Taiwanese Data Research Articles

Board independence and firm value: A quasi-natural experiment using Taiwanese data

Abstract We examine the impact on firm value of independent directors based on Taiwanese firms. Using the changes in independent director composition mandated by the Amendments of Security and Exchange Act in Taiwan as a quasi-natural experiment, we document the arguably causal and negative effect of independent directors on firm value in both the short and long run. We also find that, in response to this act, firms have tended to replace existing non-independent directors, rather than simply adding new independent directors. We also find that the new independent directors have the same qualifications as those replaced non-independent directors but are costlier and busier. The evidence reflects the short supply of qualified independent directors and might explain the negative valuation effect.

WILL THE HOUSING WEALTH EFFECT COMPENSATE THE MACRO-ECONOMY? EVIDENCE FROM TAIWAN’S DOMESTIC CONSUMPTION

This paper examines the relationship between the escalation in housing prices and categories of Taiwan’s domestic consumption. While disposable income remains constant, a rapid escalation in housing prices should have a negative impact on unaffordability within society. However, under the hypothesis of the housing wealth effect, an increase in housing values should compensate the macro-economy by increasing consumption in the GDP calculation. Taiwanese data from 2007Q1 to 2018Q1 were adopted as the sample. From the vector error correction model results, it was found that over the course of the long-run equilibrium relationship, there was a statistically significant positive relationship that the society consumes more on durable goods of communication-related nature, as well as on non-durable goods such as personal clothing and accessories and leisure/cultural tourism. As for the short-run dynamic adjustment, there was a statistically significant positive relationship that the society consumes more in the durable goods component categories. It was identified that transportationrelated consumption accounted for the major part of the durable goods component. Therefore, with the rapid escalation in housing prices, it was observed that these consumption would compensate the consumption figures in the GDP calculation in Taiwan, thereby providing evidence that housing prices were related to macroeconomic performance.

The association between non-executive compensation and firm performance

ABSTRACT This study uses Taiwanese data, where the disclosure of detailed information regarding employee compensation is mandatory, to calculate non-executive compensation and its components. We find a positive correlation between total non-executive compensation and firm performance. Besides, we find strong evidence that fixed (variable) pay is negatively (positively) correlated with firm performance. Moreover, we find significant positive (negative) incremental effects of fixed (variable) pay on firm performance among companies with high percentages of compensation classified as selling, general, and administrative expenses. Overall, our results suggest that non-executive compensation is highly correlated with firm performance, which has policy and managerial implications.

Stochastic approach for mechanistic interaction under longitudinal studies with noninformative right censoring.

Characterizing the mechanistic interactions between exposures and diseases is one of the most critical issues in epidemiologic studies. Previous studies have proposed a stochastic sufficient component cause framework, under which each sufficient cause is treated as a stochastic process instead of a time-invariant random variable. However, different types of mechanistic interactions such as synergism and agonism cannot be further identified. In this study, we proposed a stochastic marginal sufficient component cause model to conceptualize and identify agonism and synergism by exploiting the additional information. We further provided six approaches to identify and estimate agonism and synergism based on an additive hazard model and a complementary log model. Researchers can easily adjust confounding factors by including appropriate covariates into a regression model. Simulations have proven that approaches under three models are all valid tests. The power of an additive hazard model increases as the total follow-up time increases and is higher than that of the other two models. We applied this method to a Taiwanese cohort data set to investigate the mechanistic interaction among hepatitis B and C viruses on the incidence of hepatocellular carcinoma. The hazard of people with agonistic interaction is 1.28×10-5 (95% CI: 6.97×10-6 , 1.87×10-5 ), and the cumulative hazard of those people is 7.41×10-2 (95% CI: 4.09×10-2 , 1.07×10-1 ), which is approximately 3.5 times stronger than that of synergistic interaction. The proposed method makes it possible to quantify different types of mechanistic interactions in longitudinal studies with censored data.

