Xiaolong Li, Lin Tian, Liang Han and Helen (Huifen) Cai
The purpose of this paper is to use samples from Chinese-listed companies to investigate the effects of interest rate deregulation and earnings transparency on company’s capital…
Abstract
Purpose
The purpose of this paper is to use samples from Chinese-listed companies to investigate the effects of interest rate deregulation and earnings transparency on company’s capital structure in China over the period of 2003–2015. In particular, the authors study the link between state-owned enterprises (SOEs), economic growth targets and marketization in China’s unique institutional context.
Design/methodology/approach
Based on the methodology of quantitative analysis, the authors use baseline and cluster analysis for all samples with full set of controls, for robustness tests of alternative proxy of interest rate control by using a cluster analysis at the firm level, regarding endogeneity tests conducted fixed effect model with adding instrument variables (IV), two-period factors regression method via IV and system generalized method of moments for dynamic analysis.
Findings
The results show that earnings transparency increases firm leverage and the additional tests suggest that such an effect takes place via a mechanism by reducing the cost of debt finance. However, information transparency could moderate the effects of interest rate deregulation on corporate capital structure. In addition, it finds that SOEs are less sensitive toward the changes of interest rates in China because lending to SOEs is policy-oriented and lacks of market evaluation of business risk. Government control is conducive to enhancing the transparency of the whole industry; however, market-oriented reform is conducive to enhancing the transparency of the company’s own information.
Research limitations/implications
The paper makes contribution to the relationship between earnings disclosure quality and capital structure in the Chinese unique institutional context, such as taking the progressive interest rate reform, SOES, different economic growth target and different marketization level in each province of China. The authors suggest that investors will pay more attention to the company’s own unique information transparency in the provinces with a high degree of marketization. As a potential direction for future research, the authors will investigate how the earnings transparency has impact on capital structure, and how such impact would depend on the transparency of specific business, the cap of foreign shareholding and the convenience of investment.
Practical implications
This research would be the target of banking market reform in order to bring a fair financing environment for all businesses in China. It implies that current experiment of interest rate liberalization in China is not as efficient as it could be in allocating funds across all businesses. State banks, SOEs and local governments are still the biggest players on both the demand and supply sides of the Chinese credit markets.
Social implications
The social implication of this paper lies in the fact that first, it provides additional evidence on the effect of market-oriented reforms through how the information transparency interacts with the financial decisions making of corporations. Second, it offers policy implication to banking market deregulation in China.
Originality/value
The paper makes contribution to the relationship between earnings disclosure quality and capital structure in the Chinese unique institutional context. This research tests the existing literature, such as Francis et al. (2004) and Zhang and Lu (2007), and suggests that informationally transparent firms have a higher debt ratio and lower effective interest costs on bank loans. In addition, this paper further explores the role played by interest rate deregulation in corporate finance, and in turn market fund allocation. This paper sheds new light on information transparency and explores the relationship between earnings disclosure quality and debt financing behaviors of Chinese publicly listed companies over the period of 2003–2015.
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Ling Liang, Lin Tian, Jiaping Xie, Jianhong Xu and Weisi Zhang
The car-sharing market has entered the mature stage, and consumers' demand shows a diversified increasing trend. This paper considers two modes of operation and two pricing…
Abstract
Purpose
The car-sharing market has entered the mature stage, and consumers' demand shows a diversified increasing trend. This paper considers two modes of operation and two pricing strategies, which are business-to-consumer and consumer-to-consumer modes, market pricing and platform pricing. Under these conditions, the platform's revenue-sharing ratio will be different. The purpose of this paper is to explore this research question, and seeks an optimal pricing mechanism that can achieve a win–win situation between platform and automobile manufacturer in the two market modes.
Design/methodology/approach
The authors design different profit functions for platform under the two contexts. Of course, the platform's function is constrained to the manufacturer's function. By introducing a revenue-sharing contract a Stackelberg game model dominated by the platform is established and the equilibrium solutions under the two pricing models are derived.
