The Journal of American Academy of Business, Cambridge

Vol.  22 * Num.. 2 * March 2017

 The Library of Congress, Washington, DC   *   ISSN: 1540 – 7780

 Online Computer Library Center   *   OCLC: 805078765 

National Library of Australia * NLA: 42709473

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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 of American Academy of Business, Cambridge 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 of American Academy of Business, Cambridge is a refereed academic journal which  publishes the  scientific research findings in its field with the ISSN 1540-7780 issued by the Library of Congress, Washington, DC.  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.  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...

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Engaged Student Learning in Social Entrepreneurship: A Nonprofit Experiential Exercise Supporting AACSB Standards

Dr. Kathryn J. Ready, Winona State University, Winona, MN



From a practical standpoint, educators strive for student learning derived from academically challenging curriculum that is both active and collaborative.  This engaged learning requires sense-making as well as activity; it is more than simply involvement or participation (Harper and Quaye, 2009).  Several definitions of engagement focus on the importance of involving and empowering students in the process of shaping their learning (HEFCE, 2008) and linking student engagement, both inside and outside the classroom, to measurable outcomes (Kuh et al, 2007; Krause and Coates, 2008).  Across a myriad of measures of reasons to engage, the majority of literature on student engagement focuses on improving student learning (Trowler, 2010). The significance of student engagement is supported by the standards for AACSB accreditation in business schools.  Accreditation requires evidence of continuous quality improvement in three areas:  engagement, innovation and impact (AACSB, 2016:  2)  Standard 13 of the AACSB focuses on curricula facilitating student academic and professional engagement appropriate to the degree program type and learning goals. “Student academic and professional engagement occurs when students are actively involved in their educational experiences in both academic and professional settings, and when they are able to connect these experiences in meaningful ways” (AACSB, 2016:37).  In order to satisfy these requirements, the overall curriculum in business schools provides a myriad of activities that support experiential learning for students and are consistent with the school’s mission.  AACSB suggests that this may include areas such as projects and experiential learning opportunities where students have opportunities to interact with faculty and business leaders to gain exposure to management in both local and national contexts (AACSB, 2016:  37).  The outcome of the student learning process can be in the form of projects, papers and presentations that show clear evidence of active student engaged learning.  AACSB suggests that the experiential learning activities should be documented and show that the learning is sufficient for and consistent with the degree type of learning goals.  Ultimately, accreditation should encourage an intersection of academic and professional engagement that is consistent with quality in the context of the school’s mission (AACSB, 2016:2).  Supporting AACSB accreditation regulations, a hands-on practical approach to learning can provide opportunities for students to engage in experiential learning and helps shape the student learning process.  This paper focuses on course development in Social Entrepreneurship utilizing an engaged learning experiential approach, thereby supporting AACSB accreditation standards.  The purpose of this course is to provide students with an introduction to the major opportunities and challenges facing social entrepreneurs and the development and management of their ventures. While social entrepreneurship is discussed within profit and government organizations, the focus in this course is on the development and management of a nonprofit social venture.  This is because in most business schools, the emphasis is on profit organizations, and little attention is paid to the non-profit sector.  The course utilizes an engaged learning approach with organizational tours, guest speakers, readings, class discussions, volunteering and an integrated semester-long organizational analysis project. Students have an opportunity to meet with several social entrepreneurs, learn about specific social issues and the functioning of nonprofit organizations, and participate as a volunteer in a local nonprofit organization.  Volunteering is instrumental in utilizing course material and applying the experience to a selected nonprofit organization.  This paper describes the integration and development of a semester-long project in Social Entrepreneurship as a means of improving student engagement through experiential learning.  One way for students to learn about social entrepreneurship is to become actively involved; this involvement can take many forms, in addition to traditional classroom learning.  An engaged learning approach may include guest speakers from various organizations discussing the operations of their organization and tours of various nonprofit organizations that represent some of the many different types of established or start-up nonprofit organizations (e.g., humane societies, museums, volunteer service organizations, nature conservancies, human service organizations, etc.).  Students better understand the working of non-profit organizations by actively involving themselves in one and can then apply course learning to an organization that they are analyzing.  This paper focuses on integrating a semester-long experiential project as part of the curriculum.  This project is augmented by readings, tours, in-class speakers and volunteering.  It covers major areas instrumental to social entrepreneurial success including the development and evaluation of the mission and values statement, staffing (paid and unpaid) as well as board involvement, how the organization promotes itself to multiple constituencies (e.g., its donors, volunteers, outside funding sources), and how it financially supports itself (e.g., fund-raising, grants, and earned income strategies) as well as performance indicators.  At the culmination of the project, students provide recommendations to the local nonprofit organization to improve their operations.  Social entrepreneurship is the process of funding ventures, both for profit and not-for-profit whose missions focus on creating positive social change. According to Dees (1998), who coined the term "social entrepreneurship", social entrepreneurship involves: “adopting a mission to create and sustain social value; recognizing and relentlessly pursuing new opportunities to serve that mission; engaging in a process of continuous innovation, adaptation, and learning; acting boldly without being limited by resources currently in hand; and exhibiting a heightened sense of accountability for the outcomes created.” Austin, Stevenson, and Wei-Skillern (2006) Brinckerhoff (2000) define social entrepreneurship as an innovative, social value creating activity that can occur within or across the nonprofit, business, or government sectors. Thus, a broad definition of social entrepreneurship occurs across sectors. Courses related to managing social sector organizations grew significantly from 2003 to 2009, as did courses at top MBA schools that included social benefit content (Smith and Goulay, 2013).  Clearly, social entrepreneurship is an area that has recently been growing as an area of focus in business schools, particularly graduate schools.   The emphasis on this area is important as nonprofits account for 11.4 million jobs, 10.3% of private sector employment (BLS, 2014).  In many ways, social entrepreneurship development is similar to the traditional business or corporate entrepreneurial process.  Both areas involve opportunity recognition (adding value by addressing needs), being creative and efficient with resources, innovation, risk management, desire for control, network-building capability, and continuous learning (Dees, 1998; Perrini & Vurro, 2004).  Both areas rely on innovation as key to entrepreneurial development.  However, major differences occur in the overall objective.  The traditional firm's objective is the bottom line or net profits. The business model of a social entrepreneur is often based on a triple bottom line – profits, people and planet.  Social entrepreneurial ventures are mission based and seek to make a positive contribution to society and remedy a social need.  While doing so, they must achieve financial sustainability that is often times not derived from the product or service provided. The social enterprise oftentimes relies on philanthropy, government financial support or other areas such as charging fees for services.  Other differences occur in the staffing of the organization.  While profit organizations are responsible to their shareholders or owners, successful social entrepreneurial leaders must balance the expectations and desires of their board of directors, employees, volunteers, providers of funding and ultimately and most importantly the customers/clients - individuals the organization is attempting to serve.


