Product Market Factors Research Articles

Resolving agency and product market views of cash holdings

The new finding of this study is product market and firm investment in organization capital (“OC”) together explain cash holdings. The study integrates agency and product market views of cash holdings, resolving conflicting findings in prior literature. Controlling for product market, high OC firms hold less cash than low OC firms. Agency theory predictions regarding cash holdings are not in conflict with a product market view of cash. Univariate tests show high OC firms operate in industries more likely to experience product market strain, have higher cash holdings, take more risk, have lower leverage, lower total shareholder payouts, and higher future growth prospects. Multivariate regressions including product market factors indicate high OC firms hold less cash. It is product market factors such as market concentration and import intensity that are positively associated with cash holdings. OC and cash holdings are positively associated with firm value. Product market stress is negatively associated with firm value. Findings are robust to alternative measures of organization capital, product market and cash holdings.

Family Takaful in developing countries: the case of Middle East and North Africa (MENA)

PurposeThe purpose of this paper is to investigate the driving forces (economics and socio-demographic) that influence family Takaful demand in the Middle East and North Africa (MENA) region, using a sample of 15 countries from the MENA.Design/methodology/approachThe authors use multivariate analysis, bootstrapping and generalised method of moments techniques. They first examine a full model that combines all variables; second, a model that controls for product market factors; and finally, a model that controls for socio-demographic factors. They further separate all models into linear and log-linear demand functions.FindingsThe authors demonstrate that the relationship between the demand for family Takaful in MENA and Islamic banking deposits, education, dependency rate, female life expectancy and Muslim population is significantly positive. On the other hand, the significant factors that are inversely related to the demand for family Takaful in MENA are inflation, financial development and male life expectancy.Research limitation/implicationsThe crucial limitation of this study is the amount of data available in regards to the dependent variable, family Takaful contributions. Consequently, to improve the understanding in explaining the family Takaful demand in MENA, further research can take advantage of expanding the variables that were omitted in this research as a consequence of the unavailability of data. Some of the possible influential variables can include government social security expenditure, legal system and government policies, price of Takaful and level of competition within the Takaful and insurance industry.Originality/valueIt is obvious that there are very few studies that focus on the MENA market, and indeed, none of them gives attention to the factors that influence demand for family Takaful. While this study is expected to provide more understanding and awareness on the concept of Takaful and the factors that influence its demand, the authors hope that it would encourage more studies on various issues on the Takaful industry so as to help researchers to understand more aspects of this new emerging business.

Determinants of demand on family Takaful in Malaysia

PurposeThe purpose of this paper is to identify the driving forces that influence family Takaful demand in Malaysia. The paper examines various identified and available economics and socio‐demographic variables.Design/methodology/approachUsing ordinary least square (OLS) and generalised method of moments (GMM) techniques, the paper investigates the significance of the identified economic and socio‐demographic factors in determining the consumption of family Takaful. The paper first examines a full model that combines all variables; second, a model that controls for product market factors; and finally, a model that controls for socio‐demographic factors. Following Anderson and Nevin, Haberman, Lenten and Rulli and Josa the paper further separates all models into linear and log‐linear demand functions.FindingsThe paper demonstrates that income, Islamic banking development, education, dependency ratio and Muslim population factors are positively related to Takaful demand. On the other hand, inflation, real interest rate, financial development and life expectancy appear to be the significant factors that adversely influence the total family Takaful consumption.Research limitations/implicationsThe major limitation of this paper is the small sample size. Therefore, future studies may expand the variables omitted in this study due to unavailability of data, which may be influential in explaining the family Takaful demand in Malaysia. Possible influential variables may include government social security expenditure, price of Takaful and level of competition within the Takaful and insurance industry. Research should also be conducted on the impact of the legal system and government policies on the demand for family Takaful in the country. Finally, the study focuses solely on the determinants of demand for family Takaful. Nevertheless, the supply‐side of the equation should not be neglected and should be incorporated in future studies.Originality/valueIt is obvious that there are very few studies that focus on the Malaysian market and indeed, none of them gives attention to the factors that influence demand for family Takaful. In this regard, this study contributes in filling the gaps in the scope and coverage of studies in similar area. While this study is expected to provide more understanding and awareness on the concept of Takaful and the factors that influence its demand, the authors hope that it would encourage more studies on various issues on the Takaful industry so as to help researchers to understand more aspects of this new emerging business.