Findings
The study found that even if only market pricing is executed, the scale of the car-sharing market will continue to expand. As the car-sharing market becomes more saturated, platform pricing is better for the automobile manufacturer; in most cases, the platform prefers platform pricing, but when the number of private cars is relatively small, if the cost of car operation and maintenance for the automobile manufacturer is lower or the revenue-sharing ratio of private cars is high, then market pricing will be more favorable to the platform.
Practical implications
With the cross-border integration of car service platforms and the automobile manufacturing industry, the key to achieving win–win cooperation and sustainable development in the car-sharing market will converge on the question of how to design a suitable pricing mechanism and revenue-sharing method.
Originality/value
Authors have determined how a car-sharing platform achieves a win–win order pricing strategy with the manufacturer and private car owners, respectively. And authors combined the supply chain revenue-sharing contract with the car-sharing market to explore the application of the revenue-sharing contract in the sharing economy.
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Muhammad Nabeel Safdar, Tian Lin and Saba Amin
This study, a symposium, aims to explore the determinants of financial inclusion, impact of cross-country income-variations on financial inclusion, do high-income countries really…
Abstract
Purpose
This study, a symposium, aims to explore the determinants of financial inclusion, impact of cross-country income-variations on financial inclusion, do high-income countries really uplift the financial inclusion and does the higher financial inclusion index indicate the larger economy?
Design/methodology/approach
This study adopts the panel data model to investigate the impact of high-income countries and low- and middle-income countries on financial inclusion. However, this study further adopts the principal component analysis rather than Sarma’s approach to calculate the financial inclusion index.
Findings
Based on the Data of World Bank, United Nations, International Monetary Fund, World Development Indicators, this study concludes that there is no nexus between income variations and financial inclusion, as the study reveals that some low- and middle-income countries have greater financial inclusion index such as Thailand (2.8538FII), Brazil (1.9526FII) and Turkey (0.8582FII). In low- and middle-income countries, the gross domestic product per capita, information technology and communication, the rule of law, age dependency ratio and urbanization have a noteworthy impact on financial inclusion that accumulatively describe the 83% of the model. Whereas, in high-income countries, merely, information technology and urbanization have a substantial influence on the growth of financial revolution and financial inclusion that describes the 70% of the total.
Research limitations/implications
The biggest limitation is the availability of data from different countries.
Originality/value
The originality of this paper is its technique, which is used in this paper to calculate the financial inclusion index. Furthermore, this study contributes to 40 different countries based on income, which could help to boost financial inclusion, and ultimately, it leads them toward economic growth.
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Racha Harakati, Ines Ghazouani and Zaineb Hlioui
In this study, we aim to define a new ecological financial pecking order. We examine how SMEs' adherence to the environment in the Mediterranean region is impacted by their…
Abstract
Purpose
In this study, we aim to define a new ecological financial pecking order. We examine how SMEs' adherence to the environment in the Mediterranean region is impacted by their financial resources and how women Entrepreneurship could play a moderating role in this relationship.
Design/methodology/approach
Our data are pooled cross-sectional firm level data across 14 Mediterranean countries, with a total of 5,949 observations over the period from 2018 to 2020. We look into the moderating influence of SMEs’ female ownership on the financial sources-environmental engagement link using GLS estimations. To reach our aim we focus on seven funding sources and develop a green engagement construct using JCA. Besides, we distinguish between the least and most environmentally engaged companies in the EU and its neighborhood and compare the different interactions and possible moderations.
Findings
Results show that government subsidies foster environmental engagement, followed by supplier credits with a less significant positive impact. The bank credits have the least significant beneficial influence, while non-bank financial institutions have a non-significant effect. We underline that environmental engagements are hindered by the other funds, issued bonds and internal funds.
Research limitations/implications
SMEs in the Mediterranean region, particularly the less environmentally conscious, require strong legal frameworks to enforce environmental responsibility and raise awareness. Integrating less environmentally committed EU SMEs into state subsidy strategies is a chance to improve environmental responsibility in the region.
Originality/value
To our knowledge, there are no prior studies that present a detailed financial structure and environmental management investigation for SMEs within the Mediterranean region while considering the moderating effect of women's entrepreneurship.
