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Behavioral Business and Behavioral Financial Economics with Applications

A special issue of Sustainability (ISSN 2071-1050). This special issue belongs to the section "Economic and Business Aspects of Sustainability".

Deadline for manuscript submissions: closed (31 December 2020) | Viewed by 100736

Special Issue Editors


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Guest Editor
1. Department of Finance, Fintech & Blockchain Research Center, Big Data Research Center, Asia University, Taichung City 41354, Taiwan
2. Department of Medical Research, China Medical University Hospital, Taichung City 40447, Taiwan
3. Department of Economics and Finance, The Hang Seng University of Hong Kong, Hong Kong, China
Interests: behavioral models; mathematical modeling; econometrics; energy economics; equity analysis; investment theory; risk management; behavioral economics; operational research; decision theory; environmental economics; public health; time series analysis; forecasting
Special Issues, Collections and Topics in MDPI journals

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Guest Editor
Department of Economics, University of Pretoria, South Africa
Interests: monetary theory and policy; business cycles; time series econometrics

Special Issue Information

Dear Colleagues,

Behavioral business and behavioral financial economics play vital roles in many fields in business and finance. This Special Issue focuses on the behavioral business and behavioral financial economics with applications in the area of sustainability.

The scope of the Special issue includes all areas of behaviorial business, economics, and finance that aim to achieve sustainable business, environment, or economic growth. Using individual behavior is essential for developing new business and finance theories and for testing their validity through analyzing empirical real-world data. For example, behavioral business could help form effective business enterprises, international entrepreneurship, generic and competitive strategies, marketing strategies, new product development, etc., whereas behavioral financial economics could help to form effective monetary and fiscal policies and to develop pricing models for financial assets such as equities, bonds, currencies, and derivative securities.

This Special Issue aims to provide policy implications for managers, environmentalists, and government policymakers that could be used for sustainable business development, sustainable environment management, and sustainable economic growth.

This Special Issue aims to consider, but not limited to, the following topics as research issues:

(1) modelling domestic and international carbon emissions prices to ensure environmental sustainability, (2) multivariate modelling of financial returns and volatility of energy and natural resources, (3) use of renewable and non-renewable energy and non-energy sources for sustainable growth and economic development, (4) analyzing behavioral aspects of consumers for green growth and the awareness about the environment and the role they play in reducing environmental degradation, (5) impacts on the environment and sustainability of pricing carbon emissions, and (6) impacts on health and agriculture sector of unsustainable environment.

References:

Bai, Z.D., Liu, H.X., Wong, W.K., 2009. Enhancement of the applicability of Markowitz’s portfolio optimization by utilizing random matrix theory. Mathematical Finance, 19(4), 639-667.

Egozcue, M., Massoni, S., Wong, W.K., Zitikis, R. 2014, Integration–segregation decisions under general value functions: ‘Create your own bundle—choose 1, 2, or all 3! IMA Journal of Management Mathematics 25(1), 57-72.

Guo, X., Jiang, X.J., Wong, W.K. (2017), Stochastic Dominance and Omega Ratio: Measures to Examine Market Efficiency, Arbitrage Opportunity, and Anomaly, Economies 5, no. 4: 38.

Tsendsuren, S., Li, C.S., Peng, S.C., Wong, W.K., 2018. The effects of health status on life insurance holding in 16 European-countries, Sustainability, 10(10), 3454; https://doi.org/10.3390/su10103454

Lam, K., Liu, T.S., Wong, W.K. (2012), A New Pseudo Bayesian Model with Implications to Financial Anomalies and Investors' Behaviors, Journal of Behavioral Finance 13(2), 93-107.

Li, Z., Li, X., Hui, Y.C., Wong, W.K. 2018. Maslow Portfolio Selection for Individuals with Low Financial Sustainability, Sustainability 10(4), 1128; https://doi.org/10.3390/su10041128.

Matsumura, E.M.,Tsui, K.W., Wong, W.K. (1990), An Extended Multinomial-Dirichlet Model for Error Bounds for Dollar-Unit Sampling, Contemporary Accounting Research, 6(2-I), 485-500.

Valenzuela, M.R., Wong, W.K., Zhu, Z.Z. 2019, Sources of inequality in the Philippines: Insights from stochastic dominance tests for richness and poorness, World Economy, https://doi.org/10.1111/twec.12772

Wong, W.K., Lean, H.H., McAleer, M., Tsai, F.-T. 2018, Why are Warrant Markets Sustained in Taiwan but not in China?, Sustainability 10(10), 3748, https://doi.org/10.3390/su10103748.

