection Lee Kong Chian School Of Business

We examine whether beliefs about climate change affect loan officers’ mortgage lending decisions. We show that abnormally high local temperature leads to elevated attention to and belief in climate change in a region. Loan officers approve fewer mortgage applications and originate lower amounts of loans in abnormally warm weather. This effect is stronger among counties heavily exposed to the risk of sea-level rise, during periods of heightened public attention to climate change, and for loans originated by small lenders. Additional tests suggest that the negative relation between temperature and approval rate is not fully explained by changes in local economic …

Shadow Bank, Risk-Taking, And Real Estate Financing: Evidence From The Online Loan Market, Xiaoying Deng, Chong Liu, Eng Seow Ong

Research Collection Lee Kong Chian School Of Business

This paper examines whether and how individual risk-taking behavior affects real estate financing through shadow banks. Using the loan data from an online platform in China, we show that riskier households tend to employ online loans to meet the increasing down-payment in their home purchase. Individual investors are likely to fund riskier real estate loans with higher expected returns. Real estate loans experience higher ex-post default rates than other types of loans. The effect is more pronounced during the period of credit constraints.

Derivatives And Market (Il)Liquidity, Shiyang Huang, Bart Zhou Yueshen, Cheng Zhang

Research Collection Lee Kong Chian School Of Business

We study how derivatives (with nonlinear payoffs) affect the underlying assets liquidity. In a rational expectations equilibrium, informed investors expect low conditional volatility and sell derivatives to the others. These derivative trades affect different investors utility differently, possibly amplifying liquidity risk. As investors delta hedge their derivative positions, price impact in the underlying drops, suggesting improved liquidity, because informed trading is diluted. In contrast, effects on price reversal are ambiguous, depending on investors relative delta hedging sensitivity, i.e., the gamma of the derivatives. The model cautions of potential disconnections between illiquidity measures and liquidity risk premium due to derivatives trading.

Stuck At Home: Does The Virtual Office Stifle Creativity?, Andrew Heng, Roy Y. J. Chua

Research Collection Lee Kong Chian School Of Business

Remote work boosts flexibility but may stifle creativity. In her office one day last summer, Charlotte Christ, a 27-year-old marketing executive with the German office of one of the world’s leading automotive suppliers, did something she doesn’t think she could really do at home even though she often works there. At the office, she fell into a random conversation with a colleague, and together they came up with new ideas for her marketing campaign on how to offer incentives to the company’s target audiences, truck drivers.

Language-Related Misunderstanding At Work: What It Is, Why It Occurs And What Organizations Can Do About It, John Fiset, Devasheesh P. Bhave

Research Collection Lee Kong Chian School Of Business

Language is the foundation of human interaction. It plays a central role in facilitating effective communication by allowing people to express their thoughts, share essential information and establish connections with one another.

The Impact Of The Business School Research, Kai Peters, Howard Thomas

Research Collection Lee Kong Chian School Of Business

Producing high-quality research has long been an important strategic objective for business schools. Faculty research has typically been evaluated by articles appearing in highly regarded academic journals and by citation counts. Increasingly, however, government funding bodies are seeking more than just appearances in 4* journals, they are looking for meaningful societal impact. To this end researchers, in various countries, must submit case studies to funding bodies outlining concrete examples of impact in addition to the original research articles. In the future, the financial reward for high-impact case studies will significantly supersede the reward for journal prestige and citation counts.

The Economic Value Of Blockchain Applications: Early Evidence From Asset-Backed Securities, Xia Chen, Qiang Cheng, Ting Luo

Research Collection School Of Accountancy

In this paper, we evaluate the economic value of a blockchain application. In the context of asset-backed securities (ABS) issuance in China, where some ABS are issued with blockchain technology and others are not, we find that the use of blockchain significantly reduces the coupon yield at issuance. Compared with other ABS, those issued using blockchain technology experience a decrease of 31.4 basis points in the yield spread, which corresponds to a relative decrease of 13%. We further document that the effect of blockchain is more pronounced for ABS deals rated by less reputable credit rating agencies and agencies that …

Heterogeneous Adaptability: Learning, Cash Resources, And The Fine-Grained Adjustment Of Misaligned Governance, Xavier Martin, Ilya Cuypers

Research Collection Lee Kong Chian School Of Business

Research Summary: When can a firm make fine-grained adjustments to misaligned subsidiary governance? We examine whether and under what conditions a firm will adapt the equity stake it owns in a subsidiary, enabling improved alignment of the stake with the uncertainty in the local environment. We predict that the rate of adaptation of misaligned equity stakes depends on the experiential and vicarious learning from which the firm can draw, and that these learning effects are contingent on possessing fungible slack resources, specifically cash. Using a sample of 726 Japanese-foreign subsidiaries established in 38 host countries over a 21-year period, we …

R&D Project Portfolio Collaboration: How To Structure The Strategic Alliance, Guiyun Feng, Pascale Crama, Wenqi Lian