Singapore’s Dominance in the Aviation Industry in South East Asia

Dr. Cindy Greenman, Embry-Riddle Aeronautical University, Prescott, AZ

Dr. Ricardo A. Carreras, Embry-Riddle Aeronautical University, Prescott, AZ



South East Asia has emerged over the past decade as one of the fastest growing aviation markets in the world.  Despite the recent economic downturn around the world, South East Asia is still achieving significant growth. With the amount of discretionary income on the rise for the people of the region, the aviation industry can expect to continue this trend. Singapore has been a leader in the South East Asian region and a leader in the aviation industry as a whole. The Association of South East Asian Nations, ASEAN, where all 10 southeastern Asian countries belong with the pursuing objective (among other specified aims, purposes and fundamental principles) of accelerating economic growth and social progress of member states through the expansion of trade, transportation and communications facilities, within a frame of close and beneficial international and regional cooperation. (ASEAN, 2015) The Asia-Pacific Economic Cooperation, APEC, where 21 selected member nations located on each side of the Pacific Ocean, established in order to leverage a sustainable and integrated economic growth for the peoples of the region, by collaborating effectively in the greater use of the primary economic activities, and by expanding trade, improving transportation and communications facilities in order to raise the standards of living of peoples of member countries. It also promotes investment in goods and services across borders through the facilitation of trade and the alignment of regulations and standards across the region. (APEC, 2015). As a participant in these two regional memberships, this research paper focuses on an analysis of the aeronautical industries of Singapore and its overall economic impact on that country. This study is framed on the premise that while Singapore’s developmental goals are aimed at maintaining its regional advantage in airport/airline socio-economics, the aviation industry in that country is so far advanced that they are doing more than just maintaining their advantage, but further distancing themselves from any competitor. Originally founded as a British colony in 1819, Singapore, officially known as the Republic of Singapore, is an island country in South East Asia. They are a tiny country, with less than 270 square miles of land space and 5.4 million people. Their natural resources include fishing and access to their deep-water ports.  Because of these deep-water ports Singapore is the focal point for the South East Asian shipping routes; they are one of the world’s busiest shipping ports in terms of tonnage handled (About Singapore, 2015).  Singapore has been ruled by the People’s Action Party (PAP) since gaining their independence in 1965.  They are purportedly a democratic state, but freedom of speech and freedom of assembly are both restricted. The World Bank’s control indicators have rated Singapore favorably on rule of law, effectiveness of the government and the control of corruption. However, it has been noted that some attributes of their processes, civil liberties, and human rights qualities are deficient (About Singapore, 2015). Singapore utilizes the parliamentary system of government.  There are three branches of government: Executive, which includes the prime minister and the cabinet who are appointed by the president and are responsible to parliament; Legislative, where parliament is unicameral and modeled after the Westminster system of parliamentary democracy; and Judiciary, made up of the State Courts and the Supreme Court (About Singapore, 2015).  According to the 2015 Index of Economic Freedom, Singapore’s score is 89.4, which puts their economy as the 2nd freest in the 2015 index. Singapore has continued to reinforce its commitment in becoming a world-class financial center and in opening their market to global trade. They are known to have a highly educated and motivated workforce (Singapore – GDP, 2015).  Singapore was the third fastest growing economy in the world in 2010.  The government of Singapore is committed to a free market and has been aggressive at pursuing foreign investment as major part of their overall economic strategy. Thus far, this approach has enabled Singapore to become a base for multinational corporations. The average tariff rate is 0 percent. Some imports are restricted, such as chewing gum and other “objectionable” items.  Singapore welcomes foreign investment but is restricted in several sectors, such as professional services, media, and financial services. According to researchers at Embry-Riddle Aeronautical University – Asia, the government of Singapore is investing vast amounts of money on tourism and infrastructure.  Gross domestic product (GDP) is a significant way of measuring the strength of a national economy. The Singapore Department of Statistics publishes their GDP on a quarterly basis. According to the World Bank, Singapore’s GDP in 2013 was $297.9 billion. Just 15 years before, in 1998, their GDP was $85.7 billion. Singapore’s highly developed, open market, trade-oriented economy has enable this country to more than triple their GDP in 15 years (The Economy of Singapore, 2014).  According to the Civil Aviation Authority of Singapore (CAAS) study of 2012, air transportation added almost S$20 billion of value-added to the Singaporean economy. Nearly half of this amount came directly from the activities at the Changi Airport. The remaining amount was indirect and induced economic activities (Sustainability of Air Transport, 2013). The aviation sector as a whole maintained 119,000 jobs in Singapore in 2009. Of those jobs, 58,000 were direct, 35,000 were indirect, 27,000 jobs were supported through the induced area, and 78,000 were employed through the catalytic effects of the aviation industry (Oxford Economics, 2011). A significant note is the fact that the jobs provided by the aviation industry are high productivity jobs. The annual value added by each employee in the industry in Singapore is S$243,290, which is almost three times higher than that of the average Singaporean worker, S$85,420.


Building the Leadership Bench: An Empirical Assessment of the Relationship between Retirement and Internal Job Promotion within the Federal and Private Sector Organizations

Dr. Osman Masahudu, Colorado State University-Global Campus, CO



The objective of this study was to determine the correlation if any between internal job promotion and retirement within the federal and private sector organizations. Sample was selected through systematic random procedure and data was collected using self-administered questionnaires from a population and sample size of 250 and 101 respectively.  Data was analyzed using descriptive analysis to describe demographic profile of respondents;  Pearson product moment correlation was used to test the relationship between the dependent (internal job promotion) and independent (retirement) variables. The results indicate a significant negative relationship between internal job promotion and retirement as a result of higher p-value (p>0.05; r=0.009; r-square = 0.000, p-value = 0.929). This means as older and experienced employees retire, internal job promotion is less likely as indicated with higher p-value. The negative slope of the coefficient indicates that an increase in retirement does not correspond with an increase in internal promotion. Employees seeking promotion may have to look elsewhere or sharpen their leadership and technical skills to prove that they are change agents. innovative and change management oriented organizations are more likely to look outside for new or different skill set to fill internal positions  created as a result of retirement.  Relying on retirement for promotion opportunities internally may seem bleak for some employees both within the federal and private sectors. It is important for employees to focus more on sharpening their skill sets either managerial or technical for potential promotion and career advancement; rather than hoping for someone to leave the organization for them to get promoted. The number of people eligible to retire but have consistently postponed their retirement has decreased significantly since 2012. For example, according to PWC employee financial wellness survey (2015), the percentage of employees planning to postpone retirement has decreased since 2012 (53%). The study adds however, that retirement confidence is up for baby boomers and Gen X and holding steady for Gen Y employees. This may be partly due to the abundant of information via technology especially for Gen X. The consistent postponement of retirement by many employees may or may create opportunities for existing ones. People enter the workforce with hopes of advancing their career. Career advancement may or may not dependent on retirement.  Most senior management understands the value of internal promotion. Internal promotion has many benefits including high morale, increased confidence, short learning curve and most importantly less costly. However, not all internally promoted employees may exhibit these characteristics especially when it comes to change management. Internally promoted employees are more likely to stick to the status quo. Innovative and change management oriented organizations both in the federal and private sectors will look more externally to fill internal positions created by retirees. The cost of investing on an external candidate may worth it especially if senior management wants to change the culture and direction of the organization. Waldman (2003), in his study of internal promotion asserts that a firm deciding on its promotion practices may be concerned with the efficient assignment of workers to tasks and with rewarding prior performance. Waldman (2003) explores the role of time inconsistency in determining promotion practices and concludes that the common practice of favoring internal candidates for promotion can be understood as a response by firms to the problem of time inconsistency. Providing long-term career opportunities to employees via promotion may help attract high quality individuals; and in the end, the organization may serve as a talent warehouse for innovation and creativity (Toder, 1994).  The purpose of this research is to investigate whether there is a relationship between retirement and job promotion within an organization in particular reference to the federal and private sectors.  As of October 9, 2015, a search in multiple databases (ProQuest, EBSCO) including Google Scholar of the title “relationship between retirement and job promotion” brought back no direct results. This makes the researcher nervous at the same time gives the researcher some warm feeling as to the relevance and impact of the subject.  The study may be useful for many federal and private sector employees who see retirement as an opportunity for promotion. A job promotion is a change of an employee while continuously employed from one General Schedule (GS) grade to a higher GS grade (OPM, 2015).  The GS is the predominant pay scale within the United States civil service. It includes the majority of white collar personnel (professional, technical, administrative, and clerical) positions (OPM, 2015). In other words, promotion is the increase in rank or responsibility of an employee within an organization; promotion may be accompanied with or without compensation and/or pay. An increase in responsibility may not lead to promotion. Mustafa (2015) defines job promotion as a change from one job to another job that is better in terms of status and responsibility. The change to the ordinary higher job may be accompanied by increased pay and privileges, but not always.  Federal agencies, departments and many private sector organizations often use job promotion to offer employees an incentive to work hard and to retain critical skills; at the same time recruiting for higher level positions (Brandon, 2013). As stated in the definition of job promotion, it may or may not be accompanied by financial rewards; however, promotion is more likely to offer employees new skill set especially among young professionals (Brandon, 2013). It is clear that federal executives may get into trouble if they try to manipulate promotions within their respective agencies and departments. This is why federal executives often direct potential applicants to the centralized government-wide recruiting website at Every piece of information about the job and promotion potential are all described; however, there are some jobs designed to be filled at the agency or department level, meaning those jobs will not be open to the general public. The public can access agency related job opportunities but their applications may not be reviewed by the hiring manager. If a job is to be filled internally, it is the responsibility of the federal manager to inform employees through an approved means about the job opening and where they can go to apply (HR Specialist, 2015).


