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Article
Publication date: 26 February 2021

Heng Xu, Xuliang Wu and Yatian Liu

This paper aims to theoretically investigate an online company’s optimal decision on its offline expansion strategy. In the past five years, many large online retailers and…

381

Abstract

Purpose

This paper aims to theoretically investigate an online company’s optimal decision on its offline expansion strategy. In the past five years, many large online retailers and internet-based companies such as Amazon, Google, Alibaba, Tencent and JD.com have expanded their offline market but it was observed that they adopted different expansion strategies. Specifically, some of them expand the offline market by acquiring offline retailers, while some do so by purchasing a portion of offline retailer’s stake. This difference leads to a quite different structure in post-expansion market, having an impact on profit, consumer surplus and social welfare. The goal of this paper is to model such expansion strategies in a general way and complete studies on profits and welfare.

Design/methodology/approach

By constructing a Salop model with two offline retailers and one online company, this paper analyzes the case where the online company can expand its offline market by either acquiring or jointing (e.g. stakeholding) with one offline retailer. The former strategy (named Strategy A) allows the online company to fully control and capture residual claims of the offline retailer. With the adoption of the latter strategy (named Strategy C), on the other hand, the online company can obtain a fixed proportion of its offline partner’s quasi rent. In the price competition, the online company chooses its optimal offline expansion strategy by predicting its profit in the post-expansion market.

Findings

This paper found that the equilibrium crucially depends on the synergy effect due to online–offline integration, and such synergy also influences both consumer and social welfare. This study shows the various conditions on the synergy that affect an online company moves toward offline markets. Accordingly, this finding can assist online companies with or without retailing business to choose an optimal strategy when expanding offline markets. Moreover, by doing some necessary welfare analysis, this study shows that the online company’s offline expansion is not always benefiting consumers nor be socially desirable, which may shed some lights on the possible competition policy in the case where online companies practice in offline expansion.

Originality/value

Different from conventional wisdom in online-offline integration, the theory indicates that the offline expectation of online company may not always benefit consumers nor be socially desirable. Moreover, the findings also shed some lights on the possible competition policy in the case where online companies practice in offline expansion.

Details

Kybernetes, vol. 51 no. 1
Type: Research Article
ISSN: 0368-492X

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Article
Publication date: 1 September 2021

Yatian Liu, Heng Xu and Xiaojie Wang

The presence of asymmetric information exists between firms and the government about the firms' green innovation; this may lead to the firm's moral hazard problem of misusing the…

821

Abstract

Purpose

The presence of asymmetric information exists between firms and the government about the firms' green innovation; this may lead to the firm's moral hazard problem of misusing the government subsidy on the green innovation. Such a problem is not fully considered by the existing literature. The purpose of this study is to explore how government subsidy affects green innovation when the information of firms' innovation cannot be completed observed, and figure out the mechanisms that can alleviate the negative impact of information asymmetry, which helps to explain the factors that motivate the firms to actively engage into the green innovation with the government subsidy.

Design/methodology/approach

In a theoretical model under imperfect information in which the firm's activity on green innovation may not be fully observed, the firm could be either altruistic or not; an altruistic firm has stronger incentive to engage into corporate social responsibility (CSR) activities such as green innovation. With the presence of asymmetric information, the authors analyze the possibility of a firm's moral hazard and try to find out the condition on the information quality that can avoid such problem. To examine the results of theoretical analysis, the authors use the data of Chinese listed companies in a corresponding empirical analysis. On the basis of both theoretical and empirical the authors try to figure out the effect of the government subsidy on the green innovation by enterprise and the role of firm's characteristics of social responsibility and information quality in the green innovation with the government subsidy.