Wong, W.K., Ma, C., 2008. Preferences over location-scale family. Economic Theory, 37(1), 119-146.

Prof. Dr. Wing-Keung Wong
Prof. Dr. Aviral Kumar Tiwari
Prof. Dr. Rangan Gupta
Guest Editors

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Sustainability is an international peer-reviewed open access semimonthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 2400 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • behavioral business
  • behavioral financial economics
  • sustainability
  • health sector
  • agriculture sector
  • energy resources

Published Papers (23 papers)

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Research

18 pages, 962 KiB  
Article
Sustainability of Global Economic Policy and Stock Market Returns in Indonesia
by Shabir Mohsin Hashmi, Muhammad Akram Gilal and Wing-Keung Wong
Sustainability 2021, 13(10), 5422; https://doi.org/10.3390/su13105422 - 12 May 2021
Cited by 6 | Viewed by 2147
Abstract
Interdependence in trade and financial globalization has increased the vulnerability of developed and developing countries to external shocks alike, whereas emerging markets are more vulnerable to the shocks originating from the world’s leading economies. This paper investigates the impact of the uncertainty from [...] Read more.
Interdependence in trade and financial globalization has increased the vulnerability of developed and developing countries to external shocks alike, whereas emerging markets are more vulnerable to the shocks originating from the world’s leading economies. This paper investigates the impact of the uncertainty from the global economic policy on the return of the Indonesian stock market by using the time-varying correlation based on the rolling window method and time-varying built dynamic conditional correlation method. Both the rolling window and condition correlation estimates indicate that the correlation between global policy uncertainty and Indonesian stock returns is time-varying. The results of the autoregressive distributed lag-based regression indicate that inflation, global crude oil prices, gross domestic product, and world crude oil production have significant impacts on the dynamic conditional correlation. The average negative estimate of time-varying correlation suggests that investors when faced with liquidity constraints in one country may sell off their assets in another country to raise funds in order to meet their future financial needs. This also indicates that the rise in the uncertainty of economic policy in developed markets has a negative impact on the shocks faced by the Indonesian stock market. Based on our empirical findings, it is recommended that Indonesian policymakers should place more focus on the sustainability of the economic growth, pay close attention to volatile crude oil prices, world crude oil production, and inflation so as to avoid dynamic interaction between the uncertainty of economic policy in the developed markets and the return of the Indonesian stock market. Full article
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21 pages, 801 KiB  
Article
Perspective on COVID-19 Pandemic Factors Impacting Organizational Leadership
by James K. C. Chen and Thitima Sriphon
Sustainability 2021, 13(6), 3230; https://doi.org/10.3390/su13063230 - 15 Mar 2021
Cited by 25 | Viewed by 12175
Abstract
Employees are important assets of an organization. Therefore, the employee engagement in teamwork is extremely vital for long-term organizational development. Good managers need excellent leadership skills. However, as the COVID-19 pandemic rapidly spreads around the world, many countries implemented strategies to avoid infection, [...] Read more.
Employees are important assets of an organization. Therefore, the employee engagement in teamwork is extremely vital for long-term organizational development. Good managers need excellent leadership skills. However, as the COVID-19 pandemic rapidly spreads around the world, many countries implemented strategies to avoid infection, such as working from home, isolation of infected people from others, and 14 days of self-quarantine. These strategies impact the trust, communal relationships, and social exchange relationships among organizational employees. However, communal and social exchange relationships are necessary for organizational leadership, and they are considered as the basis of social networks. The trust, communal relationships, social exchange relationships, and leadership in an organization are an interesting issue, particularly in the COVID-19 time, since the role of leaders is very crucial for maintaining organizational sustainability. The main objective of this study is to investigate the impact of COVID-19 on leadership in organizations based on trust, communal relationships, and social exchange relationships. The study employed correlation analysis to explore the interrelationships between variables. The 220 samples collected consisted of basic, middle, and high managers of organizations. The findings show that COVID-19 impacted organizational leadership. COVID-19 (F1) and (F2) factors integrated with each variable: (1) trust, (2) communal relationships, and (3) social exchange relationships created a stronger relationship between trust and leadership, communal relationships and leadership, and also social exchange relationship and leadership in organizations. On the contrary, Covid-19 (F3) factors integrated with each variable: (1) trust, (2) communal relationships, and (3) social exchange relationships decreased a relationship between trust and leadership, communal relationships and leadership, and also social exchange relationships and leadership in organizations. These results can help CEOs in organizations to perceive what factors have a positive impact or a negative impact on leadership in organizations in order to improve their leadership skills, even post COVID-19. The managerial implications are that (1) leaders need good communication skills to share true information with empathy and optimism and (2) leaders need to be thoughtful and capable to handle change in uncertain situations ethically. Full article