Spatial correlations of ground motion for non‐ergodic seismic hazard analysis

SummaryTraditional probabilistic seismic hazard analysis (PSHA) uses ground‐motion models that are based on the ergodic assumption, which means that the distribution of ground motions over time at a given site is the same as their spatial distribution over different sites. Evaluations of ground‐motion data sets with multiple measurements at a given site and multiple earthquakes in a given region have shown that the ergodic assumption is not appropriate as there are strong systematic region‐specific source terms and site‐specific path and site terms that are spatially correlated. We model these correlations using a spatial Gaussian process model. Different correlations functions are employed, both stationary and non‐stationary, and the results are compared in terms of their predictive power. Spatial correlations of residuals are investigated on a Taiwanese strong‐motion data set, and ground motions are collected at the ANZA, CA array. Source effects are spatially correlated, but provide a much stronger benefit in terms of prediction for the ANZA data set than for the Taiwanese data set. We find that systematic path effects are best modeled by a non‐stationary covariance function that is dependent on source‐to‐site distance and magnitude. The correlation structure estimated from Californian data can be transferred to Taiwan if one carefully accounts for differences in magnitudes. About 50% of aleatory variance can be explained by accounting for spatial correlation.

Influence of oceanographic and climatic variability on the catch rate of yellowfin tuna (Thunnus albacares) cohorts in the Indian Ocean

Using Taiwanese longline fishery data, this study investigated the influence of climate variability and environmental conditions in the Indian Ocean on the catch rates and distribution of immature and mature cohorts of yellowfin tuna. The variations in the seasonal distribution of immature and mature cohorts suggest that yellowfin tuna move extensively from the Arabian Sea and Bay of Bengal to the coastal waters of Somalia and around Madagascar in the Indian Ocean. The high recruitments of the immature cohort were found in 1998–2002, and the catch rate of the immature and mature cohorts revealed positive associations with periodicities of approximately 3–4 years. We found that the distributions and catch rates of the two cohorts were sensitive to variations in climatic and marine environments. Sea surface temperature was the most influential environmental variable for both cohorts, and Chl-a was not statistically significant for the immature cohort. There was a significant negative correlation between the catch rate of the immature and mature cohort and Indian Ocean Dipoles (IODs), with periodicities of approximately 3 years during the study period, and had periodicities of approximately 1–3 years with El Niño/Southern Oscillation (ENSO) events. Furthermore, the influence of IODs exhibited greater variance than that of ENSO events, and the influence of ENSO was only evident near the Arabian Sea. The influence of concurrent positive IOD and El Niño events led to lower catch rates for the mature cohort in 2008–2009 in the northwestern Indian Ocean.

Empirical habitat suitability model for immature albacore tuna in the North Pacific Ocean obtained using multisatellite remote sensing data

ABSTRACT This study developed an empirical habitat suitability model for identifying the optimal habitat of immature albacore tuna in the North Pacific Ocean (NPO) by using multisatellite remote sensing data and Taiwanese longline fisheries data between 2009 and 2016. An arithmetic mean model with five environmental variables is suggested to be appropriate for explaining the habitat variance of albacore in the NPO. A monthly albacore mean catch per unit effort (CPUE) of larger than 29.5 individuals/1,000 hooks occurred from November to March and was distributed over 25–40° N. The optimal range of environmental variables in the sea surface temperature, sea surface height, mixed layer depth, sea surface chlorophyll-a concentration of the previous month, and eddy kinetic energy for the habitat of albacore are suggested to be approximately 17–21°C, 0.24–0.84 m, 15–100 m, 0.07–0.29 mg m−3, and 0.0001–0.0031 m2 s−2, respectively. We discovered a significant positive relationship between the suitable habitat area and nominal CPUE of immature albacore in the NPO (Pearson’s correlation coefficient, r = 0.982). The mean position of the optimum habitat shifted southwardly from near 38° N in November to near 28–31° N during February to March. Overall, frontal structures play a major role in the stimulation of potential albacore habitats.