Legal Professional Privilege and the Australian in-house Lawyer: A Review of the Current Law

Carlo Soliman, LLM, Senior Lawyer and Law Lecturer, Sydney City Law School,

Victoria University, and Australian Institute of Professional Education, Sydney



Legal professional privilege is an important common law right and its retention is vital for the proper administration of justice. The application of the doctrine to corporations and their legal advisors remains a complex and vexed area. The multiplicity of roles commonly occupied by in-house lawyers in an organisation and the potential for the conflation of functions has raised some concern. For example, the level of independence required by an in-house lawyer before their advice can be the proper subject to a claim for privilege. However, what is needed is greater clarity on the role of the in-house lawyer, particularly in light of other professional duties that such a person may hold as this inherently impacts on whether there is a proper entitlement to claim privilege. This paper discusses legal professional privilege in the context of the in-house lawyer, surveys selected applicable cases and considers the retention or abrogation of privilege. The doctrine of legal professional privilege represents an important cornerstone of the Westminster common law system where a client can repose trust and confidence in their legal representative.  Broadly, it protects from disclosure to third parties communications between a lawyer and their client as a well as communications prepared for the dominant purposes of current or anticipated litigation.(2) Whilst previous research by this author has reviewed privilege in its general operation, the context of the doctrine in relation to the corporate client and in-house legal practitioners was given little attention. Indeed, the position of these latter categories of claimants is traditionally more nebulous as the boundaries of the client-legal practitioner relationship are often harder to define precisely. Whilst the position of the in-house lawyer is often described as unique,(3) it poses a number of challenges.  For example, the potential conflation of commercial and legal roles within an organisation can be problematic especially when a claim to privilege is made. This raises the issue of the level of independence required in order for an in-house lawyer to validly make a claim for privilege.  There has been considerable judicial attention both in Australia and abroad (4) on this issue. The number of cases clearly recognises that privilege is to be upheld and that the fact that a legal representative may be involved in the commercial affairs of his or her client does not automatically render such communication(s) as lacking the character necessary for a claim to privilege to be upheld. In Australia, there is no prima facie assumption for the belief that an in house lawyer is not independent.(5) What is required is a careful appraisal of the evidence and an objective assessment of the independence(6) of the lawyer in question. The aim of this paper is to present an overview of the current the law and to highlight the important role that in-house lawyers play, and some of the risks associated by these lawyers in the provision of legal advice to their corporate clients.  Corporations represent significant consumers of legal advice either through external advisors or in-house lawyers. Not surprisingly, corporate clients are more likely to use privilege to resist the production of documents that are the subject of an investigation(7) than individual clients and statutory bodies.(8) The modern corporate landscape presents some interesting issues for the legal profession. For example, the constantly evolving role of the in-house lawyer in providing more than legal advice can obscure the independence of such advice and prejudice the otherwise genuine claim to privilege. Because corporations receive sensitive legal advice primarily through written communications, any modification or abrogation of privilege could have adverse consequences for the manner in which corporations communicate with their advisors and therefore directly impact on the effectiveness of regulatory bodies to investigate alleged breaches of any relevant legislation.  The leading case of Esso Australia Resources Ltd v Commissioner of Taxation of the Commonwealth of Australia (‘Esso’)(8) articulated the test for a successful claim to privilege. The test is that a communication must be made by the client or lawyer for the dominant purpose(10) of obtaining or dispensing legal advice. It is applied at the time that the relevant communication or document is made and is an objective one, although the subjective intention of the person responsible for the creation of the communication or document is given consideration and may be indicative of the objective dominant purpose. The circumstances under which the communications or documents were made or how the legal advice is directed are important factors in determining whether the relevant communication is privileged.(11) For example, in Kennedy v Wallace (12) the lawyer performed a number of roles and functions for the client beyond the provisions of legal advice and it appeared likely that there were several purposes in the client’s mind. The claim for privilege failed, essentially through an absence of proof of dominant purpose. Allsop J (with whom Black CJ and Emmett J agreed, in obiter), considered the appropriate approaches to be taken by the court. Their Honours recognised that there may be difficulties separating commercial and legal advice where it is interconnected.(13) If such advice is interconnected and incapable of being separated, privilege will only apply if the dominant purpose of the communication (or creation of the document) as a whole was to provide or obtain legal advice. The court also noted that if the privileged and non-privileged part of a communication can be separated that part of the communication or writing made for the dominant purpose of obtaining legal advice will be privileged even if the remainder of the communications will not.(14) Allsop J(15) held that the relevant dominant purpose in making the note had not been established. His Honour was critical of the decision at first instance by the trial judge and noted that proper inquiry was to examine the purpose of making the entries in the notes and not the purpose of the meeting in determining whether the dominant purpose was satisfied.


A Methodology for Quantifying General Damages Due to Injury

Dr. John E. Knight, University of Tennessee at Martin, Martin, TN



When physical injuries occur to someone as a result of an industrial accident or of someone else’s negligence, various damages may be claimed.  Compensatory damages can be either special damages (damages that can be quantified) or general damages (damages associated with pain and suffering, loss of consortium or mental anguish).  In this paper, a rationale for quantifying time loss due to injury is developed in an effort to make the results of the non-vocational additional time and work a quantifiable value.  A methodology will be presented that uses industrial engineering principals and time life data to provide a quantitative value so that a request for specific monetary damages can potentially be sought.  As an example,  additional time imposed losses such as prosthesis attachment several times per day (extra time and work) require specific time and work.  As such, a plaintiff could make a case for a loss of discretionary time and actual physically imposed work due to the injury.  Additionally, many other simple tasks like rising from chairs, using crutches or wheelchairs can create extra work and time loses.   This paper explores a specific methodology for quantifying the associated work and time loss associated with physical injuries.  Basically, a control group of uninjured individuals are tested performing a sample variety of everyday tasks and compared against the times for the injured individual.   Then, utilizing a real or hypothesized daily activity schedule, the increase in time required to perform necessary tasks is formulated.  Based on the total time loss per day, week, and year, a specific economic valuation of the time loss can then be calculated and claimed as a special damage rather than a general damage,  increasing the probability that the award will be granted.  Severe non-recoverable injuries resulting from work or other accidents sometime create obvious physically restrictive movements.  For example, the loss of a limb or paraplegia from an accident would create obvious change in lifestyle and possible physical activities.  For those cases where the injury was potentially the result of someone else’s negligence, the injured party most likely will seek monetary damages.  Several types of damages are provided in the law.  In general, compensatory damages seek a sum of money to indemnify the person for a particular loss and nothing more.  Most often these losses might be related to loss of earning capacity over the individual’s lifetime.  Compensatory damages may also be related to particular health care expenses that will be incurred over the lifetime of the individual.  The forms of damages that have specific measurable outcomes are known as special damages.  (Ball, 2001).  Another form of compensatory damages are known as general damages.  For example, pain and suffering, mental anguish, and loss of consortium would be classified as general damages.  Since these damages are more abstract, awards for general damages are more difficult to recover.  The loss of time and extra lifetime work for daily activities would fall into this category unless specific measurable values could be generated as a foundation for the claim.  This paper thus presents a methodology for quantifying injury-imposed additional physical work that would logically result as the effect of an injury.  Attaching a specific monetary amount to this extra work and effort (and loss of discretionary time) would then be practical and logically sought as special damages.  (Knight, 1994).  The basic premise is that some injuries also create “additional non-vocational work” activities and/or additional time to complete normal everyday activities.  Examples of the former “additional work activities” would include the time associated with attaching prostheses to limb stumps or bowel programs for paraplegics.  Some further examples of normal non-work activities that would require additional time include opening a can for an arm amputee, getting out of a chair for a leg amputee or entering or exiting buildings for a paraplegic in a wheelchair. In the daily life of a specific injured individual, many everyday activities for daily hygiene, eating, going different places, etc. will mandate a change in approach to a pre-injury state.  For example, envision an individual in a pre-injury state approaching and walking through a closed door.  Then picture an individual confined to a wheelchair also attempting to approach and enter a closed door.  Obviously, the individual in a wheelchair will encounter a more difficult time with this simple activity.  A person with two functioning arms and hands can easily be pictured peeling an apple while the same task for an arm or hand amputee will create special problems, extra work and extra time to complete the task.  These additional non-work activities amount to a loss of discretionary time as compared to normal healthy individuals.  Healthy individuals use non-vocational time to perform certain required tasks each day, e.g., dressing, personal grooming, etc., and then use the remaining time (discretionary time) to engage in personally selected activities.  Such activities might include playing with children, performing civic activities, attending ball games, playing sports or taking trips with the family.    Meanwhile, physically impaired individuals often take longer to perform  daily personal hygiene tasks plus incur additional time to perform a myriad of other commonly necessary physical tasks (such as traveling from one location to another and passing through doors, etc.).  The additional time to perform those tasks diminishes the amount of remaining discretionary time for personal preference activities that existed prior to injury. 


