Gadjah Mada International Journal of Business
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Factors Affecting Choice in A Multi-Stage Model: The Influence of Saliency and Similarity on Retrieval Set and the Implication of Context Effect on Consideration Set
Get PDFWhile it is considered a new paradigm in consumer research, the multi-stage model of consumer decision-making remains unclear as to whether brands are easily retrieved. Likewise, the process of consideration, after particular brands are successfully retrieved, is still in question. This study purports to investigate the effects of saliency and similarity on the ease of retrieval. In addition, referring to some studies of context effect, the effects of attraction, compromise, and assimilation are examined to observe whether they contribute to consideration. A within-subject design is employed in this study. Previously, three preliminary studies are arranged to determine the dominants, new entrants, attributes, and other criteria nominated in the experimental study. The results turn out to be supporting the hypotheses
Psychological Factors and Reference Potential of Market Mavens
Get PDFThe function of a market maven in the information transfer processes is apparently related to one’s psychological states such as inherent knowledge and involvement level. Understanding reference potential of mavens seems to be relevant to comprehend the implicit value of a maven in the communication process. This study shows that (1) apparently, maven groups can be clearly distinguished from a non-maven group on the basis on inherent personal knowledge level and involvement level; (2) market mavens have a high reference potential which confirmed their function in WOM-information
A longitudinal Examination of Environmental Reporting Practices in Malaysia
Get PDFA content analysis of the annual reports of 96 Malaysian companies in 1999, 2003 and 2006 finds that the number of companies reporting on the environment increased from 47 percent in 1999 to 60 percent in 2003, and further increased to 67 percent in 2006. However, the extent of environmental reporting as measured by the number of environmental sentences and disclosure scores (using a self-constructed disclosure index) indicates a low quality of disclosure. Overall, the disclosure is ad-hoc and predisposed towards building a “good corporate citizen” image. The increasing trend, however, is consistent with the prediction of social issue life cycle theory
Performance Implications of Environment-Strategy-Governance Misfit
Get PDFThis study examines the impacts of matching competitive environment, business strategy, and corporate governance structure on firm performance. We predict that in a dynamic environment, firms pursuing a product differentiation strategy will perform better than firms pursuing a strategy of cost leadership, but the performance differential is affected by the level of board independence and managerial share ownership. In a stable environment, we predict that firms pursuing a strategy of cost leadership will perform better than firms pursuing a product differentiation strategy, and the performance differential is affected by the level of board independence and managerial share ownership. Overall, the results are consistent with the predictions of this study. Board independence and managerial ownership affect the performance differential between product differentiators and cost leaders in a dynamic environment. In a stable environment, however, the results are not statistically significant
The Behavior of Opening and Closing Prices Noise and Overreaction
Get PDFThis study extends several previous studies that conclude that noise and overreaction on intraday data occur. Those studies have yet to be clear about the kind of price that explains for this noise and overreaction. This study examines the opening price and closing price behavior, and tries to explain the noise and overreaction on the Indonesia Stock Exchange using intraday data in every 30-minute interval. Sample is firms listed in LQ45 index. Sequentially, this research sample is filtered to stocks that are the most actively traded on the Indonesia Stock Exchange based on trading frequency in an observation period from January to December 2006. This research finds that noise and overreaction phenomena always occur in the opening and closing prices. In addition, investors actually correct the noise and overreaction that occur simultaneously at the first 30-minute interval on every trading day
The Impact of Government Debt Issuance on Short-Term interest rates in Indonesia
