The Business Review Journal

Vol. 6 * Number 1 * December. 2006

The Library of Congress, Washington, DC  *  ISSN 1553 - 5827

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The primary goal of the journal will be to provide opportunities for business related academicians and professionals from various business related fields in a global realm to publish their paper in one source. The journal will bring together academicians and professionals from all areas related business fields and related fields to interact with members inside and outside their own particular disciplines. The journal will provide opportunities for publishing researcher's paper as well as providing opportunities to view other's work.  All submissions are subject to a double blind peer review process. The journal is a refereed academic journal which  publishes the  scientific research findings in its field with the ISSN 1553-5827 issued by the Library of Congress, Washington, DC.  No Manuscript Will Be Accepted Without the Required Format.  All Manuscripts Should Be Professionally Proofread Before the Submission.  You can use for professional proofreading / editing etc...The journal will meet the quality and integrity requirements of applicable accreditation agencies (AACSB, regional) and journal evaluation organizations to insure our publications provide our authors publication venues that are recognized by their institutions for academic advancement and academically qualified statue. 

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Crew Resource Management: Assessing Potential Problems of Non-Interlinked Side

Stick Aircraft Flight Controls on Airbus Aircraft

Major Scott William Forn, Sr., U.S. Air Force

Dr. Marian C. Schultz, The University of West Florida, FL

Dr. James T. Schultz, Embry-Riddle Aeronautical University, FL



Airbus and Boeing aircraft differ greatly in one aspect; Boeing’s interlinked control columns versus Airbus’s non-interlinked side stick controllers. The side stick controllers present a unique challenge when transferring aircraft control, or intervening when necessary. The authors hypothesized that aircrew were not properly transferring control with the side sticks. Survey results revealed that 30.6% of the respondents nudged the side stick controllers, rather than taking over the aircraft per normal operating procedures, and 86.7% of these were in a leadership or examiner role. The data from the study supports the research hypothesis and reveals cause for concern from a safety perspective. It is not an issue of the yokes verses side stick controllers, but a safety problem because of a lack of interlinking. Boeing and Airbus airplanes are very similar in many ways, but differ greatly in a few key areas. Control sticks and columns versus side stick controllers is the key issue the authors are addressing in this paper. When Airbus introduced its commercial airliner, the A-300, it had a center yoke and controls that were linked together.  When one control wheel was turned, the opposite side turned in the same direction. Boeing aircraft, to include its newest airplanes, have control columns and yokes that are linked and move together. The current generation of Airbus aircraft, the A-319, 320, 321, 340, and the newest aircraft, the A-380, all have side stick controllers that are not mechanically linked together. It is this non-linked interface that this paper explored.  This study sought to determine whether crew resource management (CRM) problems and/or issues exist when conducting flight operations and training in Airbus aircraft, specifically with respect to the aircraft’s side stick controllers. The study surveyed a wide variety of crew members to determine whether standard operating procedures (SOPs) were always being followed for side stick controller usage.  Ever since the Wright Brothers flew the Flyer at Kitty Hawk, designers and engineers have been working on making airplanes more efficient, faster, able to carry more weight farther distances.


Real Rates of Return, Risk, and Exchange Rate Determination:

The Case of Euro and the U.S. Dollar

Dr. Ioannis N. Kallianiotis, University of Scranton, Scranton, PA



The objective of this analysis is to determine the movements of the exchange rate between the U.S. dollar and the euro by looking at the real rate of return and risk that financial assets have in these two economies. Risk averse speculators will try to maximize their return and minimize their risk by investing domestically or abroad, and these capital flows will affect the value of the two currencies (the exchange rate). The empirical results show that before 2001 the real return in the U.S. was high and the dollar was appreciated; after 2001, the same real return became negative and the dollar was depreciated, but after 2004 the real returns have growing positively, so the dollar is expected to appreciate, except if the risk, by investing in the U.S., would increase. Then, forecasting risk and return in countries’ assets, we can determine the direction of the exchange rate by estimating the long-term trend of these real returns in the future. Years of large current account deficits, high real return on U.S. assets, and relatively low risk have left the United States with the world’s largest stock of international liabilities. By the end of 2004, foreign net claims on the U.S. amounted to $2.5 trillion, equivalent to 22% of U.S. GDP, according to Higgins, Klitgaard, and Tille (2005, 1). This tremendous demand for U.S. assets was expected to appreciate the U.S. dollar relative to euro and the other foreign currencies, but data show exactly the opposite. Then, other factors might have affected the exchange rate between the dollar and the euro, like speculation and uncertainty for the future, due to the Middle East crises (Palestinians and Israelis, Afghanistan, Iraq, Lebanon, and the creeping ones in Syria, Iran and North Korea). It is well established that the volatility of exchange rates displays considerable persistence.


Modi Operandi of U.S. and European Fraud: Focus on Parmalat

Dr. John L. Teall, Pace University, New York, NY


Both European and U.S. firms have endured waves of corporate governance breakdowns leading to corporate fraud and failures. Recent research has proposed that differences in U.S. and European ownership structures have led to different types of managerial fraud, suggesting that the two economies require different regulatory and monitoring structures to stem fraud occurrence. This paper focuses on he Parmalat meltdown, one of the few with strong roots in both Europe and in the United States, and argues that the Parmalat case does not necessarily suggest that the root causes of managerial fraud in the two economies are fundamentally different. The core of the argument in this paper is that although the Italian roots and ownership of Parmalat do follow the typical European model, U.S.-based co-conspirators, facilitators, victims and business interests suggest that the Parmalat has very strong U.S. roots as well. Hence, the Parmalat case alone is insufficient to demonstrate that U.S. and European regulatory frameworks should be fundamentally different. Effective corporate governance is a key characteristic of successful firms that maximize shareholder wealth and realize the objectives of other corporate stakeholders. A large number of high profile incidences of corporate governance failure have led to executives being accused and convicted of committing fraud, stealing, improperly diverting funds and lying to investors to receive more money. Coffee [2005] and others argue that while both European and U.S. companies have suffered a wave of governance scandals in recent years, the natures of the scandals are fundamentally different, largely due to differences in governance structures.


The Impact of E-Mail Utilization on Job Satisfaction The Case of Multi Locations

Dr. Aysar Philip Sussan, University of Central Florida, Orlando, FL

Dr. Anthony Recascino, University of Central Florida, Orlando, FL



The use of technology, such as electronic mail and the Internet, is becoming the norm in many workplaces. This is especially true in most service organizations. This study examined how electronic mail impact job satisfaction for employees in service organizations, the case of higher education. Results of the study found that administrative level employees both sent and received more email than non-administrative level staff. Job satisfaction was not found to be related to the amount of email sent or received. No difference in job satisfaction was found between employees at the head quarter versus multiple locations, nor was there a difference in job satisfaction between those employees who were supervised primarily via email and those who had in-person supervision. Results of this study help to clarify the role of electronic mail plays in the workplace behavior and attitudes of employees. Other studies could examine Internet usage or focus on the integration of new technologies into other organizations.  The use of computers and technology is ubiquitous in service organization today (Blake, 2000).  Much of the paperwork that was done to communicate information among staff and administration has been transferred to electronic formats.  However, despite the proliferation of electronic communication, such as email, in service settings, little research has been conducted to examine the effect that electronic communication, particularly email, has on the interaction among members of the head quarter or on how email usage affects job satisfaction for employees. Much of the focus of current research related to electronic communication on college campuses has explored email communication only from a student-student, or student-teacher perspective.  For example, Gigliotti (2002) examined the effects of email on the academic relationship between first-year students and their faculty advisors.  Sipe (2000) examined how the incorporation of electronic communication into a writing class influenced faculty-student relations.  