Capital Market Integration

Dr. David Morelli, University of Kent, Canterbury, Kent, UK



US investors looking to invest in European markets will be affected by the extent of integration between the US and European markets.  This paper examines the extent of integration between the capital markets of the US and four of the largest European economies namely, France, Germany, Italy and the UK.  Integration is tested by examining a US-European country multifactor asset pricing model. The results show common risk factors are found to be priced between the US and all four European markets, implying the existence of integration.  Investors are always seeking to achieve the highest return per unit of risk. From the point of view of an US investor, exposure to national systematic risk within the US can be reduced through international diversification by investing in capital markets outside the US. European markets allow investors to benefit from the advantage brought about through international diversification. Clearly, the diversification benefits to US investors investing in European markets depends upon the degree of integration between the US and European markets. Early studies by Gultekin et al. (1989), examining the US and Japan, Korajczyk and Viallet (1989) examining the US, Japan, France and the UK failed to find integration between these markets.  Later studies by Heston et al. (1995) examining Europe and the US, Cheng (1998) examining the UK and US markets, Swanson (2003) examining Japan, Germany and the US, and Morelli (2010) examining the European markets produced evidence in support of capital market integration.  This paper examines whether the US capital market is integrated with the capital markets of the four largest European economies, namely, the UK, Germany, France and Italy.  This question is addressed by testing a US-European country multifactor asset pricing model (1). Common factors are extracted from portfolios consisting of securities from the US and France, US and Germany, US and Italy, US and UK using maximum likelihood factor analysis.   Under such a model a security’s expected return is a function of its sensitivity to US-European country common factors. The approach adopted in this paper to examine capital market integration avoids the indeterminacy problem with factor score estimation thereby contributing to the existing literature that exists in the field of capital market integration  (2).  The data consists of monthly security returns of 200 securities from the US and 200 from each of the four European countries, France, Germany, Italy and the UK, over the period January 1993 to December 2010.  All returns are calculated in US dollars. Analysis is undertaken over the total data period and two sub-periods. Given that three of the European countries adopted the Euro as their currency during this time period, the sub-periods capture the effect of the Euro, if any, on the European markets. The two sub-periods are; January 1993-December 2001, and January 2002-December 2010.  Table 1 reports the mean monthly return and standard deviation expressed as a percentage, along with the skewness, kurtosis and the p-values from the Kolmogorov-Smirnov (K-S) test for normality of the data.  The statistics for each country is based upon a value weighted average of all 200 securities. The US, France and Germany all show negative skewness, though for all countries the kurtosis levels show no evidence to suggest any serious deviation from normal distribution.  This is also supported by the results of the K-S test. The correlations reported in Table 2 across the total time period and both sub periods clearly shows that a relationship exists between the US and the European countries and also between the European countries themselves.  Further analysis of the two sub-periods shows that the returns of all European markets have become more correlated after implementation of the Euro, including the UK which maintained its own separate currency.  where Rt is a 1 x n row vector for n excess security returns at time t, Ft is a 1 x K row vector of common factors at time t, the factors representing common factors extracted from a portfolio consisting of US and the European country securities, b is a n x K matrix of coefficients (factor loadings) on the K factors for each of the n securities, et is a n x 1 column vector of idiosyncratic terms for each security at time t.  The US-European country multifactor asset pricing model given by equation (1) is tested for US-France, US-Germany, US-Italy and US-UK. To examine the extent of integration between the US and each of the European countries using the US-European country multifactor asset pricing model shown by Equation (1), 4 portfolios are formed; US-France, US-Germany, US-Italy and US-UK portfolios, each consisting of a total of 400 securities made up of 200 US securities and 200 securities from the corresponding European country. Thus all securities are used in forming the portfolios.  In order to extract common factors, common to both the US and the European country, from each of these 4 portfolios, maximum likelihood factor analysis (see Lawley and Maxwell (1971) is used.


The Impact of Control Variables on the Interrelation between Passenger Loyalty Programs and Airline Customer Retention

Mark Wever, University of Latvia, Riga, Latvia



The influence of frequent flyer programs on customer retention in the airline industry demands further research. While previous studies indicate that airline loyalty is positively affected by frequent flyer programs, air flight ticket prices, national carrier status and perceived reputation (Dolnicar, Grabler, Grün, & Kulnig, 2011, p. 1020), the influence of loyalty programs on customer behavior can prove to be limited in its short- and long-term effectiveness among frequent service users, even though these programs can increase brand patronage levels, especially for low frequency service users (Liu, 2007, p. 19). Despite the widely held theoretical assumption that customer loyalty programs significantly affect consumer behavior, the empirical evidence demonstrating the effectiveness of loyalty programs is relatively scarce, contradictory and inconsistent (Bolton, Lemon, & Verhoef, 2004, p. 271). Insufficient research exists concerning customer behavior vis-à-vis alternative choices, such as between competing service providers (Meyer-Waarden, 2008, p. 88). The existence of loyalty programs at both low cost and full service carriers makes it important to pay research attention to the factors that affect customer retention in the process of decision making in the airline industry. Nonetheless, customer loyalty and frequency reward programs have long been recognized as important drivers of customer retention and purchase likelihood. Especially with respect to customer loyalty, statistical modeling results have shown that the impact of frequent flyer programs on airline choice is complexly related to other factors across different market segments. Therefore, customer loyalty programs, such as frequent flyer programs, may be expected to affect airline choice, due to the impact of attitudinal variables, given that these programs enable airlines to establish long-term relations with their customers. However, there is mixed empirical evidence that customer loyalty schemes have a significant impact on consumer behavior. Prior studies also indicate that airline choice factors significantly differ depending on the market segment that airline passengers belong to. Thus, this paper demonstrates that additional research is necessary, in order to examine the effect of loyalty programs on customer retention and loyalty across both full service carriers and low cost airlines.  While previous studies indicate that airline loyalty is positively affected by frequent flyer programs, air flight ticket prices, national carrier status and perceived reputation, in particular consumer market segments, such as business or leisure travelers, only some of these loyalty factors are likely to play a significant role (Dolnicar, Grabler, Grün, & Kulnig, 2011, p. 1020). Given the growing presence of low cost carriers in the air flight market, airline customers may increasingly switch their loyalty to these carriers, although this trend holds less for business passengers. However, as findings for the Asian market show, across all market segments convenient booking interfaces, frequent flyer programs and cheaper air fares can have a positive effect on airline loyalty, whereas in-flight safety concerns and negative airline image can decrease the probability that airlines will retain their customers (Chang & Hung, 2013, p. 29). In this respect, the air flight market is likely to be similar to other market sectors, where loyalty programs significantly decrease the likelihood that customer will switch between service providers. Thus, customer loyalty programs can be expected to have a significantly positive impact on customer retention irrespective of the impact of other factors on customer behavior (Meyer-Waarden, 2008, p. 87). At the same time, the impact of these other factors, such as consumer perceptions regarding airline quality, can significantly differ according to the market where they are measured. As exploratory studies indicate, while consumer perceptions of airline service quality tend to be lower than actual airline performance, for European customers air flight on-time arrival are likely to play a significantly less important role in the formation of their dispositions toward international airlines than for customers from the United States (Tiernan, Rhoades, & Waguespack Jr, 2008, p. 212). Furthermore, in particular subsectors of the air travel consumer market, such as among business travelers, frequent flyer programs are closely associated with social status, which indicates that the effect of frequent flyer benefits and rewards is likely to be influenced by their perceptions in different customer groups (Gössling, & Nilsson, 2010, p. 241).  Thus, the influence of frequent flyer programs on customer retention in the airline industry demands further research. While these customer loyalty programs are in wide use in the airline industry, due to their effect on perceived service quality and airline selection, whether these programs can bestow durable competitive advantage remains debatable, due to their associated costs and uncertain added value (Martín, Román, & Espino, 2011, p. 364). Similarly, studies on customer loyalty programs indicate that, despite their popularity, these programs do not have an unequivocal effect on customer behavior, which is likely to limit their effectiveness. Furthermore, the influence of loyalty programs on customer choices can be expected to be moderated and mediated by additional factors. Although loyalty programs can reinforce customer preferences in the long term, their impact is likely to significantly differ across various market segments and geographical regions (Dorotic, Bijmolt, & Verhoef, 2012, p. 217).  In other words, the influence of loyalty programs on customer behavior can prove to be limited in its short- and long-term effectiveness among frequent service users, even though these programs can increase brand patronage levels, especially for low frequency service users (Liu, 2007, p. 19). Furthermore, customer loyalty is likely to be significantly affected by switching costs, brand involvement and perceived benefits as interrelated factors that can be expected to exert a moderating influence on the interrelationship between customer retention and other variables (Dagger, & David, 2012, p. 447).