Get PDFThis paper analyzes whether the expansionary fiscal policy funded by issuing debt instruments in financial markets will increase short-term interest rates. If the expansionary fiscal policy increases interest rates, which decrease private spending especially investment, crowding out occurs. This is interesting because global economic crisis has encouraged many countries to run large budget deficits to stimulate the economy. Indonesia has also run budget deficit during this crisis and even in years before. The impact of such a policy can be significant because Indonesia’s debt market is still narrow and shallow. Therefore, its capability of absorbing the government debt instruments without influencing the private sector funding is limited. This study tests whether the crowding out occurs in Indonesia using a time series econometric model inspired by Cebula and Cuellar’s model. The Cointegration Regression and Error Correction Model (ECM) are used in this study. Monthly data from April 2000 to December 2008 are used for overnight real interbank call money interest rates, real net government bond issues in trading, real narrow money supply, real rate of one-month Certificate of Bank Indonesia, growth of Gross Domestic Product, and real net international capital flows. This empirical study shows that the crowding out problem occurred in Indonesia during the period. This indicates that financing budget deficit in Indonesia by issuing debt instruments in the financial markets has a negative impact on the private sector
Investigating the Impacts of Customer Satisfaction on Firm Performance
Get PDFThe purpose of this study is to investigate the impact of customer satisfaction on firm performance. We argue that a firm’s financial performance will be positively affected by its ability to satisfy its customers. By satisfying its customers, a firm increases its ability to acquire new customers, retain existing customers, and increase customer profitability. Based on sample of firms listed on the Indonesian Stock Exchange, we hypothesize and find that customer satisfaction is positively and significantly related to firm performance in terms of return on assets and market value of equity. These findings are consistent with the view that customer satisfaction is a leading indicator of financial performance
What Drives the Payment of Higher Merger Premiums?
Get PDFThis study examines whether the premiums paid to targets firms are affected by bidder CEO overconfidence, merger waves, method of payment, industry of merged firms, and capital liquidity. Using merger data for the period spanning from 1991 to 2000, this study finds that CEOs pay less premiums in cash mergers and pay more premiums for mergers undertaken during the year of high capital liquidity. Moreover, the findings also demonstrate that CEOs tend to pay higher merger premiums for mergers that occur during merger waves and in high capital liquidity year. CEOs’ behavior, which is the main variable examined in this study, does not show any significant effect on the premiums paid. This suggests that the effect of CEO overconfidence on the premiums paid may be exaggerated
Market Mavenism: Its Contribution in Building Consumer’s Trust
Get PDFIn globalization era, firms have to deal with multifaceted challenges. Dynamic changes in consumers’ demands and desires, technology, and new knowledge and innovative movement of competitors are some examples of the important tasks to be managed in order to be able to survive in the market. The role of communications and the presence of market maven cannot be ignored because both are salient elements for establishing a firm’s marketing strategy. Market maven has been well defined and studied. However, the participation of market maven in improving a consumer’s knowledge and trust in certain object is unclear. Therefore, this study aims to: (1) investigate the role of inherent personal knowledge in affecting trust, (2) investigate as to whether mavens play a role in improving a recipient’s knowledge level and trust. The authors conducted a study that involved a total of 134 students as respondents. The correlation between subjective knowledge and trust attains a medium level, while objective knowledge is related to trust at a very low level. Trust in the low maven group is the lowest compared to that in medium and high mavens. This study indicates that there are different results in terms of effects of information provided by three different maven groups
Customers’ Perceptions on the Objectives, Characteristics and Selection Criteria of Islamic Bank in Thailand
Get PDFDue to relatively new establishment of islamic bank in Thailand and paucity of empirical research undertaken in the area, this study intends to capture the perceptions of Thai customers towards the objectives and characteristics of the islamic bank. In addition, this study aims to determine the important bank selection criteria as perceived by the customers and the differences in the perceptions of moslem and non-moslem customers were identified. The study surveys a sample of 462 respondents. The empirical findings show that the Thai customers know that the essential characteristic of the islamic bank is interest prohibition. They tend to support the idea that the islamic bank should strive to achieve its social objectives more than the commercial objectives. In addition, the results showed that there are differences between the Thai moslem and non-moslem customers’ preferences toward various bank selection criteria. The moslems highly considered the interest-free saving facilities, while the non-moslems tended to concern more about its reputation and image, and knowledgeable and competent personnel