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18 pages, 681 KiB  
Article
Sustainability of the Moderating Role of Financial Development in the Determinants of Environmental Degradation: Evidence from Turkey
by Husam Rjoub, Jamiu Adetola Odugbesan, Tomiwa Sunday Adebayo and Wing-Keung Wong
Sustainability 2021, 13(4), 1844; https://doi.org/10.3390/su13041844 - 08 Feb 2021
Cited by 109 | Viewed by 5318
Abstract
One of the questions that remain unanswered in the literature on determinants of carbon emissions is the moderating effect of “financial development”. This becomes imperative, owing to the connection of carbon emissions to environmental degradation, which is considered to be one of the [...] Read more.
One of the questions that remain unanswered in the literature on determinants of carbon emissions is the moderating effect of “financial development”. This becomes imperative, owing to the connection of carbon emissions to environmental degradation, which is considered to be one of the main challenges to sustainable development. Thus, this study investigated the moderating role of financial development in the determinants of carbon emissions for Turkey during the period of 1960 to 2016. Zivot–Andrew and Lee–Strazicich “unit root tests” were utilized to investigate the stationarity properties of the series. The cointegration among the variables employed was examined by utilizing the ARDL bounds test and Bayer–Hanck cointegration test. In contrast, the long-run causal relationship of the variables with carbon emissions was examined by using fully modified ordinary least square (FMOLS), dynamic OLS (DOLS), and Canonical Cointegrating Regression (CCR). The empirical findings reveal the significance of “economic growth”, “capital formation”, “energy consumption”, “urbanization”, and “financial development” as determinants of environmental degradation in Turkey. The study also found the significant moderating role of “financial development” in the relationship between “economic growth” and carbon emissions, capital formation and carbon emissions, and urbanization and carbon emissions. The environmental–financial related policies were suggested for the policymakers in Turkey to aid the reduction of carbon emission with the view of improving environmental quality. Full article
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15 pages, 274 KiB  
Article
Robo-Advising Risk Profiling through Content Analysis for Sustainable Development in the Hong Kong Financial Market
by Mike K. P. So
Sustainability 2021, 13(3), 1306; https://doi.org/10.3390/su13031306 - 27 Jan 2021
Cited by 14 | Viewed by 5250
Abstract
Nowadays, we mainly depend on financial consultants or advisors to conduct risk assessments for individual investors before providing them with any investment advice or recommendations. Individual investors should understand the risk level of their investment choices and their investment decisions should match their [...] Read more.
Nowadays, we mainly depend on financial consultants or advisors to conduct risk assessments for individual investors before providing them with any investment advice or recommendations. Individual investors should understand the risk level of their investment choices and their investment decisions should match their risk profile. This process is usually conducted in face-to-face meetings. However, during the recent coronavirus disease 2019 pandemic, which has seriously impacted daily life with social distancing, in order to maintain sustainability, contact-free advising, such as robo-advising, becomes more important. The aim of this paper was to assess customers’ risk in regards to investment and identify important risk factors needed to profile individual risk preferences, in order to prepare for robo-advising. Inductive content analysis is applied to classify 180 questions from 20 risk assessment questionnaires, sourced from banks and investment service providers, into different types. Then, the number of types is reduced by collapsing similar areas into broader higher order categories (the important risk factors). This paper also makes specific recommendations for the implementation of risk profiling in robo-advising. Full article
21 pages, 4512 KiB  
Article
Sustainability and Waste Imports in China: Pollution Haven or Resources Hunting
by Bowen Li, Antonio Alleyne, Zhaoyong Zhang and Yifei Mu
Sustainability 2021, 13(2), 932; https://doi.org/10.3390/su13020932 - 18 Jan 2021
Cited by 7 | Viewed by 2518
Abstract
Motivations behind a country’s importation of waste are categorized into the pollution haven hypothesis (PHH) and the resource hunting hypothesis (RHH). The importation of wastes can lead to environmental sustainability concerns, requiring governments to intervene when the market fails to reduce the negative [...] Read more.