Public Enforcement/Private Monitoring: Evaluating a New Approach to Regulating the Minimum Wage

This paper examines compliance with federal minimum wage laws in the U.S. apparel industry and analyzes the impact of new methods of intervention designed to improve regulatory performance. Drawing on data from a randomized survey of apparel contractors, the author evaluates the impact of agreements between manufacturers and the government used to monitor contractor behavior as a means of improving compliance outcomes. Several non-regulatory variables predicted by theory to be important influences—the level of work skills, for example, and product market factors related to the elasticity of labor demand—are indeed found to be correlated with compliance. Nonetheless, stringent forms of contractor monitoring are associated with substantial reductions in violations of minimum wage standards. The results suggest that well-designed public/private monitoring efforts can lead to significant improvements in compliance with labor standards.

Internationalization of Western Venture Capitalists into Emerging Markets: Risk Assessment and Information in India.

This paper provides the first analysis of the internationalization of venture capital firms through an examination of risk assessment and information usage by firms in India. Personal interviews were conducted with executives in 31 (84%) of the active venture capital firms. The paper extends previous research by comparing perceptions of the behavior of domestic venture capital firms in India, foreign (primarily U.S.) venture capital firms in India and U.S. venture capital firms in their domestic markets. Foreign firms in India place significantly greater emphasis on product market factors and accountants' reports than domestic firms in India. They place significantly less emphasis on financial contributions of management in assessing risk and own due diligence and information from entrepreneurs than do U.S. firms in their domestic market. They make more use of information from trade publications and relating to production capacity and technology and information from accountants' reports than do domestic venture capital firms in India. The evidence is consistent with venture capital firms adapting to local market conditions rather than implementing "recipes" from their domestic markets.

‘Not So Clear Cut’: The Link Between Skill Recognition and Higher Wages

Feminists and labour process theorists have emphasised skill recognition as a crucial determinant in the way that work is organised and rewarded. However, the case of hairdressers challenges assumptions about the link between skilled status and higher wages. Hairdressers have had trade status for over 50 years and yet wages in the industry are significantly lower than wages of many unqualified workers. A range of labour and product market factors stand between hairdressers’ formal skill recognition and equitable wages. A distinction is drawn between institutional skill recognition and industrial skill recognition. This distinction is important because the assumed link between skilled status and higher wages has informed pay equity strategies that have focused on reform at the institutional level. An examination of the hairdressing industry shows that pay equity strategies need to operate at both the institutional and workplace level.

How Big Are the Tax Benefits of Debt?

I integrate under firm‐specific benefit functions to estimate that the capitalized tax benefit of debt equals 9.7 percent of firm value (or as low as 4.3 percent, net of personal taxes). The typical firm could double tax benefits by issuing debt until the marginal tax benefit begins to decline. I infer how aggressively a firm uses debt by observing the shape of its tax benefit function. Paradoxically, large, liquid, profitable firms with low expected distress costs use debt conservatively. Product market factors, growth options, low asset collateral, and planning for future expenditures lead to conservative debt usage. Conservative debt policy is persistent.

Channel Selection for New Industrial Products: A Framework, Method, and Application

The authors present a framework and method for addressing the new product channel choice decision and demonstrate its use with an application for a new industrial product. First, on the basis of extant literature, they disaggregate a distribution channel into eight functional components. These functions are representative of the various product-market factors influencing channel choice. Next, they offer a three-step method that involves (1) obtaining evaluations of the new product on each function from several experts, (2) analytically combining those evaluations, and (3) identifying the channel alternative that effectively and efficiently addresses customer requirements of those functions. This method requires extensive management participation to facilitate its implementation. Finally, the authors provide an illustrative application to demonstrate its managerial usefulness.