Globalization: The Good, Bad and Ugly

Anna Turri, Sam Houston State University, Huntsville, TX

Dr. Balasundram Maniam, Sam Houston State University, Huntsville, TX

Dr. Hadley Leavell, Sam Houston State University, Huntsville, TX



Advances in technology and the expansion of trade have improved the standard of living dramatically for people around the world.  This paper will explore the costs and benefits of globalization and corporations that should globalize.  The paper will review literature giving supportive and negative effects of globalization, review different cultures thoughts on globalization, and review an example industry currently in the process of globalization.  It will also review successes in emerging economies and any long-term threats to the U.S. economy.  Finally, the paper will show an analysis of the current globalization trends in the U.S. In recent years, the term “globalization” seemed to roll off the tongues of everyone with such ease that this popular phrase has nearly become cliché. As technology and innovations increase, countries that once took days or more to share information can now share data instantaneously.  The world has not become smaller, but the ability to work across the globe is quickly becoming the norm.  Globalization allows merchandise, resources, technology, thoughts, and people to move seamlessly across national boundaries (Kellner, 2002).  Academics, economists and businesses have conflicting views regarding globalization.  These conflicts arise from differences from definitions, whether it is an end-state or a process, over the degree to which it is happening or has already reached and when globalization actually began.  This study will review each difference found and define why the differences exist.  This study also reviews the costs and benefits of globalization.  The study will then compare benefits and costs to determine if globalization is good for the economy and the world. The spectacular growth of corporations around the globe is an important topic that is concerning employees of corporations working in developed economies and exciting new entrants into the workplace in emerging economies. 


An Investigation of Business School’s On-Line Mission Statement Accessibility

Dr. Peter J. Billington, Colorado State University – Pueblo, Colorado

Dr. Michael W. Wakefield, Colorado State University – Pueblo, Colorado



AACSB accreditation standards require that  “The school publishes a mission statement …and “…disseminates its mission statement widely…”  This research studies how AACSB member schools are using internet presence as one means of disseminating their missions. The differences between accredited and non-accredited schools are analyzed for the business school mission.  Ease of locating the mission statement is one variable studied. AACSB accrediting standards (AACSB 2006a) require that “The school publishes a mission statement or its equivalent that provides direction for making decisions,”  “The school's mission statement is appropriate to higher education for management and consonant with the mission of any institution of which the school is a part,” andThe school disseminates its mission statement widely to interested parties.”  This research studies how AACSB member schools are satisfying these requirements using their internet presence as one of many means of disseminating their mission to stakeholders.  The research studies how easy it is to find a mission statement on a web site and how many clicks it takes from the initial school web page to locate the mission statement.  The differences between member and accredited schools are analyzed for the business school mission. This research is part of a long-term project on business school and university mission statements.  This work focuses on AACSB member schools only, and on business school mission statements only.  A near-obsession over mission statement development in the business world was launched in the 1970’s and early 1980’s with management philosophies espousing the value of mission statements (Drucker, 1973; Peters and Waterman, 1982). 


Real Exchange Rates and the Trade Balance: Beyond the J-Curve

Dr. Ernst Coupet, Jr., Chicago State University, Chicago, IL

Jason Coupet, University of Michigan, Ann Arbor, MI



The author tests for Granger-causality between the trade balances and real exchange rates using panel data from 21 members of the OECD countries. The results of the panel unit root test indicate a unit root in the nominal trade balances, its first difference, as well as the PPP adjusted trade balances.  These results cast a shadow over conclusions reached by some researchers in the economics literature who claim a J-curve effect, as these results may be spurious. Using the growth rate of the PPP-adjusted trade balance data provides no evidence of the J-curve effect, or causality between the two variables. However, there is weak evidence of reverse Granger causality of the PPP-adjusted trade balance Granger on the level of real exchange rates.  Since the start of the floating exchange rate era in 1973, followed by a subsequent increase in exchange rate volatility, the behavior of exchange rates has piqued the interest of economists. Much of this interest has been focused on finding empirical evidence in support of the existence of the J-curve effect, a theory that postulates that the path of the trade balance following a country’s real currency devaluation, initially deteriorates prior to improving.  Recall that Marshallian demand curves determine the demand for both domestic and foreign import. This is illustrated by: where M* = exports to foreign country, denominated in the home country’s currency, x = real exchange rate and xM = value of imports by home country, denominated in the exporting country’s currency.  Differentiating equation (1) with respect to the real exchange rate yields, Setting equation (1) to zero requires the sum of import and export price elasticities of demand to be greater unity. This is commonly known as the Marshall-Lerner condition. This states that when the trade balance begins from zero, a surplus of the account will be established when the price elasticities of import and export demand exceeds unity. 


Models of the Effects of Monitoring on Perceptions of Trust, Organizational

Justice and Organizational Outcomes

Dr. Isabelle Bélanger, University of New Brunswick, Fredericton, NB

Dr. Jeff McNally, University of New Brunswick, Fredericton, NB

Dr. Douglas Flint, University of New Brunswick, Fredericton, NB



This paper models the effects of privacy concerns under employment monitoring conditions, on the organizational outcomes of organizational commitment, supervisory commitment, and turnover intentions. Two models are presented. The first proposes a mediating role for trust in the relationship between perceptions of privacy and the organizational outcomes.  The second proposes a mediating role for organizational justice in the relationship between perceptions of privacy and organizational outcomes. This study proposes two models to account for the effects of workplace monitoring on privacy, trust, organizational justice and organizational outcomes. The organizational outcomes considered here are organizational commitment, supervisory commitment, and turnover intentions. Two models are proposed to explain the impact of monitoring on organizational outcomes.  The first proposes a mediating role for trust on the relationship between perceptions of privacy and organizational outcomes (see Figure 1).  The second suggests a mediating role for organizational justice in the relationship between perceptions of privacy and organizational outcomes (see Figure 2). Monitoring is watching over what employees do while at work using company time and resources.  Monitoring employees has been justified by employers by the need for security (Oz, Glass & Behling, 1999), health and safety (Kierkegaard, 2005), and the maintenance of efficiency and productivity standards (Oz, et al., 1999).  Monitoring continuously takes place, and has been linked to outcomes such as paced work, fear of job loss, high stress and low morale (Oz et al.1999). Much of the work on monitoring has focussed on e-mail and web browsing (Alge, 2001: Kierkegaard, 2005; Oz et al, 1999). The models proposed here extend this research to consider the effects of trust, organizational justice, organizational commitment, supervisory commitment, and turnover intentions.


Strange Bedfellows: SOX and Corporate Profitability

Dr. Gordon Arbogast, Jacksonville University, FL

Dr. Barry Thornton, Jacksonville University, FL



This paper investigates the influence of the Sarbanes-Oxley (SOX) Act on earnings per share for Fortune 500 companies.  SOX was intended to enhance the intensity of corporate governance and to restore public confidence in financial reporting by the firm’s top management. Over the past few years a number of corporate executives have alluded to the high cost of implementing SOX and indicated that it was having an adverse effect on earnings. The average earnings per share (EPS) of a representative sample of Fortune 500 companies is examined both before (2002/2003) and after (2004/2005) implementation of SOX. The results suggest that Sarbanes-Oxley had a significant positive effect on earnings per share. These findings are counter-intuitive to cited executive’s and other analysts’ views that SOX was having a negative impact on a company’s costs and earnings. The Sarbanes-Oxley Act was the most significant securities law change since the passage of the original federal securities laws in the 1933-1934 timeframe (Prentice, 2005).  In 2001 the need for stricter corporate governance measures became evident when the perception of poor corporate accounting began to undermine investor confidence in U.S. publicly traded companies. According to a study conducted by the New York State Society of Certified Public Accountants, the most common transgressions were related to net profit overstatements using a creative variety of fraudulent accounting records affecting revenues, costs, expenses, and special accounts used by firms. The most common deviations from generally accepted accounting principles (GAAP) were found in revenue recognition, reserve accounts, and understatements of debt (Bloomenthal, 2004).  The Enron collapse in 2001 followed a tidal wave of accounting discrepancies and securities fraud; Enron was the poster child for corporate corruption. 