Motivations behind a country’s importation of waste are categorized into the pollution haven hypothesis (PHH) and the resource hunting hypothesis (RHH). The importation of wastes can lead to environmental sustainability concerns, requiring governments to intervene when the market fails to reduce the negative externalities by strengthening and implementing environmental regulations. Motivated by China’s position within a rapidly growing but environmentally damaging sector of trade, this paper has three goals: (1) to classify the primary hypothesis that governs China’s flow of traded wastes; (2) to verify the heterogeneous impact of the pollution paradise motivation and resource demand motivation of waste imports from developed and developing countries, and across industries; (3) to assess the impact of domestic environmental regulations on the motives behind China’s waste imports. Using 28 imported waste-varieties from 20 of China’s major trade partners across 24 years, findings indicate that the flow of Chinese waste imports is relatively unresponsive under the pollution haven effect. However, the resource hunting effect from developing countries is significantly greater than what originates from developed countries, despite the laws of 2011 and 2017 established to restrict resource hunting activities. These results have important implications for improving the efficiency of China’s waste sorting and recycling systems. Full article
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18 pages, 904 KiB  
Article
Natural Resources and Foreign Direct Investment in Africa: Evidence from Chinese Firms
by Yan Chen, Ruirui Zhai and Kevin H. Zhang
Sustainability 2020, 12(22), 9616; https://doi.org/10.3390/su12229616 - 18 Nov 2020
Cited by 6 | Viewed by 4328
Abstract
The rise of China’s outward foreign direct investment (OFDI) in Africa has promoted the continent’s economic growth but generated controversy in the West. What drives Chinese investment in the continent with abundant natural resources but poor institutions/governance? While the topic is important, studies [...] Read more.
The rise of China’s outward foreign direct investment (OFDI) in Africa has promoted the continent’s economic growth but generated controversy in the West. What drives Chinese investment in the continent with abundant natural resources but poor institutions/governance? While the topic is important, studies on the issue in the literature have been limited. This paper attempts to close the gap by testing hypotheses of the role of resources and institutions with panel data in 2003–2013. Estimates suggest that the Chinese investment is not biased toward resource-rich and institution-poor countries but similar to Western investment, and China’s OFDI is largely profit-driven, just like investors from other countries. Institutional supports from the Chinese government, however, seems to be important to China’s OFDI in Africa. Full article
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19 pages, 655 KiB  
Article
Sustainable Development of Entrepreneurial Orientation through Social Drivers
by Purevdulam Altantsetseg, Alaleh Dadvari, Tsevegjav Munkhdelger, Gerelt-Od Lkhagvasuren and Massoud Moslehpour
Sustainability 2020, 12(21), 8816; https://doi.org/10.3390/su12218816 - 23 Oct 2020
Cited by 7 | Viewed by 2684
Abstract
Given that social dilemmas such as climate change, unemployment, and public health are growing globally, recognition of social drivers related to sustainable development while generating social impact is of particular interest to professionals and academics. This study aims to highlight the antecedents of [...] Read more.
Given that social dilemmas such as climate change, unemployment, and public health are growing globally, recognition of social drivers related to sustainable development while generating social impact is of particular interest to professionals and academics. This study aims to highlight the antecedents of sustainable social impact. Thus, we evaluate the association between entrepreneurial orientation and social impact through the mediation effects of social factors named social drivers, including service innovation, social innovation, and social value orientation. The data collection is from the service and non-service industries in Taiwan. A total of 270 samples consisting of employees, managers, SME owners, and CEOs is used. We employed structural equation modeling (SEM) to test the proposed hypotheses. Research findings indicate entrepreneurial orientation is a determining factor of sustainable innovation that not only renders entrepreneurially strategic dispositions of an organization but also significantly contributes to generating drastic social impact. In particular, entrepreneurs are found to be more proactive in solving problematic social issues through their entrepreneurial characteristics. Statistical findings support that all direct effects, besides partial and full mediation, are proved, which reveals the transformative potential of selected social drivers. Altogether, research findings provide exciting insights into entrepreneurship knowledge, innovation, and value assumptions in the social context. We further discuss theoretical and practical implications. Full article
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25 pages, 738 KiB  
Article
Could Mergers Become More Sustainable? A Study of the Stock Exchange Mergers of NASDAQ and OMX
by Wenjing Xie, João Paulo Vieito, Ephraim Clark and Wing-Keung Wong
Sustainability 2020, 12(20), 8581; https://doi.org/10.3390/su12208581 - 16 Oct 2020
Cited by 3 | Viewed by 2078
Abstract
This study investigates whether the merger of NASDAQ and OMX could reduce the portfolio diversification possibilities for stock market investors and whether it is necessary to implement national policies and international treaties for the sustainable development of financial markets. Our study is very [...] Read more.