Electronic storybook design, kindergartners' visual attention, and print awareness: An eye-tracking investigation

The purpose of this study was to understand children's visual attention during shared storybook reading when the print and picture area sizes are identical, as well as to understand which electronic storybook design is best able to increase children's attention to the print and their print awareness. To this end, we modified the electronic storybook's design, measured children's print awareness, and used an eye-tracker to measure children's visual attention during reading. Sixty-one 4–5 year old Taiwanese children's data were analyzed in this study. This study was conducted over a 6-week period: one week for pretest, four weeks of intervention, and one week for posttest. After the pretest stage, the kindergartners were split into three groups: traditional storybook, highlight synchronization (implicit instruction), and print discussion (explicit instruction). The results suggested that: First, when the print and picture area sizes were identical, children spent more than 19% of their time looking at the print area, substantially higher than previous studies (e.g. Evans & Saint-Aubin, 2005; Justice, Skibbe, Canning, & Lankford, 2005; Roy-Charland, Perron, Boulard, Chamberland, & Hoffman, 2015); second, the highlight synchronization design did entice children to look at the print more (from 19% to 38% reading time); third, exposure to either the reading highlight synchronization or the print discussion storybook designs for four weeks improved the children's print awareness.

Family needs during critical illness in the Emergency Department: A retrospective factor analysis of data from three countries.

To examine underlying factor structure of the Critical Care Family Needs Inventory-Emergency Department across three countries to identify similarities and differences. Understanding family needs assists nurses to provide family-centred care to deliver optimal outcomes for critically ill patients and their families in Emergency Departments. Retrospective secondary analyses of data collected in three cross-sectional surveys. Convenience samples involved recruitment of family members accompanying a critically ill relative into four Emergency Departments in Australia (2), South Africa (1) and Taiwan (1). Item-matched raw data from 374 responses to 40 items from the surveys were collated and analysed using confirmatory factor analysis methods. Reporting adhered to an adapted STROBE checklist. The factor structure of the 40-item Critical Care Family Needs Inventory-Emergency Department differed between countries. Analyses of the Australian data revealed a four-factor solution comprised of 18 items across four categories of family need (support, communication, participation and comfort); the Taiwanese data also demonstrated a four-factor solution comprised of 13 items (support, communication, participation and comfort); alternatively, the South African data revealed a two-factor solution comprised of nine items (communication and participation). Fifteen items did not match across the countries. However, loading for four items common across all three countries was related to family participation (3) and communication (1). The findings suggest family members from different countries responded to Critical Care Family Needs Inventory-Emergency Department items in different ways. Consistent with concepts of family-centred care, the study identified participation and communication needs that were common across the countries. The outcomes illustrate the challenge of providing appropriate care for family members during critical illness of a relative in the ED. Family perceptions of important needs during critical illness in the Emergency Department differ across countries; hence, the Critical Care Family Needs Inventory-Emergency Department has limited utility. Participation and communication needs emerged as common family needs.

Medical providers as double agents in a universal health care system: evidence from generic pharmaceutical adoption in Taiwan

This paper investigates medical providers’ generic pharmaceutical adoption in Taiwan, stresses that this decision involves the interests of providers, patients and insurance payer. We examine this prescription behavior using Taiwanese data because patients and physicians did not self-select their insurance plans under a universal health care system. Physicians in Taiwan also respond to strong financial incentives because they are allowed to both prescribe and dispense drugs. The empirical results show that a larger price difference between brand-name and generic drugs increases physicians’ likelihood for prescribing generic prescriptions. However, this effect decreases as the payer’s cost share percentage increases. This study also demonstrates that some physicians prescribed more generic drugs than the others, including the hospital and clinic owners, and the ones practicing in clinics and private institutions.

Earnings Management in Response to Corporate Tax Rate Reduction Under an Imputation Tax System

Our study explores how firms respond to a tax rate reduction under an imputation tax system. By exploring Taiwanese data, we find that firms engage in significant downward earnings management preceding a tax rate reduction, and this earnings management behavior reverses in the following year. We further explore what factors drive this finding, given that corporate tax avoidance reduces shareholder imputation credits and thus generates limited tax benefits to most shareholders. We argue and find evidence that three factors explain the tax-induced earnings management: (1) financing benefits from tax savings, (2) managerial rent extraction, and (3) the influence of foreign and domestic institutional shareholders. Our results suggest that factors other than shareholder tax benefits have significant effects on corporate tax avoidance, suggesting that firms still have strong incentives to avoid taxes under an imputation tax system.