Transnational Corporations’ R&D Localization in a Developing Nation – A Game Theory Analysis

Dr. Chen-kuo Lee, Ling Tung University, Taiwan

Dr. Shao-kai Chou, Ling Tung University, Taiwan

Tzu-yun Chang, Ling Tung University, Taiwan



In the traditional theoretical analysis of transitional corporations’ R&D, developing nations are not considered an internal decision subject. Instead, developing nations’ characteristics are predetermined and included in the framework as a restriction for the transnational corporation’s investment decisions. Apparently, traditional theories concentrate on investors’ behaviors and are short of the analysis on developing nations’ behavior mechanisms and characteristics. Therefore, traditional theories are not sufficient for the authors’ theoretical requirements. By making use of game theory, this study has developed a theoretical framework based upon the creation and distribution of the benefits derived from the investment in connection with the transnational corporations’ R&D localization, and has thus interpreted developing nations’ foreign investment policy and results effectively, and has also formulated the rules regarding the transnational corporations’ R&D localization investors and investment behaviors, as well as the developing nations’ investment behaviors and the related interactions, thereby creating a comprehensive transnational corporation’s investment theory.  As the globalization process accelerated and international competition grew fiercer than ever in the late 1990s, more and more transnational corporations adjusted their strategies accordingly—from technical resource allocation worldwide to global strategic administration. Apparently, transnational corporations have adjusted their global development strategies from market globalization and production globalization to technique globalization and R&D globalization (Reddy, 2000; Amsden, Tschang & Goto, 2001). Actually, international competition nowadays entails technical capabilities and technical innovation as core competency. In this connection, the ability to develop new techniques faster than competitors, and to apply new techniques to new products, are the highlights of competition (Barry, *2005). At the time that R&D costs and risks increase and hi-tech products’ life cycles decrease, more and more international corporations have understood that techniques are extremely important in terms of international competition advantages and, most importantly, that no corporation can obtain all techniques internally (Guellec et al., 2001)  


Vendor Selection by Means of Data Envelopment Analysis

Taqi N. Al-Faraj, King Fahd University of Petroleum and Minerals, Dhahran, Saudi Arabia



Vendor evaluation and selection is one of the most important responsibilities of purchasing managers. Decisions made in this regard are usually of long term commitments and have great impact on the performance and the final product attributes. The trend of focusing on the vendor performance factors and ignoring the vendor capabilities does not reflect the long term commitment between the purchasing firms and vendors. DEA is proposed as a multi input/output methodology for evaluating and selection of vendors. An empirical study is carried out to compare the process of selecting vendors using the current practice and the proposed methodology. The results indicate no significant difference between the traditional and the DEA methodologies. The DEA methodology, however, has the advantage of avoiding the subjectivity of estimating weights to various input and output criteria.  Additionally, vendors who are classified as inefficient by the DEA methodology will be able to identify reference vendors to benchmark against. Organizations in today's global competitive markets struggle to gain competitive advantage in all aspects of their operations. Joint business integration with suppliers (vendors) is an essential aspect of the supply chain that is found useful to both the purchasing and the selling firms. The integration is expected to lead to improved performance of the whole supply chain. This positive effect on joint business outcomes has been studied in relation to supplier alliances by Monczka et al (1998). Collaborative planning, forecasting, and replenishment are all related issues investigated by Barratt and Oliveria (2001).  In a recent study, Peterson et al (2005) have examined the effectiveness of collaborative planning between buying firms and suppliers on the performance of the supply chain.


A Transatlantic Affair: The Business Relationship of Ireland and the United States

Dennis C. Stovall, Grand Valley State University, Grand Rapids, Michigan



Businesses in the United States are beginning to realize many positive aspects of locating in Ireland.  The two countries have many shared values, with a majority speaking the same language.  In addition, the corporate tax rate of 12.5 percent in Ireland has come to be one of the greatest benefits identified by investors.  Ireland also has a willing, flexible, and productive workforce, and one of the highest levels of economic freedom in the world.  Irish officials have created organizations solely for the purpose of making the transition into the Irish economy as effortless as possible for foreign companies.  With all of this and more, Ireland’s business allure has evolved and caught the attention of corporations such as Amgen and Microsoft.  This shift is the cause of some concern for the American government as a great amount of tax revenue leaves with the companies. Rising numbers of Irish companies also are attempting to break into the American economy, however, they do not have the same resources or benefits that the American businesses receive when expanding into Ireland.  Irish companies face a unique set of obstacles.  Some Irish companies choose to establish contacts to spread the word about their business.  Others utilize trade shows to make themselves known.  But each comes with some form of the same goal: to become a grand success and a leader in its industry in America. As the benefits of becoming corporately involved in the Irish economy increase, so too does the number of U.S. companies placing or expanding their business into Ireland.  The business relationship between the United States and Ireland dramatically increased in 1969 when John A. Mulcahy, a one-third shareholder of Pfizer Inc., convinced Pfizer to move some of its business to his home country of Ireland.  Cork, Ireland, became the city of choice for a new citric acid plant built by the drug company.  Naturally, other companies looked into the reasoning behind this new venture and discovered many attractive qualities of the European country.  With this discovery, many U.S. companies made their way across the Atlantic Ocean to the island nation (Wetzel).  In the past few years relationships have been formed. 


Fashion Lifestyle Change of Malaysian Shoppers

Dr. Sofiah Abd. Rahman, Universiti Teknologi MARA

Abdul Rahman Abdul Rahim, Universiti Teknologi MARA



Contemporary works on shoppers’ profiling suggest that demographics and lifestyles are the two extensively used profiling variables. While the former has been widely used in Malaysia, the application of the latter is rather limited. This study attempts to rectify this situation and tracks fashion lifestyle changes to an earlier work (Sofiah, 1999). Shoppers were intercepted at the six major shopping complexes in Klang Valley - the most developed region in Malaysia. The findings show that several significant demographic changes have taken place in the makeup of the shopping complexes’ patrons. In turn, several lifestyle statements have moved from their original factors to form other factored solutions while the ‘quality conscious’ and ‘price conscious’ dimensions remain stable, an outcome that augurs well with past studies. Certainly all the above shifts have brought about changes to the local shopper typology.  The biggest cluster of shoppers in the earlier study was made up of ‘Career Women’, however, today, the ‘Young Executives’ segment dominates the market.  Fundamental to any retail strategy decision is customer identification (Lewison, 1994; Hasty and Reardon, 1996; Kerin and Peterson, 2000). It has been widely believed that customer identification using traditional measures such as age, gender, income, and education are deemed insufficient (Mehrota and Wells, 1977; Wind, 1978). To go beyond demographics, practitioners and academicians have made forays into psychology. By 1960s, ‘lifestyle’ research emerged. Lifestyles are defined as patterns in which people live and spend time and money (Lesser and Hughes, 1986; Plummer, 1974; Dholakia, 1999).  Maycroft (2004) sees the term ‘lifestyle’ as a mode of living that results upon making choices between predetermined options – lifestyle choices rather than life choices.  Consumer lifestyle and value are therefore reflected through and influenced their purchasing behavior (Shufeldt et al, 1998; Plummer, 1974; Sofiah, 1999).


Research on Operational and Managerial Model of Industrial Districts in Taiwan

Dr. Li-Hsing Ho, Chung Hua University, Taiwan

Chao-Lung Hsieh, Chung Hua University, Taiwan



Since 1960 when the government announced “Investment Incentive Law”, the government has solved the industrial land problem by land tax exemption and simplifying administrative procedures. Thus, the complete supply of industrial land can be regarded as the important policy and tool for the government to trigger the industrial development in Taiwan and stimulate economic growth. Since the establishment of the first industrial district—Liu-tu industrial park, through the aggressive development of nearly half of the century, there have been 56 industrial parks development and planned by Industrial Development Bureau and the developing square has reached up to 35,590 hectare which was 47% of the total industrial park square in Taiwan (79,183 hectare). In early time, with the guiding of government’s planned industry policies, the industrial park development which met the global prosperity not only fulfilled excellent land use benefit and reach the goal of district development, but also create the competitive advantages of land acquisition and low cost for the total investment environment in Taiwan. This article believed that for improving and transforming the managerial mechanism of the industrial park, the total goal of industrial park development and management and the characteristic of industrial park managerial demand should be considered at the same time in order to design a more feasible and efficient organizational operation model. Since the 80s, with the depressing tendency of the world, increasing international competition, rapid change of domestic industry structure and unstable change of political and social environments, the land and labor costs were increased considerably.


