Diversification and value-at-risk

A pervasive and puzzling feature of banks’ Value-at-Risk (VaR) is its abnormally high level, which leads to excessive regulatory capital. A possible explanation for the tendency of commercial banks to overstate their VaR is that they incompletely account for the diversification effect among broad risk categories (e.g., equity, interest rate, commodity, credit spread, and foreign exchange). By underestimating the diversification effect, bank’s proprietary VaR models produce overly prudent market risk assessments. In this paper, we examine empirically the validity of this hypothesis using actual VaR data from major US commercial banks. In contrast to the VaR diversification hypothesis, we find that US banks show no sign of systematic underestimation of the diversification effect. In particular, diversification effects used by banks is very close to (and quite often larger than) our empirical diversification estimates. A direct implication of this finding is that individual VaRs for each broad risk category, just like aggregate VaRs, are biased risk assessments.

Reflections, successes and pitfalls of coordinating online discussion forums in a foreign language

The advent of e-learning has seen the adaptation and use of a plethora of educational techniques. Of these, online discussion forums have met with success and been used widely in both undergraduate and postgraduate education. The authors of this paper, having previously used online discussion forums in the postgraduate arena with success, adopted this approach for the design and subsequent delivery of a learning and teaching subject. This learning and teaching subject, however, was part of an international collaboration and designed for nurse academics in another country – Vietnam. With the nursing curriculum in Vietnam currently moving to adopt a competency based approach, two learning and teaching subjects were designed by an Australian university for Vietnamese nurse academics. Subject materials constituted a DVD which arrived by post and access to an online platform. Assessment for the subject included (but was not limited to) mandatory participation in online discussion with the other nurse academics enrolled in the subject. The purpose behind the online discussion was to generate discourse between the Vietnamese nurse academics located across Vietnam. Consequently the online discussions occurred in both Vietnamese and English; the Australian academic moderating the discussion did so in Australia with a Vietnamese translator. For the Australian University delivering this subject the difference between this and past online discussions were twofold: delivery was in a foreign language; and the teaching experience of the Vietnamese nurse teachers was mixed and frequently very limited. This paper will provide a discussion addressing the design of an online learning environment for foreign correspondents, the resources and translation required to maximise the success of the online discussion, the lessons learnt and consequent changes made, as well as the rationale of delivering complex content in a foreign language. While specifically addressing the first iteration of the first learning module designed, this paper will also address subsequent changes made for the second iteration of the first module and comment on their success. While a translator is clearly a key component of success, the elements of simplicity and clarity in hand with supportive online moderation must not be overlooked.

Productivity, Technical and Efficiency Change in Singapore’s Services Sector, 2005 to 2008

The current study was motivated by statements made by the Economic Strategies Committee that Singapore’s recent productivity levels in services were well below countries such as the US, Japan and Hong Kong. Massive employment of foreign workers was cited as the reason for poor productivity levels. To shed more light on Singapore’s falling productivity, a nonparametric Malmquist productivity index was employed which provides measures of productivity change, technical change and efficiency change. The findings reveal that growth in total factor productivity was attributed to technical change with no improvement in efficiency change. Such results suggest that gains from TFP were input-driven rather than from a ‘best-practice’ approach such as improvements in operations or better resource allocation.

Corporate governance, accounting and finance: a review

We review accounting and finance research on corporate governance (CG). In the course of our review, we focus on a particularly vexing issue, namely endogeneity in the relationships between CG and other matters of concern to accounting and finance scholars, and suggest ways to deal with it. Given the advent of large commercial CG databases, we also stress the importance of how CG is measured and in particular, the construction of CG indices, which should be sensitive to local institutional arrangements, and the need to capture both internal and external aspects of governance. The ‘stickiness’ of CG characteristics provides an additional challenge to CG scholars. Better theory is required, for example, to explain whether various CG practices substitute for each other or are complements. While a multidisciplinary approach to developing better theory is never without its difficulties, it could enrich the current body of knowledge in CG. Despite the vastness of the existing CG literature, these issues do suggest a number of avenues for future research.