Overshooting: Evidence from share repurchases and subsidiary selling

If a firm repurchases its own shares to signal that they are undervalued, then the stock price should increase to its intrinsic level. However, the path that the price takes to reach its intrinsic value is not obvious. In particular, the price could overshoot before settling at the equilibrium value. Institutional details of the Taiwanese stock market make Taiwanese data well-suited to study this. We find strong evidence that a price rebound does tend to overshoot for firms that later sell some of the shares repurchased during the original repurchase. Our study supports the view of Daniel, Hirshleifer, and Subrahmanyam (1998) that intermediate-term price drift is caused by investor overconfidence, which then results in market overreaction.

The Determinants and Effects of Clients Following Audit Partners Who Switch Audit Firms

We examine the determinants of clients’ decision to follow departing partners to new audit firms and the effect of this decision on the likelihood of financial restatements. Using Taiwanese audit partner turnover data from 1984 to 2010, we find that clients are more likely to follow departing partners when the partners have more clients, longer tenure, and when both lead and concurring partners leave simultaneously. By contrast, clients are more likely to stay with their incumbent audit firms when the firms are one of the Big Four or when only the concurring partners leave. The extended partner tenure due to clients following departing partners, however, does not enhance audit quality. In fact, clients that stay at the incumbent firm experience a significant decrease in the probability of financial restatements in the first year after the audit partners leave, but clients that follow do not.

The Effects of Item Format and Cognitive Domain on Students’ Science Performance in TIMSS 2011

The purpose of this study was to examine eighth-grade students’ science performance in terms of two test design components, item format, and cognitive domain. The portion of Taiwanese data came from the 2011 administration of the Trends in International Mathematics and Science Study (TIMSS), one of the major international large-scale assessments in science. The item difficulty analysis was initially applied to show the proportion of correct items. A regression-based cumulative link mixed modeling (CLMM) approach was further utilized to estimate the impact of item format, cognitive domain, and their interaction on the students’ science scores. The results of the proportion-correct statistics showed that constructed-response items were more difficult than multiple-choice items, and that the reasoning cognitive domain items were more difficult compared to the items in the applying and knowing domains. In terms of the CLMM results, students tended to obtain higher scores when answering constructed-response items as well as items in the applying cognitive domain. When the two predictors and the interaction term were included together, the directions and magnitudes of the predictors on student science performance changed substantially. Plausible explanations for the complex nature of the effects of the two test-design predictors on student science performance are discussed. The results provide practical, empirical-based evidence for test developers, teachers, and stakeholders to be aware of the differential function of item format, cognitive domain, and their interaction in students’ science performance.

The effects of industry expertise on cost of debt: an individual auditor-level analysis

PurposeThe purpose of this paper is to examine the association between the cost of debt (COD) and auditor industry expertise using Taiwanese data. Since previous studies (Li et al., 2010) have only examined the relation between industry specialization and COD at the audit firm level in western countries, the authors further examine the association between industry specialization and COD at the individual auditor level in an Asian context.Design/methodology/approachThe authors use the interest rate on the firm’s debt as a proxy variable for the COD (Francis, Khurana and Pereira, 2005). The authors adopt three different methods to measure industry specialization, which consist of the auditors’ market share in terms of client sales and number of clients, and client assets.FindingsThe results indicate that the clients of industry specialists at individual auditor levels have a lower COD.Originality/valueFirst, the authors extend the research of Li et al. (2010) and find that the clients of individual auditor industry specialists also have a lower COD. Second, the authors also believe the evidence on the effects of industry expertise at the individual auditor level may have policy implications for regulators and public investors. Finally, in contrast to works carried out in the US market, the authors provide empirical evidence for the relation between industry specialization and COD in an Asian market.

One-Year Mortality of Patients with Chronic Kidney Disease After Spinal Cord Injury: A 14-Year Population-Based Study.