Case Study: Impact of Economic Reforms in China

Doreen M. McGunagle, Capella University



Currently, China’s growth rate is between 7-8% and accounts for approximately 4% of the global economy. What effect does the growth in this country have on its consumers and businesses? The research analyzes the changes in the economy and challenges that still confront China. The pursuit of social justice is an important goal of public policy. To compensate for market failures, the visible hands of the state operate to assure basic needs, protect living standards, confer equal rights, defend the weak, and create the conditions for social solidarity and integration. In many countries, public sector reforms have veered towards smaller governments and leaner welfare to better respond to the demands of global competition. The market, in chasing efficiency, trimming costs, in particular labor costs, and tightening benefits, has prevailed globally. The People’s Republic of China prided itself on being a faithful follower of socialist ideology and its social template, living proof of the superiority of socialism. To achieve the goal of social justice, the party state made use of a number of devices (Wong, 2004). First, there was the careful creation of a socialist institutional framework. This comprised a public ownership system, a command economy, an almighty party-state, an urban work unit system, and rural collectives as the structures that dictate resource mobilization and distribution.


A Fuzzy Multiobjective Programming Approach for Supplier Selection in a Supply Chain

Dr. C. Hakan Kagnicioglu, Anadolu University, Eskiþehir, Turkey



Supplier selection is one of the most important decisions given in supply chain management for a company. There are many conflicting and vague objectives and constraints that need to be met at the same time in real life. This makes the decision process more complicated. In this study, a fuzzy multiobjective model is proposed for supplier selection problem. In this model, both the objectives and some of the constraints are fuzzy. Besides, some constraints are triangular fuzzy numbers. For the solution of this model two approaches are used: Zimmerman Approach, Tiwari, Dharmar and Rao’s Weighted Additive Approach. In the second approach weights of the objectives and constraints are determined by supertransitive approximation. Then the results are explained and compared by their advantages and disadvantages. Supply chain management integrates suppliers, manuýfacturers, distributors and customers through the use of information technology to meet customer expectations efficiently and effectively(Vonderembse et al., 2006). Within this management, supplier selection is a critical activity of purchasing management in a supply chain, due to key role of supplier’s performance on cost, quality, delivery and service in achieving the objectives of a supply chain. With changing dymnanics, due to global competition and new technological advances in numerous areas, future researchers interested in strategic sourcing and supplier selection will have many opportunities to explore critical supply chain management issues.


Effects of Expert Collective Efficacy on Hiring Decision Making Under the Informational Asymmetry

Tsang Kai Hung, National Changhua University of Education, Taiwan



Responding to the increasing pressure for organizations to be competitive, human resource departments play an important role. However, the hiring process is more complex today. One reason is that managers who make hiring decision are faced with more environment factors, more information, and less time to (Butler, Ferris & Napier, 1991). Due to the informational asymmetry between interviewers and survey managers, interviewers have information that managers do not, the managers are unable to assess the true difficulty of cases, and consequently they cannot make the right hiring decisions The purpose of this study is to provide a framework to predict how expert team hiring decision-making and collective efficacy can produce successful hiring outcomes. Decision-making has always played an important role in management. Cognitive psychologist Simon (1960) believed that the decision-making setup was the heart of management activities. Decision-making setup techniques allow high-level thinking and most certainly affect hiring outcomes. Decision-making is one of the basic duties and responsibilities of senior managers.. An ideal hiring system should be planned and designed so that aspiring professionals will have room for development in smooth and versatile work environments (Balkin, Gomez-Mejia & Cardy, 1995). Restrictive conditions determine whether enterprise hiring strategies are comprehensive and executable. As a result employee turnover rises and worker dissatisfaction increases. Other flaws in the hiring process bring unsuitable candidates into the company, creating additional problems for human resource management. However, due to informational asymmetry of the recruitment process, organizations adopt criteria such as the “value” and “uniqueness” of a potential employee.


Assessment of a State Sponsored Marketing Program to Promote Rural Tourism: 

A Case Study using the 2004 to 2005 Texas Yes! Hometown STARS Program

Dr. Roger Hanagriff, Sam Houston State University, Huntsville, TX

Dr. Michael Lau, Dr. Stanley Kelley, Sam Houston State University, Huntsville, TX

Dr. Marcy Beverly, Sam Houston State University, Huntsville, TX



Hometown STARS (Supporting Tourism and Rural Success) began with Texas Department of Agriculture’s (TDA) Texas Yes! program and is a broad-based membership program open to rural communities, businesses and organizations.  It is designed to help rural communities leverage their tourism marketing dollars through a competitive dollar-for-dollar matching reimbursement program open to Texas Yes! community members.  Funded activities have included fine arts festivals, cook-offs, sheepdog trials and cow calling events.  Data was captured by using two survey forms for each event.  Texas Yes! funding was not the only support for these events, yet state funding did play a role in increasing event exposure.  The value of attendance was measured in terms of visitor spending, and the result for 31 events is $9.8 million.  Considering the 17 percent investment share of Texas Yes! funding, ROI for direct and economic impacts are $9.80 and $20.66, respectively.  These economic returns illustrate outstanding returns for state funds and support continued and expanded investment in similar rural community events.  The Texas Yes! Hometown STARS (Supporting Tourism and Rural Success) program was developed to assist rural communities in advertising rural events, thus leading to rural economic development.  Fine arts festivals, cook-offs, sheepdog trials and cow calling were just a few of the unique rural tourism events approved for matching reimbursement funds from the Texas Department of Agriculture’s (TDA) Hometown STARS program.  Hometown STARS began with TDA’s Texas Yes! program in late 2003.  Texas Yes! is a broad-based membership program open to rural communities, businesses and organizations. 


Pricing First-to-Default Credit Linked Notes with the Intersection of Market and Credit Risks

Dr. Chou-Wen Wang, National Kaohsiung First University of Science and Technology



In practice, the first-to-default credit linked notes (hereafter CLNs) can be issued by the special purpose vehicles (hereafter SPVs) and by the protection buyers who own the reference obligations. The first contribution of this paper is to derive the closed form solutions of first-to-default CLNs which are issued by those two entities, respectively. The second contribution of this paper is to prove that the values of first-to-default CLNs issued by the SPVs are higher than the ones issued by the protection buyers, especially for the SPVs that only hold the treasury bonds as collateral. As a recent[JMG1] , it is a better solution for issuing first-to-default CLNs through SPVs. This result is consistent with the cases in practice.  In the 1990s, the financial crises in Latin America, Thailand, Korea and Taiwan forced many financial institutions into bankruptcy. The traditional methods that financial institutions used to control credit risk such as minimum counterparty credit ratings or collateral became out of date. A financial innovation for credit risk management is the credit derivative, which allows financial managers to "short sell" the credit risk for the sake of protecting against credit deterioration in reference obligation. A survey of the global credit derivatives market provided by the British Bankers Association (BBA) in 2002 shows that the volume of credit derivatives will reach $4799 billion in 2004[JMG2] . The percentage of portfolio products (such as collateralized debt obligations) and credit-linked obligations are the second hot product, followed by the credit default swaps, with 22% of market share by 2001 and 26% of market share by 2004.


Firm Characteristics and Impact of Stock Market Liberalization: Evidence from South Africa

Dr. Daniel Makina, University of South Africa, Pretoria



Prior research on the Johannesburg Stock Exchange (JSE) of South Africa and other emerging markets has documented that liberalization reduces the cost of equity capital and that the reduction is independent of the sector in which the firm operates, and is permanent rather than transitory. Focusing on South Africa this paper examines the effect of firm characteristics on cost of equity capital following stock market liberalization. Firm characteristics examined included the size of the firm, book-to-market ratio, the leverage ratio and a firm’s unique effective liberalization date. Four main conclusions are obtained. First, the observation that foreign investors prefer large firms is supported. Second, firms with low book-to-market ratios prior to liberalization are preferred contrary to the intuition that firms in emerging markets are undervalued. Incidentally, these firms with low book-to-market ratios happen to be the large firms.  Third, within the category of firms that experienced a reduction in cost of capital, firms with low leverage ratios prior liberalization are in the majority. Fourth, different sets of firms may have their unique effective liberalization date. Models of international asset pricing predict that as capital markets integrate, the cost of capital will decline as risk is globally diversified as chronologically shown in Stulz (1981), Errunza and Losq (1985, 1989), Eun and Janakiramanan (1986) and Stulz (1999c). Empirical studies using market level analysis by Bekaert and Harvey (2000), Henry (2000a), Kim and Singal (2000), and others that have examined emerging stock market liberalization and its impact on the cost of capital support this prediction. Recent work at firm level by Patro and Wald (2004), Chari and Henry (2004), Christoffersen et al. (2004) and Makina (2005) also lends support to this prediction.


