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by Ho King-hang. / Thesis (M.B.A.)--Chinese University of Hong Kong, 1994. / Includes bibliographical references (leaves 51-53). / ABSTRACT --- p.ii / TABLE OF CONTENT --- p.iii / LIST OF TABLES --- p.v / LIST OF FIGURES --- p.vi / PREFACE --- p.vii / CHAPTER / Chapter I --- INTRODUCTION --- p.1 / Chapter II --- LITERATURE REVIEW --- p.4 / Macroeconomic Variables as State Variables --- p.4 / Stock Returns and Real Activity --- p.5 / Efficient Capital Markets and Real Activity --- p.5 / Innovations in Real Variables --- p.7 / Impact of Real Activity across Different States of Economy --- p.9 / Stock Returns and Money --- p.10 / The Quantity Theory of Money --- p.10 / Wealth Effect and Substitution Effect --- p.12 / "Money Supply Process: Linkage between Stock Returns, Real Activity, and Money" --- p.14 / Stock Returns and Discount Rates --- p.15 / Chapter III --- DATA AND METHODOLOGY --- p.17 / The Data --- p.17 / Statistical Properties of the Data --- p.18 / Research Methodology --- p.20 / Vector Autoregression (VAR) Analysis --- p.20 / Multiple Regression Analysis --- p.24 / Chapter IV --- EMPIRICAL RESULTS --- p.27 / Crosscorrelations --- p.27 / Stock Returns and Real Activity --- p.27 / "Stock Returns, Real Activity, and Money" --- p.28 / "Real Activity, Money, and Discount Rates" --- p.30 / Unit Root Tests --- p.31 / Specification of the VAR Model --- p.35 / Stock Returns and Real Activity --- p.35 / "Stock Returns, Real Activity, and Money" --- p.35 / "Real Activity, Money, and Discount Rates" --- p.39 / Multiple Regression Analysis --- p.43 / Chapter V --- CONCLUDING REMARKS --- p.48 / BIBLIOGRAPHY --- p.51

The objective of my dissertation work was to provide a better understanding of consumer choices related to these two important tradeoffs that consumers are often confronted with in the marketplace. Drawing upon regulatory focus theory, I investigated how consumers choose between price and quality or price and quantity, in each of two essays, thereby shedding light on the role of consumer goals in purchase decisions. In the first essay, I propose that quality is predominantly a promotion feature whereas price is predominantly a prevention feature. Therefore, promotion oriented consumers should be more attentive to differences in product quality whereas prevention oriented consumers should be more attentive to differences in product price. Three studies demonstrate that quality (price) is more strongly associated with a promotion (prevention) orientation, that promotion (prevention) oriented consumers prefer products with higher quality (cheaper prices), and that these preferences are mitigated when consumers do not need to prioritize between price and quality and are mediated by relative attention to quality versus price. In the second essay, I investigate the manner in which consumers' goal orientations affect their preferences for monetary versus nonmonetary promotional offers, such as bonus packs and price discounts. I propose that consumers with a promotion (vs. prevention) orientation are more likely to prefer a bonus pack offer over an economically equivalent price discount offer. Two pretests and one study provide empirical support for this key prediction. I also identify theoretically defensible and managerially actionable boundary conditions for this effect that are related to price levels and product types.

With the increasing popularity of online shopping, various new business models are emerging in this area. A successful example is great discount online shops, which quickly attract the attention from Chinese online shopping customers. In order to avoid the risk perception of customers caused by information asymmetry, and maintain competitiveness, great discount online shops should increase their customers’ trust. In this research, a number of key factors are tested from both sellers’ aspect and customers’ aspect. The finding shows both objective influencing factors, such as security, reputation of the online shop, reputation of the products’ brands, sellers’ service quality, and customers’ cognitive factors, such as perceived usefulness and perceived ease of use, have significant correlation with customers’ trust to great discount online shop. Among them, the objective influencing factors are more influential and have stronger effect on customers’ trust in ability, integrity and benevolence to the online shops. These findings will further shed light on how to build trust with the customers of great discount online shops.