This study investigates whether the merger of NASDAQ and OMX could reduce the portfolio diversification possibilities for stock market investors and whether it is necessary to implement national policies and international treaties for the sustainable development of financial markets. Our study is very important because some players in the stock markets have not yet realized that stock exchanges, during the last decades, have moved from government-owned or mutually-owned organizations to private companies, and, with several mergers having occurred, the market is tending gradually to behave like a monopoly. From our analysis, we conclude that increased volatility and reduced diversification opportunities are the results of an increase in the long-run comovement between each pair of indices in Nordic and Baltic stock markets (Denmark, Sweden, Finland, Estonia, Latvia, and Lithuania) and NASDAQ after the merger. We also find that the merger tends to improve the error-correction mechanism for NASDAQ so that it Granger-causes OMX, but OMX loses predictive power on NASDAQ after the merger. We conclude that the merger of NASDAQ and OMX reduces the diversification possibilities for stock market investors and our findings provide evidence to support the argument that it is important to implement national policies and international treaties for the sustainable development of financial markets. Full article
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14 pages, 1034 KiB  
Article
Individual Investors, Average Skewness, and Market Returns
by Jungmu Kim and Yuen Jung Park
Sustainability 2020, 12(20), 8357; https://doi.org/10.3390/su12208357 - 12 Oct 2020
Cited by 1 | Viewed by 2014
Abstract
Understanding individual investors’ short-term behavior toward skewness is essential for the management and investment of corporate social responsibility because the skewness-seeking behavior of individual investors, which causes a bubble in the market, makes the market as a whole more vulnerable, and it is [...] Read more.
Understanding individual investors’ short-term behavior toward skewness is essential for the management and investment of corporate social responsibility because the skewness-seeking behavior of individual investors, which causes a bubble in the market, makes the market as a whole more vulnerable, and it is difficult for the market to be sustainable. In the Korean stock market, we investigated whether average skewness can predict future market returns at the market level and whether the mispricing is associated with demand for the skewness of individual noise traders. Measuring the demand for skewness by the proportion of trading money of individual investors, we found that average skewness negatively predicts future market excess return when the demand for skewness is strong. The result is robust to controlling for market variance as well as other predictors. Our finding indicates that the overall market is overpriced when individual investors excessively trade to seek huge returns in spite of a small probability. Full article
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16 pages, 280 KiB  
Article
Financial Knowledge, Personality Traits, and Risky Borrowing Behaviors in Iranian Households
by Brenda J. Cude, Swarn Chatterjee and Jamal Tavosi
Sustainability 2020, 12(18), 7608; https://doi.org/10.3390/su12187608 - 15 Sep 2020
Cited by 6 | Viewed by 2772
Abstract
This article examines the influence of financial knowledge and personality traits on risky borrowing behaviors among Iranian respondents. A proprietary dataset was used in this study. Logistic regression results indicated that numeracy and knowledge of the time value of money were negatively associated [...] Read more.
This article examines the influence of financial knowledge and personality traits on risky borrowing behaviors among Iranian respondents. A proprietary dataset was used in this study. Logistic regression results indicated that numeracy and knowledge of the time value of money were negatively associated with two of the three risky borrowing behaviors (borrowing more than $1500 USD and use of rent-to-own). Conscientiousness was negatively related to the same two borrowing behaviors. Neuroticism negatively influenced use of payday lending. The article concludes with financial education policy suggestions for Iran and directions for future research. Full article
21 pages, 482 KiB  
Article
Comparative Study of Service Quality on VIP Customer Satisfaction in Internet Banking: South Korea Case
by Sangjae Lee and Kun Chang Lee
Sustainability 2020, 12(16), 6365; https://doi.org/10.3390/su12166365 - 07 Aug 2020
Cited by 7 | Viewed by 5035
Abstract
For Internet banking to compete effectively with traditional brick-and-mortar banking, managers must identify the key determinants of customer satisfaction. While many studies exist on Internet banking, and there is a large base of marketing literature on customers’ perceptions of luxury products, research on [...] Read more.
