Ilan Vertinsky

Choice of entry timing and scale by foreign banks in Japan and Korea

Abstract This paper investigates the factors which explain the entry of relatively large banks into foreign markets. A theoretical framework linking entry and degree of commitment to a banks competitive or ownership advantages and the potential benefits and costs of being in a specific foreign market is developed. This framework is used to specify a prognostic entry timing model and models of the form and scale of presence. The implications of the models are then tested using survival time analysis, multinomial logit and regression and data on foreign banks in Japan and Korea.

Strategic trade policy with endogenous choice of quality and asymmetric costs

This paper examines the strategic trade policy incentives for investment policies towards quality improvements in a vertically differentiated exporting industry. Firms first compete in qualities and then export to a third country market based on Bertrand or Cournot competition. Optimal policies are asymmetric across the two producing countries. Under Bertrand competition, the low-quality country subsidizes investment to raise export quality, while the high-quality country imposes a tax so as to reduce the quality of its already high quality exports. Under Cournot competition, the results are reversed with a tax in the low-quality country and a subsidy in the high-quality country.

Private or self-regulation? A comparative study of forest certification choices in Canada, the United States and Germany

Forest certification is perhaps the best example of a voluntary governance structure for addressing environmental spillovers. Competing forest certification schemes have evolved. At the global level, the International Organization for Standardization (ISO) 14001 certification and Forest Stewardship Council (FSC) certification focus on environmental processes and sustainable management of forestland, respectively. Regional/domestic schemes have been started by industry and/or landowners to compete with the FSC system. The main difference between FSC certification and the others is that the FSC relies on regulation by a non-state private regulator, while the others employ a form of self-regulation. In this study, survey data from firms in Canada, the United States and Germany are used to investigate factors that cause firms to prefer and/or choose a particular certification scheme. The findings indicate that market access is an important reason why forest firms certify, but it is an insufficient reason for them to pick the FSC system despite opinion polls that reveal a preference for FSC-style certification. Rather, firms prefer (participate in) FSC certification because they perceive it to confer environmental benefits, while those choosing another certification scheme do so on economic grounds. Finally, as companies become increasingly aware of their certification options, they are less likely to pursue FSC certification.

Mood in foreign exchange trading: Cognitive processes and performance

Abstract This paper examines the effects of mood on the behavior of traders or decision makers in financial markets. Based on a review of the psychological theories and empirical findings which relate mood to decision making and information processing, we derive hypotheses with respect to the impact of good, neutral, and bad moods on the behavior of traders. Two experiments ( N =66 and 72) were conducted on an Internet platform which simulated foreign exchange trading based on historical market data. The first experiment manipulated mood using feedback and music whereas the second one asked subjects to read mood-laden statements. It was found that traders in a good mood had an inferior trading performance (losing money) compared to those in a neutral or bad mood (making profit). This is because traders in a good mood made less accurate decisions than those in neutral or bad moods. Those in a bad mood were the most accurate in their decisions but behaved conservatively in their trading. Subjects in a good mood tended to make less accurate decisions though they spent on average at least the same time as the other subjects on information processing and decision-making. They also were over-confident taking unwarranted risks. The studies concluded with insights concerning the effects of mood on choice of trading strategies.

Organizational Design and Management Norms: A Comparative Study of Managers' Perceptions in the People's Republic of China, Hong Kong, and Canada

This study surveys 155 executivesfrom the Peoples Republic of China (PRC), Hong Kong, and Canada to investigate whether norms for organizational design and management are subject to a process of globalization. The survey consisted of structured questionnaires using two different sets of Likert-like importance rating scales. One set of scales examined organizational design norms. The other setfocused on the desired attributes of a good manager The balance of the evidence from this study supports the hypothesis of globalization. However, the study also indicates that some norms of organizational design that reflect basic cultural values are resistant to change and convergence. Furthermore, the study indicates that regulatory and political differences may be reflected in local adaptation of organizational and management design norms.