Chronic kidney disease (CKD) has become a global public health burden because of its increasing incidence, high risk of progression to end-stage renal disease (ESRD), and poor prognosis. We aimed to investigate the 1-year mortality of patients with spinal cord injury (SCI) with CKD and ESRD, and compare it with that of patients with SCI without CKD by reviewing a large Taiwanese population data set. In this 14-year retrospective cohort study, the study group (SCI with CKD group, n= 3315) and comparison group (SCI without CKD group, n= 6630) were matched at a 1:2 ratio with propensity score matching by age, sex, comorbidities, length of intensive care unit stay, and length of stay. The 1-year mortality and the relative risks of mortality were calculated. Mortality stratified by age, sex, and comorbidities was also analyzed. The SCI with CKD group had a significantly shorter survival period (10.13 vs. 10.97 months), higher 1-year mortality (17.65% vs. 8.54%), and higher risk of mortality than did the comparison group (adjusted hazard ratio, 2.25). Furthermore, patients with CKD with ESRD had a 7.71-fold higher risk of mortality than did patients with SCI without CKD for ages <50 years. The presence of comorbidities was a risk factor for mortality among patients with SCI CKD or ESRD in contrast to patients with SCI without CKD. Patients with SCI with CKD, especially those with ESRD, have a higher risk of mortality than do patients who do not have CKD. Therefore, patients with CKD should have carefully monitoring for the development of 1-year mortality after SCI, especially for ESRD.

Nowcasting GDP Growth for Small Open Economies with a Mixed-Frequency Structural Model

This paper proposes a mixed-frequency small open economy structural model, in which the structure comes from a New Keynesian dynamic stochastic general equilibrium (DSGE) model. An aggregation rule is proposed to link the latent aggregator to the observed quarterly output growth via aggregation. The resulting state-space model is estimated by the Kalman filter and the estimated current aggregator is used to nowcast the quarterly GDP growth. Taiwanese data from January 1998 to December 2015 are used to illustrate how to implement the technique. The DSGE-based mixed-frequency model outperforms the reduced-form mixed-frequency model and the MIDAS model on nowcasting Taiwan’s quarterly GDP growth.

Mandatory Retirement and Older Worker Employment Decisions: Evidence from a Matched Difference‐in‐Differences Estimator

AbstractIn 2008, the minimum age at which private‐sector workers in Taiwan could be forced by their employers to retire from their jobs was raised from 60 to 65 years. In this study, we evaluate the effects of the increase in the mandatory retirement age on the labour supply trend among the elderly using a nationally‐representative Taiwanese panel data set. Based upon the application of a combination of matching and difference‐in‐differences approaches, we find that postponing mandatory retirement has a significant effect, in terms of slowing down the withdrawal of the elderly from the labour force. Among elderly workers affected by the 2008 amendment, particularly those retiring from the public sector, the likelihood of re‐entering the labour market is found to be 3 to 4% higher than that for their counterparts who were not subject to such a constraint, a finding that clearly suggests that an increase in the mandatory retirement age helps to alleviate the problems associated with an aging population in countries where long‐term labour contracts are prevalent.

The Effects of Pay Differential on Social Undermining and Performance via Envy

Taking the self-evaluation maintenance model (Tesser, 1988) perspective, we develop a self-based model of pay differential effects. In this model, we show how emotion, specifically envy emotion, plays a role in pay differential effects on both positive (i.e., work effort and job performance) and negative (i.e., social undermining) outcomes. We argue that a large pay differential triggers a lower paid employee to experience envy, which in turn leads to both social undermining and performance behaviors. In addition, we also posit that the indirect effect of a pay differential on social undermining is moderated by an employee’s self-esteem. Using Taiwanese employee data of 614 dyads nested within 186 members of 46 teams, we found that, through envy, a pay differential positively affects social undermining, and the mediated relationship is weakened when an employee’s self-esteem is high. The theoretical and empirical implications are discussed.

Gene expression profiling combined with functional analysis identify integrin beta1 (ITGB1) as a potential prognosis biomarker in triple negative breast cancer

Triple negative breast cancer (TNBC) accounts for approximately 15–20% of all types of breast cancer, and treatment is still limited. This type of breast cancer shows a high risk of recurrence, visceral metastasis, a worse prognosis, and shorter distant metastasis-free survival. Several studies have been reported that genetics factors are associated with breast cancer disease progression and patients’ survival. In this study, we combined Taiwanese microarray data from the GEO database and The Cancer Genome Atlas (TCGA) database to study the role of Integrin Beta1 (ITGB1) in TNBC. Two triple negative breast cancer cell lines (MDA-MB-231; MDA-MB-468) were used to validate the functions of ITGB1. We found that a higher ITGB1 gene expression level was associated to lower survival. Silencing of ITGB1 inhibited TNBC cell migration, invasion and store-operated calcium influx. Our study provided a potential candidate biomarker for breast cancer cells migration, invasion and TNBC patients’ survival.