PURPOSE- This paper empirically evaluate the ability among various types of parsimonious equity valuation models in order to ascertain which model represents the value of equity the best and thereby manage to withstand factors causing valuation errors. The more complicated models applied, the more underlying assumptions are needed. The trade-off here, which will be investigated, is if the benefit of using more difficult models outweighs the cost of including the extra assumptions. Further on the empirical research´s results will be compared with the results provided by this previous studies examinating American companies. METHOD- Six valuation models using a discounting valuation method are evaluated; the Present Value of Expected Dividends (PVED), Residual Income Valuation (RIV), Residual Income Valuation Terminal Value Constrained [RIV(TVC)], Abnormal Earning Growth approach (AEG), Abnormal Earning Growth Terminal Value Constrained approach [AEG(TVC)]  and Free Cash Flow to the Firm model (FCFF). The five latter investment models are all based on the first model. FINDINGS- The aim of finding the smallest absolute valuation error in the empirical study is given to PVED, a model including little underlying assumptions and inputs. Hence, the implication of the application of valuation models can be summarized as that there are no clear benefits of applying complex models for Swedish companies, and the trade-off between using more complex models and thereby including more assumptions is not compelling given that the benefit does not exceed the cost. All the earnings methods are all found to be superior to the FCFF model, while the constrained RIV and AEG methods provide higher valuation errors than the unconstrained versions. The superiority of the PVED model is inconsistent with the previous results examining American firms, in which the RIV model is preferred. One of the reasons for the difference is the use of different accounting standards in the counties, and thereby the companies´ capital structure and the inputs used in the investment valuation may be somewhat unlike.

Transportation is important in making supply chain decisions. With the careful consideration of transportation expenses, the performance of each supply chain member, as well as the entire supply chain, could be improved significantly. The purpose of this research is: 1) to explore and identify the various situations that relate to replenishment and transportation activities; and 2) to reveal the strength of the connection between purchase quantity and transportation discounts, and integrate the two discounts to enhance supply-chain coordination. The problem is analyzed and categorized into four representative cases, depending on transportation. To aid the supplier or the carrier to determine the discount that should be offered, in light of the buyer's reaction to that discount, decision models are proposed under three different circumstances. First, assuming a single product, we investigate the quantity discounts from the supplier's perspective, via a noncooperative game-theoretical approach and also a joint decision model. Taking into account the price elasticity of demand, this analysis aids a sole supplier in establishing an all-unit quantity discount policy in light of the buyer's best reaction. The Stackelberg equilibrium and the Pareto-optimal solution set are derived for the noncooperative and joint-decision cases, respectively. Our research indicates that channel efficiency can be improved significantly if the quantity discount decision is made jointly rather than noncooperatively. Moreover, we extend our model in several directions: (a) the product is transported by a private fleet; (b) the buyer may choose to offer her customers a different percentage discount than that she obtained from the supplier; and (c) the case of multiple (heterogeneous) buyers. Numerical examples are employed, here and throughout the thesis, to illustrate the practical applications of the models presented and the sensitivity to model parameters. Secondly, we consider a situation with a family of SKUs for which the supplier will offer a quantity discount, according to the aggregate purchases of the product group. Management of those items is based on the modified periodic policy. From the supplier's point of view, what are the optimal parameters (breakpoint and discount percentage)? For deterministic demand, we discuss the cases in which demand is both constant and price-sensitive. First as a noncooperative Stackelberg game, and then when the two parties make the discount and replenishment decisions jointly, we illustrate the impact of price-sensitivity and joint decision making on the supplier's discount policy. The third approach studies the case in which transportation of the goods by a common carrier (a public, for-hire trucking company) is integrated in the quantity discount decisions. In reality, it is quite difficult for the carrier to determine the proper transportation discount, especially in the case of LTL (less-than-truckload) trucking. This is not only because of the "phantom freight" phenomenon, caused by possible over-declaration of the weight by the shipper, but also due to the fact that the discount relates to both transportation and inventory issues. In this research, we study the problem of coordinating the transportation and quantity discount decisions from the perspectives of the parties who offer the discounts, rather than the ones that take them. By comparison of the noncooperative and cooperative models, we show that cooperation provides better overall results, not only to each party, but also to the entire supply chain. To divide the extra payoffs gained from that cooperation, we further conduct a coalition analysis, based upon the concept of "Shapley Value." A detailed algorithm and numerical examples are provided to illustrate the solution procedure. Finally, the thesis concludes with comprehensive remarks. We summarize the contributions of this thesis, show the overall results obtained here, and present the directions that our research may take in the future.