New Life For Old Theories – Integrating Management Theories Within A Meta-Model

Dr. David A Robinson, RMIT Asia Graduate Centre, RMIT University, Vietnam

Dr. W. Arthur Morgan, RMIT Asia Graduate Centre, RMIT University, Vietnam

Dr. Trung Quang Nguyen, RMIT Asia Graduate Centre, RMIT University, Vietnam



Some management theories never die, they just get old and lose their faculties often becoming distorted by the increasing number of ways and contexts in which they are explored. It is a truism that some management theories do not stand the test of time and in so doing are destined to be nothing more than a passing fad and quite rightly should be allowed to pass away quietly. It is not unknown for the proponent of a particular ‘hot’ theory to make considerable financial gains from the sale of books, guest lectures and the production and sale of self-help paperbacks of the type often found in airport bookstores and as such it might be argued they bring the common man into contact with theories that as a matter of a daily lived organisational life they would never have encountered otherwise.  This paper seeks firstly to establish the difference between a ‘fad’ and a ‘theory’ and then poses the questions: Can some management theories be combined to form a meta-model, thereby providing a firm foundation for the building of an effective business?  A management theory has been described as a “collection of ideas which set forth general rules on how to manage a business or organization (Business Directory; online, n.d.). Typically, a management theory is aimed at helping managers to understand organizational dynamics, particularly to motivate employees to achieve goals. In contrast, a fad is described as ‘a desirable trend characterized with lots of enthusiasm and energy over a short period of time (Business Directory; online, n.d.).  A meta-theory has been defined as a theory concerned with the investigation, analysis, or description of theory itself (Webster; online, nd). In this paper the term meta-model is used in the sense of providing a model that combines and embraces established models or theories to facilitate a deeper, richer application of each in its own right. Transferring a theory from one field of study to a different field of study often provides fresh impetus and the theory becomes re-energised as a result. It does not change the underlying principles however it may be explored in different contexts and settings and in so doing offer insights that may not have been available previously. In this paper we will revisit three significant management theories. They are significant in that they are utilised to explain or least partially understand human dynamics and the way in which people behave, particularly in a workplace or organisation-based setting. The four management theories are: .Maslow’s Hierarchy of Needs, Motivation Theory (as popularized by Herzberg and McGregor), Form-Storm-Norm-Perform (Tuckman, 1960), and Team Roles (Belbin, 1986). Most readers are likely to have encountered all of these at some time past, so the briefest of summaries is apt here.  Maslow’s hierarchy of needs states that all persons are motivated by need-fulfilment and that needs exist hierarchically in a way that when one set of needs is met the next higher level of need kicks in. Maslow identified five levels and named them physiological needs, safety needs, social needs, esteem needs and self-actualization needs. The lower the level, the more people trying to satisfy the need, therefore the model is depicted as a pyramid (see figure 1).  The model assumes that needs fulfilment takes place in a hierarchical manner, starting from the lowest level of the pyramid. If a band needs remain unfulfilled, a person is limited from progressing to the next level. We do know, however, that although individuals may display characteristics which might associate with the levels, in truth we may experience all or combinations of these in a short space of time depending on how we might be reacting to a particular set of events. Furthermore, it is not unknown for individuals to self-actualise through their work or other forms of social standings whilst experiencing significant physiological challenges. Herzberg determined that people can be negatively motivated (to produce less) by the absence of hygiene factors, but positively motivated (to produce more) by five motivating factors, namely job satisfaction arising from stimulating work, status and recognition, advancement and promotional opportunity, personal growth and development, and a sense of personal achievement. Most notably money per se was found to be more of a hygiene factor than a motivator. This presents something of a dichotomy. It is not the presence of money per se that is a motivator rather it is the absence of money which may be a demotivator. Other hygiene factors include administration policies and procedures, supervision, job security, and working conditions. A key feature of Herzberg’s motivation theory is the implications might be for an individual’s  motivation over time.  In this regard, McGregor identified two types of people, calling then X and Y, where the X group is inherently negatively charged (to produce as little as possible) and the Y group is inherently positively-charged (to produce as much as possible). Punishments are required to sustain productivity from Xs while rewards can keep Ys producing more and more. This positioning gave rise the idea of ‘carrot’ and ‘stick’ styles of management. McGregor’s so-called Theory X and Y were later complemented by a third set, known as Theory Z (Ouchi, 1981) which includes people who were found to be highly motivated and capable of sustained self-motivation. A key motivator for Zs is believed to be a sense of self-empowerment. It is clear that the presence of Herzberg’s so-called hygiene factors alone does little to motivate performance without the addition of his motivators and conversely the de-motivators. Additionally, by integrating McGregor’s theories on the same graph, it is clear that the motivating factors can have different effects on performance depending upon the inherent orientation that the of individual may haves towards work.  It can be noted, even at this point, that fusing these into one model already an example of a meta-model. Figure 2 also indicates the effects of each of the motivation orientations over time.  Team effectiveness is known to develop through four stages, popularized by Tuckman (1960) as the Form, Storm, Norm, and Perform stages. During the forming stage, team members are likely to be reticent to act (being unsure of each other). This initial phase must be broken and it frequently is when one or more members try to assert themselves, often pulling in opposing directions. The so-called storming stage, far from being destructive, is actually a necessary evil in the life-cycle of a team, as it is here that the prospect of creative conflict or synergy is first encountered as team members get a chance become aware of each one’s respective strengths and weaknesses. During the subsequent norming stage, there is a return to relative calm whilst roles and processes are agreed, which is followed logically by the performing stage in which the team achieves the desired objective.