What Influences Teaching Evaluations?  Evidence from a Major Australian University

Martin Davies, University of Melbourne, Melbourne

Dr. Joseph G. Hirschberg, University of Melbourne, Melbourne

Dr. Jenny Lye, Carol Johnston, University of Melbourne, Melbourne

Ian McDonald, University of Melbourne, Melbourne



In this paper, we examine eight years of Quality of Teaching (QOT) responses from an Economics Department in an Australian University. This is done to determine what factors, besides the instructor, have an impact on the raw average student evaluation scores. Most of the previous research on student ratings has been conducted in the US. One significant difference between US and Australian tertiary education is that, on average, the number of foreign undergraduate students in Australia is 10 times the number in US institutions. We find that cultural background significantly affects student evaluations. Other factors that have an influence on the average QOT score include: year level; enrolment size; the quantitative nature of the subject; the gender of the student; fee-paying status by gender; course of study; the differences between the course mark and previous marks; the quality of workbooks; the quality of textbooks; and the QOT score relative to those in other subjects taught at the same time.  It is widespread practice in tertiary education institutions to use student feedback in the form of student evaluation surveys to evaluate teaching. Such feedback is: 1) used to improve the quality of teaching; 2) used in appraisal exercises including tenure and promotion decisions; and, 3) often an explicit requirement of university administrators. (See, e.g., Kember, Leung and Kwan 2002.)The use of these surveys has often been criticised. It has been argued that students are not the best source from which to obtain data on teaching quality. Students may have different perceptions of what is important in teaching as they do not have the knowledge necessary for its evaluation and consider it a chore (Simpson and Siguaw 2000). They are not necessarily the best judges of their instructors’ performances (Casey, Gentile and Bigger 1997), viewing them “from very limited or even tainted perspectives” (p. 472). Notwithstanding the influence of the instructor, student-specific and subject characteristics can also influence the overall ratings of instructors.


Enhancing Student Learning with only a Click

Dr. Leonard Presby, William Paterson University, Wayne, NJ

Dr. Claire Zakheim, Yeshiva University, NY, NY



The role of a professor is to help students learn. In one’s classroom, it is admirable if one can motivate and engage their students. Unfortunately, this may not be easily attained since the majority of all college faculty still teach their classes in the conventional lecture mode. An alternative and/or supplement to traditional lecture is active learning. This paper shows how implementing one approach of active learning, which incorporates a response system, helped engage students in learning the subject matter of a Quantitative Methods course as well as access their knowledge. It provided valuable feedback to both students and professors. "Active Learning" is anything that students do in a classroom other than merely passively listening to an instructor's lecture. This includes everything from listening practices which help the students  absorb what they hear, to short writing exercises in which students react to lecture material, to complex group exercises in which students apply course matter to "real life" situations and/or to new problems. "Techniques of active learning", then, are those activities which an instructor incorporates into the classroom to foster active learning. It is student-centered instruction, rather than the traditional lecture-oriented, provides a technique to inspire and engage,  discuss, explain, debate, or brainstorm. In short, it is employed to  maximize the classroom learning environment. Active learning techniques are helpful because they deemphasize lecture.


Great Leaders Know That All Change Must Start Both at the Top and the Bottom:

The Whole Human System Must Change

Dr. Michael Ba Banutu-Gomez, Rowan University, Glassboro, New Jersey



A true leader always has a vision; knows where he/she wants to go and how to get there. ­ He/She values others' skills and experiences and builds teams that make use of them.­ He/she courageously accepts responsibility for problems and is able to clearly communicate the mission, goals and objectives of his/her organization.  A great leader is willing to challenge the Status Quo while trusting and empowering people. He/She uses obstacles to create a positive future; is consistent: willing to set an example of sacrifice for the good of the next generation.  The primary task of Leadership is to establish and maintain “intimacy” (caring) because disciplined unselfishness comes about only through close social relationships.  Traditional sources of intimacy such as the family, the club, the neighborhood, life-long friendships, Mosque and church are all presently threatened by modern life-styles in today’s global world.  Intimacy is essential for healthy individuals and thus, a healthy society.  Once a society de-values intimacy, its young people will not develop a sense of community responsibility.  These young people will go on to produce the next generation that will have a permanently diminished sense of community.  This will soon result in a society solely comprised of individuals with no or only tenuous social ties to each other. By and large, leadership is an influence process and not dictatorship.  


Identifying the Effect of Firm Size on Financial Performance of SMEs

Dr. Nermin Ozgulbas, Baskent University, Turkey

Ali Serhan Koyuncugil, Capital Markets Board of Turkey, Turkey

Fikriye Yilmaz, Baskent University, Turkey



This study aims to identify the effect of firm size on financial performance of the small and medium enterprises (SMEs). The study covered 697 SMEs listed in the Istanbul Stock Exchange (ISE) between 2000 and 2005. Financial performance measurement was based on ratio analysis and relation between size and financial performance was analyzed by means of Chi-Square Independency Test.  Based on findings it was determined that firm size affected financial performance, and that financial performance of medium-sized SMEs was better than that of other enterprises.  Roles of SMEs in economic and social development differ in such a manner as to reflect varying economic and social characteristics of countries. With resilient structures SMEs have become popular enterprises in the world economy.  SMEs are considered an important element for economic growth in the USA, Japan, and the European Union. SMEs not only contribute to the economy by providing goods and services as independent economic units, but also complement development of large-scale enterprises by functioning as “related industry” for such enterprises. In addition, they provide significant contribution to the economy by creating new jobs, differentiating products, and promoting entrepreneurship and innovation.  A strong SME sector helps achieve many important socio-economic objectives of a country. For example: SMEs are the biggest source of low cost employment. SMEs help in regional and local development. SMEs respond to market fluctuations more easily. SMEs help achieve fair and equitable distribution of wealth. SMEs are key drivers for value-added exports. SMEs assist in fostering a self- help and entrepreneurial culture in the country. SMEs support and complement large scale industries ( When overall world economy is considered it is noted that SMEs, which constitute 95% of total enterprises in the world, account for 66% of total employment and 55% of total production (OECD, 2004).


A Study on South African Corporate Business Failures

Dr. Marolee Beaumont Smith, University of South Africa, Pretoria, South Africa



The purpose of this study was to identify and analyse reasons for South African corporate business failures from a lender’s perspective. The survival of a business depends on successfully managing the local and international environment in which it operates. A number of local and international factors affecting the business environment of South African firms were discussed. Empirical research was undertaken in a specialised division of one of the big four lending institutions in South Africa. Personal interviews conducted with institutional experts and analysis of actual business failure cases revealed that the principal causes of corporate business failure were inadequate management planning and control, failure to respond to changing circumstances and lack of focus on core business. Some of the critical success factors for corporate turnaround included generation of positive cash flow, effective communication at all levels, exercising prompt decision-making and an acceptable level of mutual trust between lender and corporate business. In recent years the world has been rocked by spectacular bankruptcy and corporate governance scandals. The failures of Enron and WorldCom during 2001 and 2002 represent the biggest business failures in US history. In the past three years telecommunications, energy and Internet companies represented the majority of the victims while in South Africa, failures were evident in small banks, information technology and investment companies. Once a corporate failure has occurred, the impact is well publicized and the effects are far-reaching. In South Africa, however, for unknown reasons, not many facts are published about the nature, size and effects of corporate failures (Robertson, 2003). The purpose of this study is to investigate reasons for corporate business failure in South Africa from the lender’s perspective and to identify critical success factors for corporate turnaround.