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This paper attempts to discover whether or not social networks work in the same way in different sectors of the labour market in the same society, using data from the 2008 Asian…
Abstract
Purpose
This paper attempts to discover whether or not social networks work in the same way in different sectors of the labour market in the same society, using data from the 2008 Asian Social Survey. Labour markets in some societies are segmented; there are two segments in the labour market, namely, the core sector and the peripheral sector. The practices of each sector differs from the others. Some sectors employ CME labour markets, while others favour LME labour markets (Kanbayashi and Takenoshita, 2014). In other words, we can find both CME and LME labour market in one society.
Design/methodology/approach
Since Granovetter’s (1973) pioneer study, scholars are interested in investigating in what way social network influence our job searching outcomes. However, these researchers have not yet yielded consistent results. Scholars argue that the institutional context of labour market can shape the network impacts on our job search outcome (Chen, 2014; Chua, 2011).
Findings
Surprisingly, this paper finds that there is no room for the use of personal contact in the public sector in both China and Japan. But, mean status is positively related to annual income in the private companies sector in both Japan and China. The significant influences of mean status in the private sectors in both China and Japan reflect the reinforcing of existing social inequality structure. This is because as the status of contact can facilitate respondents' job attainment process, those who are already in higher social status are more likely than those who are in the bottom of the social strata, to get a better job with the help from their network members.
Originality/value
The above findings show us that social network can exert various impacts on people's job searching process even in the same society. This is because it is possible that the labour market are segmented. These segments have very different practices. This difference attributes to the inconsistent findings of network effects on occupational attainment process. Therefore, it is essential to locate which labour market respondents are in, and the features of this labour market. This can help us know more about the use and effectiveness of network in different types of labour markets.
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Chun‐Fei Hsu, Chia‐Yu Hsu, Chih‐Min Lin and Tsu‐Tian Lee
A chaotic system is a nonlinear deterministic system that displays complex, noisy‐like and unpredictable behavior. The interest in chaotic systems lies mostly upon their complex…
Abstract
Purpose
A chaotic system is a nonlinear deterministic system that displays complex, noisy‐like and unpredictable behavior. The interest in chaotic systems lies mostly upon their complex, unpredictable behavior, and extreme sensitivity to initial conditions as well as parameter variations. Based on wavelet neural network's (WNN) online approximation ability, the purpose of this paper is to propose an adaptive Gaussian wavelet neural control (AGWNC) system to control a chaotic system.
Design/methodology/approach
The proposed AGWNC system is composed of a wavelet neural controller and a compensation tangent controller. The wavelet neural controller utilizes a Gaussian WNN to mimic an ideal controller, and the compensation tangent controller is designed to compensate the approximation error between the ideal and the wavelet neural controllers. The controller parameters of the proposed AGWNC can online tune in the Lyapunov sense, thus the uniformly ultimately bounded stability of closed‐loop system can be guaranteed.
Findings
The proposed AGWNC system is applied to a chaotic system. Simulation results are used to demonstrate the effectiveness and performance of the proposed AGWNC scheme. Simulation results show that not only the favorable control performance can be achieved but also the control efforts without any chattering phenomena. Moreover, all controller parameters can be online tuning by the derived adaptive laws based on the Lyapunov function.
Originality/value
The proposed AGWNC approach is interesting for the design of an intelligent control scheme. The main contributions of this paper are: the overall closed‐loop control system is globally stable in uniform ultimate boundedness; the tracking error can be asymptotically attenuated to a desired small level around zero by appropriate chosen parameters and learning rates; and the AGWNC system can achieve favorable tracking performance.
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R.M.D.A.P. Rajapakse, S.M.Ferdous Azam and Ali Khatibi
The utilisation of market-based approaches (MBAs) than command-control approaches (CCAs) is still at the embryonic stage to stimulate the green behaviour of small and medium-sized…
Abstract
Purpose
The utilisation of market-based approaches (MBAs) than command-control approaches (CCAs) is still at the embryonic stage to stimulate the green behaviour of small and medium-sized enterprises (SMEs) in developing economies. The study aims to elucidate the association between environmental incentives (EIs), green responsiveness (GR) and environmental performance (EP).