Findings

The results show that the government subsidy can promote the firm's green innovation, especially for those that are more socially responsible. The asymmetric information, however, leads to inefficiency on the green innovation. This is because that the low-quality information about the firm's behavior raises the possibility of a moral hazard. Moreover, the analyst coverage could be an efficient way to improve the quality of information, alleviating the moral hazard problem of the firm's green innovation. The main contribution is to fill the gap in the study of the government subsidy on green innovation under asymmetric information and to provide the mechanism to improve the efficiency of the subsidy to motivate green innovation by enterprise.

Practical implications

A crucial implication to policymakers is to complete and improve the system of information in the market, which can form an efficient incentive compatibility between the enterprises and the public. Such incentive compatibility can attract the enterprises to better use the government subsidy into green innovation and receive a long-run return from the public's positive feedback for their contribution on the social good.

Originality/value

Existing studies are concerned about antecedents of green innovation do not completely focus on the relationship between government subsidy and green innovation. The present paper considers that information asymmetry between the government and firms may affect the impact of government subsidy on the firms' green innovation. This conjecture is studied by the theoretical model and verified by an empirical analysis using the data of Chinese listed companies. Additionally, the empirical analysis explores the moderating effect of CSR characteristics of firms, and the analyst coverage can positively affect the promotion of the government subsidy on the firms' green innovation.

Details

Kybernetes, vol. 51 no. 12
Type: Research Article
ISSN: 0368-492X

Keywords

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Article
Publication date: 28 November 2024

Hongkang Liu, Qian Yu, Yongheng Li, Yichao Zhang, Kehui Peng, Zhiqiang Kong and Yatian Zhao

This study aims to get a better understanding of the impact of streamlined high-speed trains (HSTs) with geometric uncertainty on aerodynamic performance, as well as the…

35

Abstract

Purpose

This study aims to get a better understanding of the impact of streamlined high-speed trains (HSTs) with geometric uncertainty on aerodynamic performance, as well as the identification of the key parameters responsible for this impact. To reveal the critical parameters, this study creates a methodology for evaluating the uncertainty and sensitivity of drag coefficient induced by design parameters of HST streamlined shapes.

Design/methodology/approach

Bézier curves are used to parameterize the streamlined shape of HSTs, and there are eight design parameters required to fit the streamlined shape, followed by a series of steady Reynolds-averaged Navier–Stokes simulations. Combining the preparation work with the nonintrusive polynomial chaos method results in a workflow for uncertainty quantification and global sensitivity analysis. Based on this framework, this study quantifies the uncertainty of drag, pressure, surface friction coefficient and wake flow characteristics within the defined ranges of streamline shape parameters, as well as the contribution of each design parameter.

Findings

The results show that the change in drag reaches a maximum deviation of 15.37% from the baseline, and the impact on the tail car is more significant, with a deviation of up to 23.98%. The streamlined shape of the upper surface and the length of the pilot (The device is mounted on the front of a train’s locomotive and primarily serves to remove obstacles from the tracks, thereby preventing potential derailment.) are responsible for the dominant factors of the uncertainty in the drag for HSTs. Linear regression results show a significant quadratic polynomial relationship between the length of the pilot and the drag coefficient. The drag declines as the length of the pilot enlarges. By analyzing the case with the lowest drag, the positive pressure area in the front of pilot is greatly reduced, while the nose tip pressure of the tail is enhanced by altering the vortices in the wake. The counter-rotating vortex pair is significantly attenuated. Accordingly, exerts the impacts caused by geometric uncertainty can be found on the wake flow region, with pressure differences of up to 900 Pa. The parameters associated with the shape of the upper surface contribute significantly to the uncertainty in the core of the wake separation region.

Originality/value

The findings contribute to a better understanding of the impact of streamlined HSTs with geometric uncertainty on aerodynamic performance, as well as the identification of the key parameters responsible for this impact. Based on this study, future research could delve into the detailed design of critical areas in the streamlined shape of HSTs, as well as the direction of shape optimization to more precisely and efficiently reduce train aerodynamic drag under typical conditions.

Details

International Journal of Numerical Methods for Heat & Fluid Flow, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0961-5539

Keywords

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