Firm Exits as a Determinant of New Entry: Is There Evidence of Local Creative Destruction?

This study posits that a local process of creative destruction provides an impetus to regional industrial renewal. We argue that exits of older firms release resources that stimulate local entry. New entrants add value to these resources by redeploying them in more productive uses. We test our hypotheses with a unique longitudinal database encompassing the entry and exit of Canadian manufacturing enterprises. We find that exits of old firms increase entry and that on average new entrants are more productive. Persistent high local rates of exit, however, deter entry.

Carbon sequestration and land management under uncertainty

Uncertainty about the role of forestry and land-use change in mitigating global warming is addressed using a possibilistic linear programming model of forest and agricultural land management. The objective is to maximize the cumulative net discounted returns in the two sectors, while meeting specific carbon-uptake goals and maintaining stable flows of timber over the planning horizon. Because of ambiguity related to timber yield and carbon parameters, and vagueness of policy targets (economic returns, timber production and carbon-uptake), ordinal measures of uncertainty are applied. While ordinality entails loss of precision, it makes it possible to solve complex problems. This paper compares land-use policies in the boreal forest zone of Northeastern British Columbia under uncertainty with those from a more typical scenario that applies best-guess parameter values. Including uncertainty explicitly into the possibility analysis changes optimal land-use and forest management, and leads to different levels of projected timber supply, economic performance and carbon sequestration. The amount of carbon dioxide (CO2) removed from the atmosphere and the economic cost of carbon uptake are sensitive to how the decision-maker tackles uncertainty.

Advertising Trends in Urban China

ABSTRACT The Chinese advertising market expanded in the past decade at an average annual rate of above 40 percent. The sustainability of such a rapid growth depends in part on the general attitudes of the public toward advertising. This paper reports the results of a telephone survey of 825 consumers in five major cities in China. The survey focused on general beliefs about the institution of advertising, personal experiences, and general attitudes toward advertising. The relationships among beliefs, personal experiences, and general attitudes are modeled. The paper also investigates the relationships among demographic variables and experiences, beliefs, and attitudes. The study shows that urban Chinese have similar or more positive attitudes toward advertising than their U.S. counterparts and that these positive attitudes demonstrate resilience over time. As in the United States, younger consumers have more positive beliefs and attitudes toward advertising. But in contrast to the United States, those with higher levels of education tend to have more positive attitudes and beliefs.

Public–Private Partnerships for the Development of Disaster Resilient Communities

Increasingly, countries around the world are adopting policies that emphasize the importance of partnerships for disaster resilience. The overarching questions that this paper investigates are how to form and sustain (1) effective collaborative arrangements involving governments, businesses, non‐governmental organizations and communities to ensure development of disaster resilient communities, and (2) governance institutions that can effectively mobilize geographically dispersed disaster response resources with fragmented ownership. We have reviewed case studies of alternative inter‐sectoral collaborative arrangements that were formed to (1) promote the development of resilient communities and critical physical and social systems; (2) mitigate or respond to emerging crises; or (3) facilitate post‐disaster recovery and learning. We have developed grounded propositions articulating the antecedents of performance of inter‐sectoral collaborative arrangements.

Product and process certification – Systems, regulations and international marketing strategies

Asymmetries in information, where sellers have more information than buyers about product qualities, may prevent firms from supplying some goods and services despite the fact that consumers are willing to pay adequately for them. The frequency and importance of such market failures is growing with the increase in buyers’ interest in unobservable qualities (attributes) of products, including the nature of their production processes. Certification by credible third parties may reduce the frequency and mitigate consequences of market failures. Certification creates a variety of challenges for both marketers and regulators. In this paper, we examine the emergence of alternative domestic and international regulatory regimes for certifying some qualities of products and services. We explore the implications of these regimes and country and product characteristics to the formulation of international marketing strategies. We illustrate our findings through a case study of the forest products industry.