Distribution trade sector output and productivity performance : a case study of Singapore and Hong Kong 2001-2008

This paper employs the industry of origin approach to compare value added and productivity of Singapore and Hong Kong's Distribution Trade Sector for the period 2001-2008. The direct comparison between these two economies was motivated by the statements of the Singapore government: Its services sector, especially in Retail Trade, lags behind Hong Kong's productivity levels. The results show that since 2005, Singapore's Distribution performance in terms of labour productivity was below Hong Kong's level, which was largely due to poor performance in its Retail Trade sector arising from an influx of foreign workers. Results from total factor productivity (TFP) between these two economies also suggest that Hong Kong's better performance (since 2005) was largely due to its ability to employ more educated and trained workers with limited use of capital. The results suggest that polices that worked in Hong Kong may not work for Singapore because its population is more diverse which poses a challenge to policy-makers in raising its productivity level.

Towards testing the eclectic paradigm on multinational contracting: an approach to reviewing and analysing secondary data

In response to the need to leverage private finance and the lack of competition in some parts of the Australian public sector major infrastructure market, especially in very large economic infrastructure procured using Pubic Private Partnerships, the Australian Federal government has demonstrated its desire to attract new sources of in-bound foreign direct investment (FDI) into the Australian construction market. This paper aims to report on progress towards an investigation into the determinants of multinational contractors’ willingness to bid for Australian public sector major infrastructure projects and which is designed to give an improved understanding of matters surrounding FDI into the Australian construction sector. This research deploys Dunning’s eclectic theory for the first time in terms of in-bound FDI by multinational contractors and as head contractors bidding for Australian major infrastructure public sector projects. Elsewhere, the authors have developed Dunning’s principal hypothesis associated with his eclectic framework in order to suit the context of this research and to address a weakness arising in Dunning’s principal hypothesis that is based on a nominal approach to the factors in the eclectic framework and which fail to speak to the relative explanatory power of these factors. In this paper, an approach to reviewing and analysing secondary data, as part of the first stage investigation in this research, is developed and some illustrations given, vis-à-vis the selected sector (roads, bridges and tunnels) in Australia (as the host location) and using one of the selected home countries (Spain). In conclusion, some tentative thoughts are offered in anticipation of the completion of the first stage investigation - in terms of the extent to which this first stage based on secondary data only might suggest the relative importance of the factors in the eclectic framework. It is noted that more robust conclusions are expected following the future planned stages of the research and these stages including primary data are briefly outlined. Finally, and beyond theoretical contributions expected from the overall approach taken to developing and testing Dunning’s framework, other expected contributions concerning research method and practical implications are mentioned.

Fashion localisation in a global aesthetic market

This paper investigates how fashion circulates globally and is adapted and localised by consumers. The rise of fashion blogs, social networking, on-line retail and on-line streaming of fashion shows has exponentially increased the availability of fashion images globally, enabling a further multiplication of styles and looks. The geographical dispersion of production systems in third world countries, and the concentration of management and finance in first world countries are increasingly acknowledged as having an uneven social and economic effect. However, processes of hibridisation and creolisation give rise to new cultural forms where the local and the foreign are mixed in interesting ways. I argue that the current circulation of fashion must be understood as adaptation in which “outside aesthetic influence is integrated into and becomes part of an existing style tradition” (Lynch and Strauss, 2007, p. 154). This emergence of new local and eclectic styles denies assumptions in which consumers are disengaged while duped by a system of commodification. The paper argues that, through a process of “deterritorialisation”, “displacement” and “repatriation” (Appadurai 1996, p. 32), creative ordinary consumers are able to engage with fashion, reinventing it in the context of their local cultures.

A first stage test of Dunning's framework on multinational contracting into Australia : reviewing secondary data.