Improving Quality of Work-Life: Implications for Human Resources

Dr. M. Akdere, University of Wisconsin-Milwaukee, Milwaukee, WI



Family is defined as a group of individuals living under one roof and usually under one head (Merriam-Webster Dictionary, 2005). Work is an essential part of people’s lives in providing livelihood for families. Therefore, family and work cannot be separated from each other. However, there are emerging problems around work and family, and these problems need to be approached holistically as they are closely interconnected, and inevitably affect each other. Furthermore, these problems have significant impact on organizational ability to attract and retain skilled people, achieving higher levels of production, employee satisfaction and morale, innovation, and teamwork (Gurvis & Patterson, 2005). The issue of “work-life quality” has become critical in the last two decades due to the increasing demands of today’s business environment and family structure. This, in fact, has been the case for many professions and fields. As a result of rapid globalization, companies are under great pressure to compete and remain profitable. This pressure is translated at the employee level as increased work hours and job-related stress. Consequently, organizations are seeking ways to address the issues around achieving quality of work-life to retain their workforce and attract the most talented potential employees.  Using a Human Resources approach, the purpose of this paper, thus, is to review and examine existing issues and challenges related to work-life balance, and provide examples of how organizations should respond to help employees achieve quality of work-life as it impacts both the workplace and home. Traditionally, a Human Resources approach to quality of work-life has been supporting employees in their daily work-life challenges and advocating on their behalf, calling organizations to assume corporate social responsibility.


Case Study: A Young Entrepreneur Going Global

Dr. Falih M. Alsaaty, Bowie State University, Maryland



This is a case study in international entrepreneurship intended to convey the strategic vision, business expertise, and managerial style of a young Jordanian-born entrepreneur named Ahmad Taha, who arrived in the United States in the early1990s to study engineering and ended up an accomplished dealer and exporter of second-hand restaurant equipment. Mr. Taha was an outstanding planner, a calculated risk taker, and a team player. His strategy was to “go global” to take advantage of market opportunities and, simultaneously, satisfy customer demand. He capitalized on the “Re-use and Re-cycle” movement, and the trend toward frugality.  Few young people in the United States could fully understand the meaning of the phrase “a land of opportunity” as Mr. Ahmad Taha, a Jordanian-born entrepreneur. For the past several years, he had steadily been cultivating market opportunities, both domestic and foreign. He had been mining a profitable niche that many shrewd business people were unaware of. Mr. Taha, a dealer and exporter of second-hand restaurant equipment, arrived in the U.S. in 1990 with his family – his parents and two siblings. His arrival in the country was unplanned and unexpected. While he was a freshman at the School of Engineering in Amman University, Jordan, his father, a specialist in fish farming in the Ministry of Agriculture, was appointed for a three-year term as an economist at the International Bank for Reconstruction and Development (the World Bank) in Washington, DC. It should be noted that the Bank typically offers this kind of in-house residency to foreign government officials as part of a long-standing arrangement with member countries. Upon arrival to the U.S., Mr. Taha enrolled in an engineering college in Arlington, Virginia and, at the same time, was offered employment in the college’s mechanical engineering laboratory to work for 20 hours a week. The library and the laboratory soon became indispensable destinations for his daily activities, where he spent long hours working and studying.


Utilizing Skandia Navigator System and Ohlson Model to Evaluate the Intellectual Capital

Performance for Taiwan Electronic Corporations

Jui-Chi Wang (Amanda), Hsing-Wu College, Taiwan



When a company develops the intellectual capital infrastructure and investment, the market value of the company will appreciate and increase its book value several times since intellectual capital is the core differentiator and driver of that company. This study will examine the relationship between intellectual capital and market value in the Taiwan electronic industry.  The intellectual capital approach of Skandia Navigator System was reviewed for its intellectual capital indicator selection.  Furthermore, the Ohlson model was utilized for the framework of this study. The research subjects and periods are publicly traded companies in the Taiwan electronic industry from 2002 to 2004. The secondary data is from Taiwan Economic Journal Data Bank and Taiwan Stock Exchange Market Observation Post System.  The descriptive statistics and multiple regression statistical methods are employed and data is tested using SPSS 12.0 statistics software application.  The results of this study indicate that there is significant relationship between (1) human capital and market value of the company (2) customer capital and market value of the company (3) innovation capital and market value of the company and (4) intellectual capital and market value of the company.  In order to be successful in a highly global competitive environment, the key is to utilize more intellectual capital resources and less physical and financial assets.  More and more companies are starting to pay attention to intangible assets because they can create greater value than from the company’s physical assets. With the economic knowledge diffused at the end of the 20th century, companies have emphasized intrinsic human resource capital and knowledge technology rather than financial information.  Lynn (1998) indicates that many companies have announced successful experiences from intellectual capital management and assessment by using strategic methods.  For example, Skandia Insurance Company developed the Skandia Navigator System in 1995 in order to manage its intellectual capital.


Malaysia: Islamic Money Market Instruments

Nuradli Ridzwan Shah Mohd Dali, Islamic University College of Malaysia, Sembilan, Malaysia

Abdul Ghaffar Ismail, Universiti Kebangsaan Malaysia, Malaysia



Central Bank of Malaysia established the Islamic money market in 1994 to cater to the needs of the Islamic Banks by managing its excess and deficits funds in short term investments. The Mudharabah Interbank Investment (MII) was the first instrument introduced. The number of instruments developed increased from year to year to include a single or multiple Islamic contracts from mudharabah (profit and loss sharing), musyarakah (partnership), murabahah (mark up cost), bay bithaman ajil (deferred payment sale), bay ad dayn (sale of debt), and bay al inah (instantaneous sale and purchase). This is an introductory paper to the Islamic money market with the aim of understanding the overall process of the instruments and the Islamic contracts used in the sale and purchase of securities in the primary and secondary interbank money market. The money market where medium and short-term instruments are being traded is dissimilar from the debt and capital market, which dealt with long-term investments. An increase in the number of money market instruments in the Islamic money market increased the Islamic bank’s exposure to a wide range of risks such as credit, operational, profit and liquidity risks.  We will attempt to explain the process of Islamic money market instruments and the possible Islamic contracts used in the sale and purchase of securities in the primary and secondary interbank money markets. The Islamic money market was established to avoid interest, uncertainty (gharar) and gambling (maisir) as promulgated by the Shariah divine laws.


Relationships among Personality Traits, Job Characteristics, Job Satisfaction and Organizational Commitment -

An Empirical Study in Taiwan

Su-Chao Chang, Ph.D., National Cheng Kung University, Tainan, Taiwan

Ming-Shing Lee, National Cheng Kung University and Lecturer, Far-East University, Taiwan



 Within this research, we use path analysis to explore the relationships among personality traits, job characteristics, job satisfaction and organizational commitment. A questionnaire survey is utilized to focus on banking industries, service industries and manufacturing industries for empirical study. A total of 1350 questionnaires were sent with 562 valid questionnaires received. Among them, 43 replies were from banking industries, 149 replies were from service industries and 370 replies were from manufacture industries. Based on the study results, we make five conclusions: 1) employees with positive personality traits have a positively significant influence on job satisfaction; 2) job characteristics have a positively significant influence on job satisfaction; 3) job satisfaction has a positively significant influence on organizational commitment; 4) employees with positive personality traits  have a positively significant influence on organizational commitment; and 5) job characteristics have a positively significant influence on organizational commitment.


A Study on the Relationship between Corporate Governance Mechanisms and Management Effectiveness

Chung-Cheng Hsu, Ling Tung College and Ph.D. Student, Da-Yeh University, Taiwan

Ming-Jian Shen, Chin Min Institute of Technology and Ph.D. Student, Da-Yeh University, Taiwan

Ming-Chia Chen, Ph.D. Student, Da-Yeh University, Taiwan

Chin-Fang Chao, Ling Tung College, Taiwan



 This research mainly examines the effects of corporate governance on management efficiency using the SEM methodology to conduct tests. Management efficiency is calculated using Data Envelopment Analysis (DEA). The measuring variables for management efficiency are total production efficiency, allocative efficiency, technical efficiency, scale efficiency, and pure technical efficiency. Specifically, this research finds the effects of corporate governance variables on management efficiency for groups with different levels of information transparency and the significant differences in component factors for groups with different levels of information transparency. This research conducts path analyses of various dimensions for the high and low information transparency groups. Tests and comparisons find that in path analyses, the effects of shareholding structure on management efficiency, board supervisory structure on the proportion of remuneration of directors and supervisors, shareholding structure on the proportion of shareholding of directors and supervisors, and management efficiency on allocative efficiency are significantly higher for the high information transparency group than for the low information transparency group. In path analyses, the effects of shareholding structure on the proportion of shareholding of managers, board supervisory structure on the proportion of independent directors and supervisors, management efficiency on technical efficiency, management efficiency on scale efficiency, and management efficiency on pure technical efficiency are significantly higher for the low information transparency group than for the high information transparency group.