Design/methodology/approach
A quantitative dominant research design is adopted with qualitative support. The study model is developed by integrating legitimacy theory (LT) and the natural resource-based view (NRBV). The cross-sectional data were gathered from the upper echelon of 395 SMEs in Sri Lanka, and 10 subsequent interviews were conducted. The partial least squares approach of structural equation modelling (PLS-SEM) was used to evaluate the hypothesised relationships.
Findings
The results found evidence to demonstrate that EIs positively link with GR and EP and GR mediates this association. Further, the study revealed that although MBAs are established, the SME sector is less aware of EIs such as tax concessions, tax reliefs, low interest, soft loans and discounts on eco-materials.
Practical implications
The results provide valuable insights to enhance environmental sustainability. The owners of SMEs should strategically use environmental inducements to overcome resource poverty to engage in green practices. The regulators and policymakers should develop the incentive policies and provide the mechanisms to disseminate the required skills and technologies to SMEs.
Originality/value
According to the authors' best knowledge, this is one of the pioneering empirical studies on EIs, GR and EP with mediating effects in Sri Lanka.
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Leticia Pérez-Calero, Ma del Mar Villegas and Carmen Barroso
The purpose of this paper is to examine in greater depth the concept of “board capital”, which the authors consider to be a bundle of three types of capital, and believe to be a…
Abstract
Purpose
The purpose of this paper is to examine in greater depth the concept of “board capital”, which the authors consider to be a bundle of three types of capital, and believe to be a clear antecedent of the board’s ability to perform its roles, which have positive consequences for the firm’s performance.
Design/methodology/approach
Through 83 firms listed on The Madrid Stock Exchange during the period 2005-2010, the authors test empirically the relationships between different dimensions of board capital and firm performance, and specially how internal social capital moderates the relationships between board human capital and external social capital with firm performance.
Findings
The results show that certain characteristics of human capital (average board tenure) and external social capital (directors’ interlocks) are positively related to the firm performance. The empirical findings also indicate that the internal social capital, measured by board density, is positively related to the firm performance and moderates these above relationships, increasing the potential of the resources contributed by the board members and influencing to a large extent on a firm’s performance.
Practical implications
The results of the investigation will help both executives and scholar in two ways. First, they will assist firms when they have to select board members, as they can now understand how the resources that board members bring with them can affect the firm performance. To be more effective, boards need to have members that have experience as firm’s directors, external connections to other boards and many internal ties among them. Second, in this context, internal social capital is especially relevant, so the firms should look for possible ways of encouraging internal ties between directors. In this paper, the authors have opted for study the participation of directors in committees.
Originality/value
The authors propose that these three types of capital (human, external and internal social capital) need to be synergistically combined to create a group of directors with access to a complete set of skills, knowledge and connections, but which can still work as a compact social group when making decisions.
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Anneke Soraya Hidayat, Gil-Je Lee, Eun-Jun Yoon and Kee-Young Yoo
The detection of an adversary in secret image sharing has been a problematic side in the reconstruction phase. Some of verifiable secret sharing solutions have been proposed to…
Abstract
Purpose
The detection of an adversary in secret image sharing has been a problematic side in the reconstruction phase. Some of verifiable secret sharing solutions have been proposed to solve the problem. However, there is some computational limitation in the previous schemes. The purpose of this paper is to analyze the importance of consistency for detecting an adversary in a secure reconstruction phase. Strong t-consistency assures the correctness of reconstructed secret as long as participants P ∈ N and n(P) = t. Consistency is a solution for preventing the participant to be absent and helps the dealer to easily detect the adversary without an additional verification step.
Design/methodology/approach
This paper focuses on secure reconstruction, and uses two different approaches, namely, single-secret and multi-secret, to experiment the relationship between the given variable (t,m,n) and the adversaries by observing the quality test result, polynomial approach and visualization.
Findings
The results show that t and m are inversely proportional to the image quality without respect to the polynomial approach. The reconstruction phase is declared as securely conducted when m = 2t − 1, for both single- and multi-secret approaches.
Originality/value
The application of consistency is a considerable step for securing the secret from an adversary by combining the reconstruction phase and the consistency combination at once, removing the need for additional separate verification steps for decreasing the computational time, especially in secret image sharing.