A Study on Skills Development and Employment Support  Policies for Multi-culture Family in Korea:  Focused on Married Female Immigrants

Dr. Namchul Lee, Korea Research Institute for Vocational Education & Training, Korea



This paper has been written to analyze the current status of economic activities, and to suggest improvement plans and policy tasks for skills development and employment for married female immigrants in Korea. A range of methodologies was adopted to fulfill the purposes of the study, including a literature survey, an analysis of related material, experts’ conferences, an interview survey, and a policy forum.  Various policy implications for skills development and employment support policies for married female immigrants in Korea are discussed. These include policy reform for the stable resettlement of married female immigrants, reinforced support for vocational training and job creation, reinforcement of elementary workplace culture education for adjustment to working life, start-up assistance for multicultural families and personalized start-up education courses for married female immigrants, reinforcement of ties with related organizations to support vocational training and job creation, active employment guidance, support for job-seeking activities and follow-up management after employment (End). As Korea's population becomes more multicultural with a steady influx of foreigners, Korean society is facing the prospect of becoming more ethnically diverse. Foreigners account for just 3.1 percent of the population in Korea in 2016 but the number of foreigners residing in Korea is soaring every year. The foreign resident population of 540,000 in 2006 became 1.74 million in 2015, a 322 percent increase (Ministry of Security and Public, 2015). Forty-two percent of those who have migrated to Korea to get a job are women from developing Asian countries. This is now the most dynamic form of permanent migration to Korea. Half the permanent migration to Korea in recent years has been due to marriage. In 2007, Korea’s Multicultural Families Support Act came into force and led to the opening of multicultural centers around the country. The centers aimed to provide a range of classes and services for migrant women and their families. The country has seen 50 such centers set up on an annual basis since 2007. In the past eight years, 217 centers have been opened under the Gender Equality Ministry. The budget for multicultural families has ballooned to $120 million, a 20-fold increase. The centers appear more focused on delivering esoteric sounding services for migrant women, such as the family integrated education service, and supporting job training. Starting with the “Support measures for the social integration of the married female-immigrants family” in 2006, Korean multicultural policy prepared a legal and institutional basis through legislation of the “Multicultural Family Support Act” in March 2008. This has provided customized services based on the settlement stage and life cycle of multicultural families by expanding service delivery systems nationwide.  As a result, Korean multicultural policy is credited with helping the stable marital life of multicultural families, and has contributed to their economic participation and improved their Korean language skills. The study was conducted to analyze the current status of economic activities, and to suggest improvement plans and policy tasks for skills development and employment for married female immigrants. Firstly, employment characteristics and propensities are identified by analyzing increasing trends in marriage immigration and the economic activities of these immigrants, based on social change, in endeavoring to upgrade their economic status.  Secondly, support measures and lessons are suggested to improve employment effectiveness by analyzing the current situation of labor market policies and programs for married female immigrants. Thirdly, demand-centered skills development policies are prepared by analyzing the current situation of skills development, and programs for married female immigrants. The study also offers a practical basis for job creation and vocational education and training, not only for government and vocational education and training institutes, but also for married female immigrants. Ultimately, this study seeks to contribute to the economic stability of married female immigrants. A number of methodologies were adopted to fulfill the purpose of the study. These include a literature survey, an analysis of related material, experts’ conferences, an interview survey, and a policy forum.  A review of related theories is conducted in Chapter II, which includes a definition of terminologies and multicultural family laws and regulations, and an analysis of preceding studies. Several characteristics of married female immigrants are analyzed in terms of demographic sociology, the economic activities of their spouses, and the employment situations of married female immigrants. The chapter also contains an analysis of the population, social, and economic characteristics of married female immigrants.  Chapter III focuses on an analysis of skills development and employment support policies for married female immigrants. It includes labor market policies for married female immigrants and the performance records of the Seoul Metropolitan Government.  Chapter IV comprises an analysis of the current state of skills development and employment support policies and associated issues. In-depth interviews have been conducted on points related to this study with selected data from results of a national survey by the government (Ministry of Gender Equality and Family). This methodology is replaced by the analysis of current conditions and problems because there are time limits on covering all the subjects, and research areas are too broad.  Chapter V discusses various policy implications for skills development and employment support policies for married female immigrants and contains the conclusion.


Examining the Interest Rate Parity between U.S. and Japan

Dr. Joseph Cheng, Lingnan University, Hong Kong

Dr. Abraham Mulugetta, Ithaca College, Ithaca, N.Y



In this paper, the characteristics and the dynamics of the interest rate parity between the U.S. and Japan, as reflected by the Eurodollar and Euroyen futures markets, are examined.  In an efficient market, the interest rate parity residual, as defined by the difference between the Eurodollar rate and the Euroyen rate plus its forward premium, have a theoretical value of zero.  Using daily closing prices for the Eurodollar, Euroyen, and the Japanese yen futures, it is found that the interest rate parity do not hold in absolute term.  Specifically, Japan has a higher rate than the U.S. even after adjusting for the currency return or forward premium.  Such disparity is likely to be due to default risk differential.  Furthermore, it is found that the disparity tends to converge to some normal or equilibrium level rather than moving in a random manner. This implies that even if the interest rate parity does not hold in absolute terms, it still might hold in relative terms over time. It can be inferred that the parity condition may not be true to covered interest arbitrage conditions as capital flow disruptions phenomenon occur as have been witnessed since the Great Recession. The pervasive quantitative easing, interest reductions and expansionary economic stimuli put into effect by Japan and USA to raise economic performance have relatively differing impact on the economic growth of the two economies. In general, it can be argued that the tenuous parity relationships of exchange rates’ determinations that are entertained during normal economic conditions have been tested since the Great Recession. The unfolding global economic environments, the divergent monetary policies of the Fed, ECB and Bank of Japan as well as Brexit are adding to possible distortion in exchange rate determinations. The enhanced volatility of exchange rates triggered by differing economic performances and relatively different economic tools used by different nations should make the determination of equilibrium exchange rates much more difficult. The study by A. Mulugetta, Y. Mulugetta and A. Tessema (2016 ) refuted the parity conditions and confirmed that the changes in exchange rates were more volatile during the Great recession in comparison to the pre- or post- recession periods for industrialized nations. It is also found that the exchange rates were more volatile for emerging nations. At a time of diverse economic performance among advanced nations, some important research questions need to be addressed as new economic challenge has begun to emerge.  Mulugetta el al (2016) had raised several questions addressing the exchange markets disruptions. “Has the QE by industrialized nations and regions, such as the U.S.A., Japan, Switzerland, and Euro Zone, depreciated their currencies and brought the demise of the underpinning of the freely fluctuating exchange rate system?  Has the reverse of stimulus expansion or quantitative easing and prelude of interest rate hike by the Fed triggered exchange control and some other forms of indirect interventions by other nations including emerging economies?  Indeed, interest rates hike and imposition of exchange control have been implemented by several developed and emerging countries like Argentina, Brazil, India, Indonesia, Korea, South Africa and Turkey.  How are the immensely increased balance sheets of central banks of countries, such as the U.S.A., Japan, Eurozone and Switzerland, that have used QE as a tool for economic expansion as well as to fight currency appreciation and/or to induce currency weakness, going to be maintained? Will the Fed expected interest rate increase give pause to many central banks that were using QE to nudge growth in their economy and lower the exchange rates of their currencies?” Would such scenarios usher more speculative carry trades in an era of nonexistent freely fluctuation exchange rates system?  In the same vein, Joeng (2009) stated that the returns on Yen carry trade are consistently positive and the returns are not due to the lower interest rate in Japan when compared to other countries, but due to change in exchange rates. As the value of the Yen started to increase, speculators, such as hedge funds, have tried to unwind their positions repaying in Yen by borrowing U.S. dollars, which among other enhanced the liquidity crisis of early 2008.  Similarly, Ahmed and Zlate (2013) have also found that interest differentials and global risk appetite to have been the main determinants of net private capital inflows.  Classical studies by Froot and Thaler (1990) and Giovannini and Jorion (1987) had found exchange risk premium besides real interest rate difference as determinants of exchange rates movements.  Engel (2016) stated”…A separate puzzle is that high real interest rate countries tend to have currencies that are stronger than can be accounted for by the path of expected real interest differentials under uncovered interest parity.”  Contrary to such observation, in 2015, even though Japanese real interest rates were relatively lower than many other economies, including USA, there was a surge of speculative capital inflows to the Japanese capital markets. Hedge funders and exchange markets’ speculators were anticipating that the Yen will appreciate vis a vis other currencies even as the government of Japan continue with its QE and stimulus fiscal policies.  In general, the enhanced volatility of exchange rates that are triggered by difference in economic performance and relatively different economic tools used by different nations will make the determinations of equilibrium exchange rates among currencies much more difficult. Moreover, given the managed direction of interest rates in Eurozone, Switzerland, Sweden, China and Japan among others in contrast to that of the expected direction of interest rate in U.S., the weakening or demise of cooperated and coordinated action may be looming.  Thus, the December 2015’s action of the Fed to raise interest rate will usher divergent monetary policy that will impinge on relative value of currencies.