How E-Business Leadership Results in Customer Satisfaction, and Customer Lifetime Value

Mohammed M. Nadeem, Ph.D., National University, San Jose, CA



 The objective of this study is to provide organizations an understanding of the strategic role of customer satisfaction, and how it can be used as a vital marketing tool for customer life time value through E-Business leadership.  The main research question addressed by this study is why an organization should place customer value at the center of what it does to direct its long and short-term projects, and why should it use customer satisfaction instead of value?  This study also explains why companies must change their own behaviors to leverage customer lifetime value. Various issues are considered including, how does the customer value affect the process of e-marketing, and how does the return on customer entails in a growing networked economy. An in-depth review of theory, research, and practice is undertaken to understand the relationships between return on customer, customer satisfaction, and customer lifetime value.  The study also explains how the e-business leadership strengthens the integral role technology plays in leveraging organizations bottom-line by focusing on return on customer.  


Applying Innovation Jump Model to Evaluate the Value of the Firm Under Uncertainty

Ching-hsien Chiu, National Sun Yat-Sen University, and Lecturer, Far East University, Taiwan



 This paper presents a decision model using the real options approach for evaluating the innovation jump growth smart-phone business in the face of economic uncertainty and three jump events. Furthermore, this paper considers the effect of uncertainty after investing a smart-phone project to determine the optimal threshold for implementing the investment project. Additionally, the differences between the real options approach, innovation jump Diffusion and the net present value method are discussed. Numerical analysis of the smart-phone market using innovation jump diffusion is more consistent with the observed investment data than similar analysis using the net present value method and ROA for supporting the investment decisions in the face of uncertainty and innovation jump. From the result of sensitivity analysis and numerical example is, (1) increasing price uncertainty will increase the threshold and delay the timing of smart-phone investment. This is consistent with the results of real option view. (2) A higher fixed cost (invest cost) leads to higher threshold. (3) The higher Poisson jump parameter, the threshold is lower. (4) A higher discount rate (elasticity parameter, drift and the volatility), the threshold is lower.


Recreational Demand for Tuskegee National Forest:  A Non-Market Valuation

Ellene Kebede, Ph.D., Tuskegee University, AL

Mudiayi Ngandu, Ph.D., Tuskegee University, AL

John Schelhas, Ph.D., Tuskegee University, AL

Doris Batalia, Tuskegee University, AL



 The demand for outdoor recreational activities has been increasing in the United States and is a significant part of the lifestyle in the South over the last few years.  Forest recreational opportunities are available on public-owned forests, and some provide amenities such as, drinking water, electricity, flush toilets, and sewer at each campsite. Some charge a form of service fee.  Tuskegee National Forest (TNF) is the smallest of four of Alabama’s national forests that serves visitors from the surrounding counties but does not provide amenities. However, the public demand has not been assessed. The purpose of this study was to use non market valuation methods to estimate the visitors’ demand and willingness to pay for such amenities, if they were to be provided as well as to assess the different recreational activities in TNF.  Visitors’ data were collected and regression analysis was employed to estimate the recreational demand. The result suggests that there is a demand for the TNF.  The visitors who come from distance are more willing to pay entrance fee than the visitors from closer proximity.


Socioeconomic Profile of Students of Human Resources in Turkey and Their Occupational Expectations

Dr. Harun Demirkaya, Kocaeli University, Gebze, Kocaeli, Turkey



 One of the most important results of the processes of information society is that it has radically changed the way we look at human resources. Man who produces and works with information has assumed a synergic role combining all other resources. This phenomenon has brought human resources to the foreground. Parallel to global developments, human resources management is rapidly developing in Turkey. It is becoming a part of strategic management, and HR managers are climbing to the top of organizations.  The results of a recent research conducted on students of Human Resources Program at Gebze Vocational School of Kocaeli University, which is the first undergraduate school in the field of human resources in Turkey, highlight the process of professionalization of human resources management, training and education of professionals, and the future of this profession.   Today our world is passing through the processes of information society brought about by tremendous developments seen in information and communication technologies. Concurrent with those developments globalization, which eliminates borders in terms of free movement of goods, services and information, has taken competition from national to international dimensions.


The Foreign Exchange Rate Fluctuations on Export-Oriented Taiwan Companies

Yi-Wen Chen, Hsing Wu College, Taiwan, R.O.C



 This study offers a concise exploration of the effects of foreign exchange rate fluctuations on Taiwanese export-oriented companies.  In contrast to the findings of studies on the impact of foreign exchange rate fluctuations on Western corporations, research on corporations in Taiwan reveal the significance of the government in influencing the effects of the foreign exchange rate fluctuations in the region.  Furthermore, the integration of the country’s economy with regional and world economies also plays a significant role in shaping the corporations’ susceptibility to foreign exchange rates.  Because of the interventionist position of the government, most corporations in Taiwan are extremely cautious in managing their risks by relying on domestic sources to fund their domestic investments.  Furthermore, they largely rely on the government to mitigate the effects of exchange rate fluctuations.  Only minorities of Taiwanese corporations obtain foreign debt, and even fewer corporations hedge their currency exposure.  Therefore, it is evident that the financial derivatives market in Taiwan is still comparatively weaker than in the West.  Nonetheless, through ongoing reforms and the liberalization of the financial sector, corporations in Taiwan might learn to manage their risks by using hedges instead of depending on the government to deal with foreign exchange rate changes.


Examining Ethical Intentions of Individual Employees of Taiwan from Theory of Planned Behavior

Miao-Ling Fang, Southern Taiwan of Technology University, Taiwan



 This study attempts to better understand the ethical considerations of employees facing ethical dilemmas.  The theory of planned behavior (TPB) provided a basis for the theoretical framework of this study. This work examines the influence of independent variables on the ethical intentions of individual employees.  In predominantly Chinese relationally oriented society, interpersonal activities in Chinese culture are heavily influenced by the closeness of personal relationships.  This study therefore argues that moral dilemmas are resolved based on considerations of the relationship between the moral agent and the people whose interests are affected by the decision.  While adopting a scenario methodology, this investigation designed a scenario to explore the influences on the ethical decisions which workers may be asked to make. The study was conducted in a field setting using the survey methodology.  The subjects were employees of domestic enterprises throughout Taiwan, and a sample was collected from current full-time workers of private enterprises.  One thousand questionnaires were distributed, and 690 useable questionnaires were returned.


Financial Crises in Turkey and the Effects of Politic Administrations on Economic Equilibrium

Dr. Birgul Þakar, Kadir Has University, Istanbul, Turkey



 Political administrations have laid the grounds for an economic crisis in Turkey. In this study, the emergence of an economic crisis in Turkey and the developments after the crisis are chronologically examined and an explanation is offered as to the cause and effect relationship between the political administration and economic equilibrium in the country.  Because of the political administrations in place before the 2001 economic crisis in Turkey, the country’s market conditions that before the 2001 economic crisis can be characterized as follows: high prices of consumables, high interest rates, current account deficits, budget deficits, structural defects in government finance, rising inflation and fixed currency applications, rising government debt, declining savings rates and increased dependency on foreign capital stock. Entering into the conditions of crisis during a time when the exchange value of the country’s national currency was rising, speculative finance movements and shrinking of foreign currency reserves happened due to expectations for devaluation and because of foreign investors resistance to financing national debt, and a financial risk occurs.  During the February 2001 crisis and immediately following, devaluation and reduction of value occurred in Turkey’s stock market. While changing over to the system of floating exchange rates in the midst of this crisis, the effects of the crisis on the real economy are discussed in this study. Administered politics include financial reforms, such as the rearrangement of banking systems.