Channel Selection for New Industrial Products: A Framework, Method, and Application

The authors present a framework and method for addressing the new product channel choice decision and demonstrate its use with an application for a new industrial product. First, on the basis of extant literature, they disaggregate a distribution channel into eight functional components. These functions are representative of the various product-market factors influencing channel choice. Next, they offer a three-step method that involves (1) obtaining evaluations of the new product on each function from several experts, (2) analytically combining those evaluations, and (3) identifying the channel alternative that effectively and efficiently addresses customer requirements of those functions. This method requires extensive management participation to facilitate its implementation. Finally, the authors provide an illustrative application to demonstrate its managerial usefulness.

Productive Decentralisation in Three European Regions

Recent work on nonmetropolitan industrialisation has tended to stress environmental attractiveness and the shortage of space for in situ expansion as the factors largely responsible for the process. The argument presented in this paper is that the process cannot adequately be understood in such terms. Some recipient locations are not especially environmentally attractive, and in other cases decentralisation has been to sizeable urban as well as rural locations. Three European regions, South Wales (United Kingdom), Emilia—Romagna (Italy), and Aveiro (Portugal), are chosen as representative of the different kinds of area to which industry has been decentralising. In each case, metals-based (often engineering) industry has been a prime decentraliser. The reasons for this include technical change enabling economies of scale to be achieved in small productive units, the search for lower production costs, social characteristics of the work force, and product-market factors.

The state of the unions: United States and Canada

This study demonstrates that the Canadian labor movement has outperformed its American counterpart in terms of union growth, union density, and certification outcomes. Labor and product market factors do not appear to be major contributing factors. Public policy and increased employer resistance have played a critical role, particularly in the decline of unionization in the United States. Union-related variables — militancy, structure, and the desire and ability to organize — are also important in explaining the divergent union trends in the two countries.

Unionism and Employer Discrimination: Analysis of 8(a)(3) Violations

Summary and ConclusionsThe choice model of firm violations of section 8(a)(3) of the NLRA specified here was tested for the period 1972–1979 using a sample of firms from the New York and American Stock Exchange. The results show that previous violations of this section of the Act, relative per cent of union organization, and changes in firm employment are statistically significant determinants of the marginal benefits of violations. These findings generally support union officials' claims that the penalties in the Act are not strong deterrents to management violations and may be considered a relatively low cost of doing business. However, assertions by union officials that product market factors are important in firm decisions to violate the Act are not supported. In addition, the results do not support NLRB officials' belief that firms that commit violations are not likely to commit them again.The fact that there are no significant differences in violations by firms in our sample as a result of product market variables or industry implies that ethical considerations may be a factor in choosing to violate the Act. Since current penalties are low, and past violations are significant in determining current violators, an increase in penalties may reduce violations by those who do not consider the ethical implications of the Act. If the intent of the current NLRA is to reduce the coercion of employees by employers, an amendment to increase the economic costs to employers seems indicated.

Approaches To Usability In MultimediaSystems Development

effectiveness, efficiency and satisfaction with which specified users can achieve specified goals in particular environments. [Usability definition, ISO 9241- Ergonomic requirements for office work with VDT's, part ii, Guidance on usability specification and measures] The development process was studied in two small multimedia product development organisations. The objective was to examine the utility of the usability approach in multimedia systems development. Over a period of two months, the researcher collected data through questionnaires, structured interviews and non-participant observation of the development process. New product development, as opposed to maintenance and support of existing products, was studied. One company specialises in building access and communication tools for the disabled, the other in promotional and advertising products. One company has a culture based in traditional software development and uses prototyping and 'user' validation; the other company has a culture based in sales and marketing and relies on a super-designer/marketer and the use of storyboards. Both companies adopt an informal, flexible approach to product development and are dismissive of prescriptive methodologies. It was found that while some principles of interface design were being followed, others were not. Both companies practiced iterative design but not an early focus on users, early and continual user testing or integrated design. Omissions were less to do with internal, organisational barriers and more to do with external, product market factors. The gap between theory and practice was rooted in the product environment. Usability principles were most closely followed where a group of specified users could be identified. The usability approach broke down most severely where specified users did not exist or were difficult to contact or could not articulate their requirements.