Texas Versus the EPA:  The Showdown at the No Way Corral

Dr. Laura Sullivan, Sam Houston State University, TX

Dr. Joey Robertson, Sam Houston State University, TX

Anthony Sullivan, Attorney at Law



In Massachusetts v. EPA the United States Supreme Court held that the EPA had statutory authority to regulate greenhouse gases (“GHG”).(1)   In order to regulate under the Clean Air Act (“CAA”) requires a finding by the EPA that such gases endanger public health or safety (an “endangerment finding”).(2)  But the EPA never properly explained the potential consequences of an endangerment finding for GHG, thus this holding opened up an array of consequences based on what actions were undertaken by the EPA.  Notably, the holding in Massachusetts v. EPA did not compel the EPA to make an endangerment finding for GHG.(3) In fact, the EPA for years took the position that GHG’s were not pollutants and therefore did not endanger public health or safety. The Massachusetts v. EPA Court rejected this conclusion.    But, after the election of Barack Obama as president in 2008, the EPA became much more active and aggressive with regards to environmental issues.  On December 7, 2009, the EPA finalized its finding under the CAA that GHG’s in the atmosphere endanger both the public health and the environment.  This finding has come under much scrutiny.  Previously, endangerment findings were limited to substances that have a direct impact on public health.  But here, the link is much more suspect—GHG’s cause global warming and global warming can have a negative effect on public health.  This new endangerment finding has far-reaching effects, notwithstanding certain politicians’ statements to the contrary.  As a direct result, the EPA has reversed itself on the flexible permitting permit process in Texas (which is described herein).  The State of Texas asserts that this change has a detrimental economic impact and is taking the fight to the EPA. Texas, along with other states, petitioned the EPA to reconsider its finding, especially in light of what came to be known as the “Climategate” scandal, which brought into question the very data that the EPA relied on to make its decision.  But, the EPA refused.  Especially in light of the Climategate scandal and other evidence that carbon dioxide does not endanger public health or safety, the EPA should have at least reconsidered its endangerment finding.  In fact, one prominent scientist has stated, “Carbon dioxide is not a pollutant but a naturally occurring, beneficial trace gas in the atmosphere. For the past few million years, the Earth has existed in a state of relative carbon dioxide starvation compared with earlier periods. There is no empirical evidence that levels double or even triple those of today will be harmful, climatically or otherwise.  As a vital element in plant photosynthesis, carbon dioxide is the basis of the planetary food chain - literally the staff of life. Its increase in the atmosphere leads mainly to the greening of the planet. To label carbon dioxide a “pollutant” is an abuse of language, logic and science.”(4) Unfortunately, the EPA denied the petitions for reconsideration.(5) Once the EPA determined that it was going to regulate GHG tailpipe emissions for new motor vehicles under the CAA, a series of other requirements kicked in. One of these new requirements is that GHG from stationary sources become “subject to regulation” under the CAA’s permitting programs: Title I Prevention of Significant Deterioration (PSD) preconstruction permitting program and the Title V operating permit program. This dispute is interesting on many levels.  The “green” movement is powerful and environmental groups have strong political influence.  But, the decisions that are being made in the name of environmentalism have incredible economic impact.  Those in the green movement are making billions of dollars promoting their cause and their products.  Congress has gone so far as to ban traditional incandescent light bulbs so that the world will be saved.  But the compact florescent light bulbs that the American people are now forced to buy are many time more expensive and, ironically, much more dangerous to the environment when they are disposed of because they contain mercury. But the green movement appears to be based more on political correctness than fact.  Laws are being passed, regulations are being promulgated and even the Supreme Court is making decisions based on “global warming,” which is hotly contested and which the evidence appears to show is non-existent.  Even those in the environmental movement have ceased to use the term “global warming” and are instead using the term “climate change.”  Now, it seem like every time there is a storm, some environmental group attributes it to “climate change.”  But the environmental movement has been deafly silent over the last two winters, which have seen record low temperatures.  Many scientists believe that the earth is not warming at all. This paper discusses the conflict between the EPA and Texas regarding the EPA’s rejection of Texas’ Flexible Permits Program.  First is a discussion of the Tailoring Rule and the basis for the EPA’s ruling that GHGs are pollutants under the CAA.  Also, to help set the background, a discussion of the Massachusetts v. EPA case is included, which allowed for the EPA’s ruling.  Finally, the arguments made by Texas, the EPA and also energy industry groups are discussed and analyzed.  The paper concludes that the courts should rule in favor of Texas and overturn the EPA’s rejection of Texas’ Flexible Permits Program.


Traditional and Emerging Variables Impacting Saudi Arabia’s Marketing

Dr. Maja Zelihic, The Forbes School of Business at Ashford University, CA

Dr. Richard Murphy, Jacksonville University, FL

Dr. Crystal Makowski, University of North Florida, FL

Muhannad Alharbi, Jacksonville University, FL



The authors present an exploratory study on the differences between marketing in the United States and Saudi Arabia. When one compares marketing efforts of any two regions, several variables need to be taken into consideration: cultural, geographic, and consumer need differences. At times, dominant country religious differences are needed to be considered when one deals with the country without of division of “church” and state, including lifestyle and mindset differences. Considering the complexities and several layers of cultural, socio-economic, and lifestyle differences, between the two studied regions, any direct comparison may prove quite challenging. The complications arise since the target consumers of each country are different, in both their demands and expectations; therefore, customized methods must be used to reach the consumers. Different marketing methods stem from differences and uniqueness of each culture. Each of these countries has a unique culture, and different marketing needs to fulfill cultural and lifestyle needs. (Ali, 2009). Different marketing tools ensure that each company achieves various goals and objectives in any given location. Saudi Arabia has specific formal and informal regulations that control the process of marketing in the country. This study aims to discover main differences between marketing efforts of Saudi Arabia in comparison to its US counterpart. The variables impacting Saudi Arabia marketing will be presented and analyzed. Identifying the core marketing differences is of extreme importance as it helps stakeholders of the US companies understand the marketing process and mechanisms within Saudi kingdom ensuring the success of their future ventures. Creation of better understanding promotes more impactful business activities ultimately benefiting both parties. The main variables studying in this article will be governmental control, cultural background and impact of religion on Saudi Arabia’s marketing efforts. The United States and Saudi Arabia have a rich political and economic connection. As per Gause III, the relationship between the two countries is one of the cornerstones of US diplomatic policies in the Middle Eastern region which, “despite their substantial differences in history, culture, and governance, the two countries have agreed on important political and economic issues” (2011, p.7). Despite the shift towards global economy felt in both countries, the marketing approach and mindset of two countries cannot be more different. Saudi Arabia has a strong economy based on its oil production and resources with an unyielding government controlling both private and public sector. Unlike many other countries in the Middle Eastern and North African region, such as, Egypt, Tunisia, Libya, Yemen and Bahrain, Saudi Arabia has massive reserves in the bank estimated at $481 billion in foreign asset “on hand” in 2011at the time that some of the other above mentioned economies were crumbling (Gause III, 2011, p.6). More than 25% of world’s oil reserves are on the Saudi territory, and its capacity for oil production is currently set at 10 million barrels per day, a figure which is likely to rise (Saudi Arabia Profile, 2016). Euromonitor, identified some of the main statistics of Saudi economics, identifying key areas of vulnerability and opportunities. As per Table 1. Saudi has a very stable economic standing. For comparison purposes, US’s GDP growth was at 2.4%, while Saudi’s was 3.6% during at the same period (Sharf, 2015). While US inflation rate is lower, ranging from 0.7%-3% in the same period; Saudi’s unemployment rate is much more comparable to its US counterpart (Current US Inflation Rates: 2006-2016, 2016). At times, Saudi Arabia whose economy is so much tight to the oil prices experiences a slowdown; but “considering substantial external buffers, a fast-growing non-oil sector in particular “ makes Saudi’s economic situation quite stable and promising (Economy, Finance, Trade: Saudi Arabia, 2016, para. 1).  An average Saudi consumer has not experienced much of the economic downturn experienced by the consumers in many other developed countries thanks to its strong economy based on the global demand for oil. This global demand changed the original consumer demand landscape of the Saudi kingdom. As a matter of fact, as per the Euromonitor International, Saudi consumers exhibit “some shopping habits, one evolving to mimic those in Western countries” with younger generation “emulating Western consumer” (2014, para.1). Marketers need to gear their efforts to the younger consumers while respecting some governmental, social, and cultural restrictions ruling Saudi markets. Marketing is the main tool used by a modern organization to attract and keep consumers to its product and/or service line (Haykel, Hegghammer & Lacroix, 2015). Marketing involves the creation of awareness of a particular company’s offering within the general population. Through marketing, the people in society are made aware of what differentiates one company from the other within the same industry. To ensure that the company is successful, marketing must be done appropriately. Marketing process must be fully aligned to company’s goals and objectives accordingly in addition to company’s understanding of the specific needs of the society within which it operates. Every society has different needs and characteristics which may make marketing efforts crossing cultural and geographical boundaries more difficult.