Research Collection Lee Kong Chian School Of Business

Incumbent companies target innovative firms with promising research and development (R&D) projects to rejuvenate their product portfolio. Such strategic alliances create value by combining the innovator’s research expertise with the partner firm’s superior marketing capability. The partner firm chooses the timing and payment terms of the strategic alliance, accounting for the innovator's budget and marketing capability, and the project portfolio's market interaction and revenue variability. The partner firm may prefer delayed alliances post R&D completion for innovator firms with high marketing capability when the innovator has sufficient budget or when market interaction is weak. Upfront alliances - prior to the …

Market For Manipulable Information, Hui Chen, Jian Sun

Research Collection Lee Kong Chian School Of Business

We study how investors, firms, and information sellers interact in a market with manipulable information. To better predict the firm characteristics they care about, investors can buy a score from a monopolistic information seller, which aggregates signals that are subject to firm manipulation. The average degree of signal manipulability has no effect on the equilibrium, while the uncertainty about manipulability becomes a new source of noise. Its contribution depends on firms' incentive to manipulate the signals, which in turn depends on the equilibrium price sensitivity to the score. The optimal design of the score weighs signal precision against the endogenous …

Politics Speak Louder Than Skills: Political Similarity Effects In Hireability Judgments In Multiparty Contexts And The Role Of Political Interest, Franz W. Moenke, Filip Lievens, Ursula Hess, Philipp Schaepers

Research Collection Lee Kong Chian School Of Business

Recruiters increasingly cybervet job applicants by checking their social media profiles. Theory (i.e., the political affiliation model, PAM) and research show that during cybervetting, recruiters are exposed to job-unrelated information such as political affiliation, which might trigger similarity-attraction effects and bias hireability judgments. However, as the PAM was developed in a more polarized two-party political system, it is pivotal to test and refine the PAM in a multiparty context. Therefore, we asked working professionals from the United States (two-party context, N = 266) and Germany (multiparty context, N = 747) to rate an applicant’s hireability after cybervetting a LinkedIn profile …

From Net Zero To Nature Positive, Simon J.D. Schillebeeckx, Ryan Merrill

Research Collection Lee Kong Chian School Of Business

The concept of Net Zero, once considered a significant step towards sustainability, is now seen as outdated and insufficient in addressing climate change and biodiversity loss. To heal our planet, businesses must collectively adopt Regeneration: a holistic, impact-focused, and much more effective Nature Strategy. It's crucial that we recognize other planetary boundaries beyond carbon and transcend a company’s responsibility beyond emissions culpability. By choosing a Nature Pledge over or in addition to a Net-Zero pledge, you will be making a profound commitment to real systemic change and planetary health.

Innovation In Dynamic Knowledge Landscapes: Using Topic Modelling To Map Inventive Activity And Its Implications For Financial Performance, Simon J.D. Schillebeeckx, Yimin Lin, Gerard George

Research Collection Lee Kong Chian School Of Business

We examine the relationship between innovation and performance in the agricultural industry by studying how a firm's patent portfolio position in the knowledge landscape moderates the relationship between three firm search dimensions (scope, specialisation, and commitment) and the firm's financial performance. To represent dynamism in the knowledge landscape, we apply topic modelling to 67,120 patent texts of 571 firms and introduce two complementary perspectives on how knowledge can be dynamically categorised. This allows us to create two representations of the knowledge structure to identify contested (scarce) clusters of high (low) recent inventive activity and emergent clusters where knowledge ambiguity has …

Fairness Perceptions Of Artificial Intelligence: A Review And Path Forward, Devesh Narayanan, Mahak Nagpal, Jack Mcguire, Shane Schweitzer, David De Cremer

Research Collection Lee Kong Chian School Of Business

A key insight from research on organizational justice is that fairness is in the eye of the beholder. With increasing discussions–especially among computer scientists and policymakers–about the potential biases and unfairness of decisions made by Artificial Intelligence (AI) systems, there is a critical need to consider how decision-subjects perceive the fairness of AI-led decision-making. Drawing upon theoretical and empirical perspectives on perceived fairness in organizational justice scholarship, this review categorizes and analyzes perceptions of AI fairness as they impact the effective implementation of AI in workplaces and beyond. Specifically, we review existing empirical research on AI fairness according to distinct …

Why The Ethical Use Of Ai Matters For Your Career, Jack Mcguire, David De Cremer, Yorck Hesselbarth, Leander De Schutter

Research Collection Lee Kong Chian School Of Business

In the contemporary digital era, innovations such as artificial intelligence (AI) are profoundly transforming the business landscape (De Cremer, 2020). The buzz surrounding ChatGPT, coupled with recent assertions about the sentience of Google’s LaMDA, a large language model, underscore the prominence of chatbot technology in these advancements (Adamopoulou & Moussiades, 2020; Ryu & Lee, 2018; Tiku, 2022). Customer-oriented chatbots, an emergent application of this tech, offer unparalleled efficiency and cost-effectiveness, operating ceaselessly and responding to client inquiries in real time (Salesforce, Research, 2019). Yet, amidst these advantages lies an ethical conundrum. Customers cherish genuine human interaction and can become quickly …