Obesity as a Factor in Workforce Productivity, Economic Costs, and Options for Remedies

Vince Luchsinger, Ph.D., University of Baltimore, MD

Lee Richardson, Ph.D., University of Baltimore, MD



 Increasingly, obesity has become a topic of interest for some time in our society from standpoints of esthetics, health, ergonomics, and accommodation in the workplace. A recent announcement by the U.S. Center for Disease Control and Prevention in Atlanta signaled strong concern over the extent of overweight and obese population. Further, a recent study by the Trust for America’s Health has shown obesity to be rising in the country while a national policy paralysis threatens to make the problem worse. Based upon longitudinal studies, the impact of excess weight on wellness, shorter life spans, and productivity sounded an alarm for many in the health, public policy, and corporate communities.  This work will review the development of the issue of obesity, and it’s impact, especially on organizations and the workplace. Discrimination issues will be included.  Economic costs will be a major objective for study. Further, alternatives for dealing with obesity will be explored.


China’s Capital Account Liberalization: Issues and Options

Dong Zhiyong, Ph.D., Peking University, Beijing

Yang Jiamu, Renmin University of China, Beijing



Capital account liberalization is a difficult thing. It is like fire. You do not want to play around with it. You want to heat your house, but be careful that you do not burn yourself.’ The explosive growth of international capital flows and international financial transactions is one of the most profound and far-reaching economic developments of the late twentieth and early twenty-first centuries. Few countries are unaffected.   Capital account liberalization remains one of the most controversial macroeconomic policy options to emerging economies. Although, in a significant number of cases, financial liberalization, both domestic and international, appears to have been associated with costly financial crisis, and in some regions and some periods, progress toward capital account liberalization was reversed, the re-impositions of controls were not sustained (IMF, 1998a). Even countries that have shown a willingness to re-impose controls in times of crisis have sought to return to the path of capital account liberalization and restore their international capital market access when conditions permit. Johnston and others (1998) similarly note that although the pace of liberalization slowed in 1997, and some of the Asian countries most directly affected by the crisis re-imposed a variety of restrictions on capital account transactions, the recent rise in volatility in emerging markets did not trigger a generalized resurgence of capital account restrictions.


Small and Medium Enterprise’s Benefits of Next Generation e-Business Platforms

Volker Hoyer, SAP Research CEC, St. Gallen, Switzerland

Till Janner, Peter Mayer, Marta Raus, and Christoph Schroth

SAP Research CEC and University of St. Gallen, St. Gallen, Switzerland



 In this work, we propose a novel e-Business architecture that takes into account the specific needs of small and medium-sized enterprises (SMEs). The envisioned system supports collaborative and evolutionary modeling, semi-automatic negotiation and finally execution of business processes and ensures true interoperability through a common semantic repository. Potential business partners are enabled to easily retrieve each other and initiate business relations in an extremely intuitive manner. With the help of the Balanced Scorecard approach, we thoroughly investigate economic benefits SMEs will experience when participating at this system. The analysis highlights advantages regarding five different perspectives: SMEs may capitalize from reduced operating costs and improved gains (financial perspective), increased customer satisfaction and retention (customer perspective), faster and more efficient internal processes (internal working process perspective), improved supply chain integration (supply chain perspective), and technological advancements (system benefits).


A Test of the CAPM on a Small Stock Market

Stefan B. Gunnlaugsson, University of Akureyri, Akureyri, Iceland



 The relationship between risk and returns is an important subject when studying capital market efficiency.  It is obvious that investment in riskier assets such as stocks should generate a higher return than investment in less risky assets.  It was not until the CAPM was developed that academics were able to measure risk and its return.  CAPM is based on the assumption that asset returns are linearly related to their covariance with the market’s return.  The CAPM assumes that assets with higher systematic risk have a higher return than do assets with lower systematic risk, and that assets with the same systematic risk should give the same return. The CAPM also implies that there is no relationship between firm-specific risk and returns because specific risk can be eliminated through diversification.  In this article, we present the result of a study of the validity of the CAPM on the Icelandic stock market.  This study starts in January 1999 and ends in May 2004.  The results are surprising.  They indicate that the CAPM has worked well in the small Icelandic stock market and that it, or the beta coefficient, does explain returns better than on larger foreign stock markets.  There was a strong relationship between the beta coefficient and stock returns in this research. Further, the stock returns with high betas were higher than one would expect according to the CAPM.  Therefore, the SML was steeper than one would expect according to the CAPM.  Like the CAPM predicted there was no relationship between firm-specific risk and returns. 


Student Integrity

Kevin Mason, Ph.D., Arkansas Tech University, AR



 Academic dishonesty may invalidate student performance assessments (Gomez, 2001) and may also lead to unethical behavior in the business environment (Maramark, 1999).  Therefore, academic integrity is a matter of concern for educators, students, and society as a whole (Bushweller, 1999; Wilson, 1999).  This exploratory study examines students propensity to commit questionable academic behaviors are their perceptions concerning these acts.  Academic integrity, defined as an adherence to a code of academic values (Merriam-Webster, 1997), is a matter of concern for educators, students, and society as a whole (Bushweller, 1999; Wilson, 1999).  For educators, students’ academic dishonesty leads to the invalidation of their work (Gomez, 2001).  In addition, those students with academic integrity often suffer as they compete for grades and jobs with fellow students who ‘make the grade’ by unethical means (Bushweller, 1999).  Academic integrity may also serve as a surrogate for the character of society and, thus, to the extent that integrity diminishes, unethical practices by business and institutional leaders are likely to increase.


The Impact of Disconfirmation and Customer Satisfaction on Experimental Choices for Broadband Services

Con Korkofingas, Macquarie University



 In recent years there has been disenchantment with the performance and relevance of customer satisfaction models in applied business contexts. An expected utility framework overcomes many of the weaknesses and provides a possible relevant solution. This paper applies a designed stated choice experiment to broadband services using a three-stage approach. The first stage sets product expectations and determines choices. The second stage introduces a product experience for one of the alternatives while the third stage asks respondents for a post experience choice between competing alternatives. The impact of expectations, performance and disconfirmation and satisfaction on future choices is estimated using a contingency tables and a binary logit model and contrasted with pre-experience choices. Overall, the actual performance of the broadband service is important in determining satisfaction with the service which in turn influences brand choice. Customer Satisfaction/Dissatisfaction (CSD) studies emanate from studies of life and work satisfaction in psychology and behavioural studies of the 1950’s. Initial studies (Cardozo, 1965); (Olshavsky and Miller, 1972); (Anderson, 1973) attempted to model the determinants of single equation CSD functions. Evolution of CSD modelling involved application of multi-equation models to link complex pre and post-purchase behaviours involving expectations, attitudes and future purchase intentions. (Bearden and Teel, 1983); (Hellier, Guersen et al. 2003); (Oliver, 1980); (Oliver and DeSarbo, 1988); (Oliver and Swan, 1989); (Swan and Trawick, 1981); (Teas, 1993);. In recent times, CSD models have been used as the basis of service quality evaluations and as integral components of customer relationship systems (Bolton and Drew, 1991); (Johnson and Gustafson, 2000); (Spreng et al,. 1995) ;.(Taylor and Baker, 1994)


Automobile Industry in China and India:  Backgrounds, Trends and Perspectives

Dr. Hyun-Sook Lee, International Consultant, Mexico City, Mexico

Dr. Beverlee B. Anderson, California State University San Marcos, CA



 Strategic alliances and joint ventures are growing in importance in the automobile industry.  The partnerships can be between competitors, suppliers, component manufacturers, and distributors, among others. This exploratory study analyzes the automobile industry in two developing countries, China and India. The countries are choosing different approaches to develop their auto industries.  China requires foreign firms participate in joint ventures with local companies, while India encourages direct foreign investment.  Even though both countries are similar in many respects, the Chinese auto industry has grown substantially faster. India, however, expects both its demand and production to see rapid expansion within the next few years.  A large number of industrial manufacturers are forming various types of alliances in a bid to improve their competitive position (Zineldin and Dodourova, 2005).  The number of strategic alliances has almost doubled in the past ten years and is expected to increase even more in the future.    Murray et al (2005) explained that many firms are consolidating their supplier base and developing strategic alliances with key suppliers to achieve strategic goals that range from cost and risk reduction to new skills or knowledge acquisition.  Thorelli (1986) defined strategic alliances as interorganizational governance structures that exist between markets and hierarchies.  Alliances are expected to create more value than 'go-it-alone' approaches, especially when the capabilities of the partners are combined in such a way that the competitive advantage of either the alliance or one or more of the partners is improved (Borys and Jemison, 1989). 


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