In response to the need to leverage private finance and the lack of competition in some parts of the Australian public sector infrastructure market, especially in the very large economic infrastructure sector procured using Pubic Private Partnerships, the Australian Federal government has demonstrated its desire to attract new sources of in-bound foreign direct investment (FDI). This paper aims to report on progress towards an investigation into the determinants of multinational contractors’ willingness to bid for Australian public sector major infrastructure projects. This research deploys Dunning’s eclectic theory for the first time in terms of in-bound FDI by multinational contractors into Australia. Elsewhere, the authors have developed Dunning’s principal hypothesis to suit the context of this research and to address a weakness arising in this hypothesis that is based on a nominal approach to the factors in Dunning's eclectic framework and which fails to speak to the relative explanatory power of these factors. In this paper, a first stage test of the authors' development of Dunning's hypothesis is presented by way of an initial review of secondary data vis-à-vis the selected sector (roads and bridges) in Australia (as the host location) and with respect to four selected home countries (China; Japan; Spain; and US). In doing so, the next stage in the research method concerning sampling and case studies is also further developed and described in this paper. In conclusion, the extent to which the initial review of secondary data suggests the relative importance of the factors in the eclectic framework is considered. It is noted that more robust conclusions are expected following the future planned stages of the research including primary data from the case studies and a global survey of the world’s largest contractors and which is briefly previewed. Finally, and beyond theoretical contributions expected from the overall approach taken to developing and testing Dunning’s framework, other expected contributions concerning research method and practical implications are mentioned.

Productivity, technical and efficiency change in Singapore’s services sector, 2005 to 2008

The current study was motivated by statements made by the Economic Strategies Committee that Singapore’s recent productivity levels in services were well below countries such as the US, Japan and Hong Kong. Massive employment of foreign workers was cited as the reason for poor productivity levels. To shed more light on Singapore’s falling productivity, a nonparametric Malmquist productivity index was employed which provides measures of productivity change, technical change and efficiency change. The findings reveal that growth in Total Factor Productivity (TFP) was attributed to technical change with no improvement in efficiency change. Such results suggest that gains from TFP were input-driven rather than from a ‘best-practice’ approach such as improvements in operations or better resource allocation.

Efficiency and productivity of Singapore’s manufacturing sector 2001-2010: An analysis using Simar and Wilson’s (2007) bootstrapped truncated approach

This paper seeks to explain the lagging productivity in Singapore’s manufacturing noted in the statements of the Economic Strategies Committee Report 2010. Two methods are employed: the Malmquist productivity to measure total factor productivity change and Simar and Wilson’s (J Econ, 136:31–64, 2007) bootstrapped truncated regression approach. In the first stage, the nonparametric data envelopment analysis is used to measure technical efficiency. To quantify the economic drivers underlying inefficiencies, the second stage employs a bootstrapped truncated regression whereby bias-corrected efficiency estimates are regressed against explanatory variables. The findings reveal that growth in total factor productivity was attributed to efficiency change with no technical progress. Most industries were technically inefficient throughout the period except for ‘Pharmaceutical Products’. Sources of efficiency were attributed to quality of worker and flexible work arrangements while incessant use of foreign workers lowered efficiency.

Enhancing foreign language learning through listening strategy delivered in L1: an experimental study

Listening used in language teaching refers to a complex process that allows us to understand spoken language. The current study, conducted in Iran with an experimental design, investigated the effectiveness of teaching listening strategies delivered in L1 (Persian) and its effect on listening comprehension in L2. Five listening strategies: Guessing, making inferences, identifying topics, repetition, and note-taking were taught over 14 weeks during a semester. Sixty lower intermediate female participants came from two EFL classrooms in an English language institute. The experimental class (n = 30) who listened to their classroom activities performed better (t value = 10.083) than the control class using a methodology that led learners through five listening strategies in Persian. The same teacher taught the students in the control class (n = 30), who listened to the same classroom listening activities without any of the above listening strategies. A pre and post listening test made by a group of experts in the language institute assessed the effect of teaching listening strategies delivered in L1. Results gathered on the post intervention listening test revealed that listening strategies delivered in L1 led to a statistically significant improvement in their discrete listening scores compared with the control group.