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The purpose of this essay is to analyze the economic factors behind the supply of children engaged in child prostitution in Thailand. Children are recruited to the sex industry either by parents, adults in their immediacy or choose it themselves. There are several factors that contribute to pushing children towards prostitution. Many of these factors such as credit constraints and mortality are related to poverty, the most quoted of economic factors behind the supply of child prostitution. Associated to poverty is the high discount rate which means that people prioritize present over future consumption. In combination with a lack of alternatives, this makes people engage in risky activities such as prostitution. This also seems to be the case in Thailand.   To analyze the different alternatives faced by children in Thailand, a calculation of present value of life time wages of the alternative activities a child faces was computed. The computation of present value of life time wages of alternative activities of children in the face of different discount rates is in line with economic theory and shows that education confers the highest reward unless the discount rate is extremely high. If education is unavailable, as it is for unregistered children in Thailand, or discount rates are very high, as it can be for very poor families, prostitution will be the occupation with the highest returns. 

Since its debut in 2002 in Taiwan, private placement has become more and more popular for the corporate to collect capital in the market. However, because of its divergent characteristics and loose regulations, it has also aroused a great number of controversies so far. This study concentrates on the companies collecting capital by private placement from 2002 to 2007 and examines if obvious discount or premium on placement price existed in these cases. In addition, the study also examines the correlation between the degree of placement discount (premium) and firm characteristics. Finally, it will also be discussed if placement discount (premium) causes positive or negative effect on cumulative abnormal return of the firms. The empirical results show that on average a premium exists in placement price in Taiwan. As for firms¡¦ characteristics, financial crisis, free cash flow, and times of placement have a positive correlation with the discount (premium) degree. Two out of three intangible variables also show a positive correlation with the discount (premium). degree. Finally, the degree of discount (premium) is not significantly correlated with long-term cumulative abnormal return of private placed firms.

This paper investigates whether the bidding induces the occurrence of herding, and analyses the effects of behavioral factors, information, and fundamental characteristics of real estate on the performance of bank auction. Our sample is from July 2001 to January 2003, the real estate that intermediaries sold was held by bank in Taiwan, including 363 the real estate and the price of bidding under bank auction. We obtain some interesting implication. First of all, we find that herding of bidding not only could explain premium but also discount. After controlling informational factors and fundamental characteristics of real estate, it could not weaken the significance of herding of bidding. For the strategy of the reserve price by the vendor, the higher discount is to encourage bidding actively, which is consistent with the view of Welch (1992). Secondly, we find bidders could easily reduce search cost by observing the bidding of competitors under bank auction, and herding of bidding on the auction process could enhance efficiency of information aggregation. Furthermore, herding of bidding makes the performance of auction different between court and bank. Finally, we overcome the selective bias and find the real estate held by bank had poor performance under court auction; however, the real estate held by court had better performance under bank auction. This implies the mechanism of court auction should be transformed into the open-outcry bidding in order to achieve effective recovery of debt and the policy of reducing losses. Robustness analysis of this study, first of all, for the herd measure that not isolated from informational factors, we find the insignificant effect of behavioral factors on the performance of English mechanism, and auction premium and discount are dominated by the informational factors. Secondly, the choice of the methods about true value of real estate may affect the conditional probability of the herd measure, and make inconsistent conclusions that the effect of behavioral factors on the performance of English mechanism. Whether we choose cluster analysis or regression method to obtain the true value of real estate, the conclusion that the effect of behavioral factors on the performance of English mechanism could be supported, and those can not switch the results of the minimum sum method. Thus, the conclusion that behavioral factors influence the performance of the auction is full of evidences.