One Should Never Assume: The Limitations of Recovering Attorney’s Fees in Texas

Arfeo Yllana, Thompson Coe Cousins and Irons

Dr. Diana Brown, Sam Houston State University, TX

Dr. Laura Sullivan, Sam Houston State University, TX



Attorney’s fees are a common component of a plaintiff’s damage model in commercial litigation. However, in Texas, litigants may only recover attorney’s fees if specifically provided for by statute or contract.  Recent case law makes it clear that, for years, many Texas attorneys and judges may have misinterpreted a vital provision of the Texas Civil Practice and Remedies Code. Plaintiffs in breach of contract lawsuits governed by Texas law commonly seek attorney’s fees under the Texas Civil Practice and Remedies Code (hereinafter, “Chapter 38”). (Tex. Civ. Prac. Rem. §38.001). A number of Texas statutes authorize recovery of attorney’s fees in lawsuits under specific circumstances, but the text of Chapter 38 offers a “catch all” that seemingly applies to any lawsuit based on the breach of an oral or written contract:  Sec. 38.001.  RECOVERY OF ATTORNEY’S FEES.  A person may recover reasonable attorney’s fees from an individual or corporation, in addition to the amount of a valid claim and costs, if the claim is for: rendered services; performed labor; furnished material; freight or express overcharges; lost or damaged freight or express; killed or injured stock; a sworn account;  or an oral or written contract. Chapter 38 replaced a similar provision in Article 2226 of the Texas Revised Civil Statutes (“Article 2226”) that allowed for recovery of fees against a “person or corporation.” (Tex. Rev. Civ. Stat. Ann. Art 2226, 1979).  The prevailing case law interpreting Chapter 38 and Article 2226 found that recovery of fees did not apply to defendants that were governmental entities, with few exceptions.1  Until recently, most cases involving Chapter 38 assumed that the recovery of fees under Chapter 38 was applicable to limited liability companies (“LLCs”), general partnerships, limited partnerships (“LPs”), and limited liability partnerships (“LLPs”).2  However, none of those cases specifically addressed the issue of the recoverability of statutory attorney’s fees from a defendant under the “individual or corporation” language, because the issue was not presented on appeal.  But recent decisions by federal and state courts call into question whether the Chapter 38 “catch all” applies to LLP, LLC and partnership defendants, or whether the statute strictly authorizes recovery of fees only from individuals and corporations. The issue was addressed in a 1997 federal district court case, Ganz v. Lyons Partnership, L.P., wherein the court found that Chapter 38 did not apply to a limited partnership because it is not an individual or corporation. The issue was also recently raised in state court with the 2014 case Fleming & Assocs., L.L.P. v. Barton, where the Fourteenth Court of Appeals held that the plain language of Chapter 38 did not authorize recovery of fees against a limited partnership. The Supreme Court of Texas has, thus far, declined to hear the case on appeal.  Until such time as the holding in Fleming may be overturned, the applicability of Chapter 38 to entities other than individuals and corporations will remain in doubt.  This uncertainty directly affects the damage exposure of defendants.  Thus, a prudent defendant can leverage this uncertainty to decrease settlement figures or challenge attorney’s fees post-verdict.  As of June 1, 2013, 36% of active Texas business entities were for-profit corporations, 51% were limited liability companies and 13% were limited partnerships. (Wassdorf, 2013).  Accordingly, if Chapter 38 applies only to individuals and corporations, it would exclude 64% of domestic entities from its scope.  Thus, the interpretation of Chapter 38 has far-reaching implications for commercial litigation in Texas.  There are appellate cases upholding awards of attorney's fees against entities which are neither individuals or corporations.  For instance, in Carr v. Austin Forty, the court considers section 38.001 in detail, deciding that an earnest-money letter of credit is indeed an “oral or written contract” under Chapter 38, and holding that the demand was properly presented. (1987). However, neither side raises the issue that defendant, Austin Forty, a California limited partnership, is neither an “individual or corporation” under the statute.  The parties, and the court, all seem to assume that the statute is applicable. Similarly, in Carlyle Real Estate Limited Partnership–X v. Leibman, the court applied the statute to award attorney’s fees against a limited partnership. (1989).  The court cites Chapter 38 and carefully considered whether there was sufficient evidence in the record that the attorney’s fees were reasonable and necessary.  The issue of the limited partnership potentially not qualifying as an “individual or corporation” is not addressed.  The federal court reviewed the application of Chapter 38.001 to a trust defendant in In re Gibbons-Markey. In that 2007 case, the plaintiff prevailed on a breach of contract claim against Texas Medical Liability Trust, the plaintiff's insurer, and was awarded attorney's fees. The defendant, recognizing the issue and raising it on appeal, argued that it was neither an “individual [nor] a corporation” under the statute, rendering the award of attorney’s fees unsupported under the statute. The court ruled that the defendant trust had waived this argument by failing to object at trial.  However, it is noteworthy that the court went on to recognize that if the statute “simply does not provide for an award of attorney's fees against a trust,” then no objection would need to be made at trial by the defendant to prevent such an award. (Gibbons, 2007, p. 277).  However, the court opined that, even if this objection to the award of attorney’s fees had been preserved at trial, pursuant to Texas law, lawsuits against a trust are regarded as also being suits against the trustees of the trust, which in this case was an individual (i.e., the trustees, as individuals, would be subject to Chapter 38.001).  In Apache Corp. v. Dynergy Midstream Services, the court awarded attorney's fees under Chapter 38.001 against a limited liability company.  (2009).   In that case, the court, once again, did not specifically address the scope of the “individual or corporation” statutory language and did not address whether it found the limited liability company to be an “individual,” or a “corporation,” or whether the issue was considered at all, since neither party raised the issue in the trial court or on appeal.  In Ganz, a federal court in the Northern District of Texas addressed the scope of Chapter 38 in a case involving a claim for attorney’s fees against a limited partnership.  The judge in Ganz reviewed prior cases awarding attorney’s fees under Chapter 38 and found that they did not include a discussion of whether Chapter 38 permitted recovery of fees against a limited partnership.  Accordingly, the court gave nominal weight to the prior case law with respect to determining the applicability of Chapter 38 to limited partnerships.  The Ganz court first noted that Chapter 38 differed from Article 2226 in that it authorizes recovery of an attorney’s fees against an “individual or corporation,” whereas Article 2226 authorizes the recovery of fees against a “person or corporation.”  The Court noted that the effect of the change was to specify more clearly the classification of those against whom attorney’s fees may be recovered.  Delving deeper, the Court examined the reviser’s note to Chapter 38, which points out the reason for the change in wording of the statute:


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