For Internet banking to compete effectively with traditional brick-and-mortar banking, managers must identify the key determinants of customer satisfaction. While many studies exist on Internet banking, and there is a large base of marketing literature on customers’ perceptions of luxury products, research on the service quality of luxury brands in Internet banking is scarce. Our study investigates service quality that exert influence on customer satisfaction with Internet banking most, along with the moderating role of customer type on the relation between service quality and customer satisfaction. The moderation analysis in our study is the test of difference between general customers and VIP customers which are created according to customer type. Using a web survey of 645 general and VIP (very important person) customers who use Internet banking systems, we examined the effects of fix factors that have an influence on service quality: usefulness, ease of use, and system security, reliability, responsiveness, and empathy. In the full sample, all factors that affect Internet banking quality also affected customer satisfaction significantly. Usefulness, ease of use, and system trust, responsiveness, and empathy are more important in VIP customer satisfaction than in that of general customers, while system security is a more important factor for general than for VIP customers. Our study results indicate that general and VIP customers differently perceive service quality that are relevant to customer satisfaction. Full article
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24 pages, 727 KiB  
Article
Sustainability of Green Tourism among International Tourists and Its Influence on the Achievement of Green Environment: Evidence from North Cyprus
by Samah Ibnou-Laaroussi, Husam Rjoub and Wing-Keung Wong
Sustainability 2020, 12(14), 5698; https://doi.org/10.3390/su12145698 - 15 Jul 2020
Cited by 60 | Viewed by 10260
Abstract
Sustainability of green tourism is gaining more attention from different stakeholders due to its environmental benefits. However, empirical studies on the behavioral aspect of the tourists towards sustainability of green tourism and its influence on the achievement of the green environment have not [...] Read more.
Sustainability of green tourism is gaining more attention from different stakeholders due to its environmental benefits. However, empirical studies on the behavioral aspect of the tourists towards sustainability of green tourism and its influence on the achievement of the green environment have not been exhaustively researched, most especially in a small island state like North Cyprus. In this paper, we investigate the behavioral aspects of international tourists towards the sustainability of green tourism employing an extended framework of the theory of planned behavior (TPB). A sample of 395 questionnaires was administered to the tourists that lodged at the 20 randomly selected five-star hotels in North Cyprus, while the study model was examined through structural equation modelling (SEM). Our study findings indicated that tourists’ perceptions of the sustainability of green tourism and their environmental concerns had a significantly positive impact on their attitudes. In addition, our results revealed that subjective norms had a significantly negative impact on intentions of the tourists to participate in sustainability of green tourism, while attitude was found to have a significantly positive impact on the tourists’ intentions to participate in the sustainability of green tourism. Moreover, we found that both environmental concerns and the intention of the tourists to participate in the sustainability of green tourism had a significantly positive impact on environmentally responsible tourism behavior. Lastly, our study contributes to enhancing the understanding of the perception of tourists on the green environment as it affects their behavior and subsequent influence on their intention to participate in the sustainability of green tourism with the attendant impact on the achievement of environmental degradation reduction. Full article
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16 pages, 1112 KiB  
Article
The Sustainability of Energy Substitution in the Chinese Electric Power Sector
by Ying Li, Yue Xia, Yang-Che Wu and Wing-Keung Wong
Sustainability 2020, 12(13), 5463; https://doi.org/10.3390/su12135463 - 07 Jul 2020
Cited by 6 | Viewed by 2230
Abstract
The Chinese electric power industry, including its coal industry and other energy industries that are not efficient, contributes to China’s serious energy shortages and environmental contamination. The governing authority considers energy conservation to be one of the most prominent national targets, and has [...] Read more.
The Chinese electric power industry, including its coal industry and other energy industries that are not efficient, contributes to China’s serious energy shortages and environmental contamination. The governing authority considers energy conservation to be one of the most prominent national targets, and has formulated various plans for decarbonizing the power system. Applying the trans-log cost function, this paper examined the trans-log cost function to analyze the potential inter-factor substitution among energy, capital and labor. We also investigated what role human capital played in energy substitution for the electric power sector during the period from 1981 to 2017. Three key results were derived: (1) energy is price-insensitive, (2) there exists large substitution sustainability between both capital and labor with energy, and (3) human capital input not only enhances the extent of energy substitutability with capital and labor but also is a substitute to energy itself. These findings imply that the liberalization of the electric price mechanism is conducive to lessening energy use and augmenting non-energy intensiveness, and that energy conservation technology could become more sustainable by investing more capital in the electricity sector, thereby achieving a capital–energy substitution and a decrease of CO2 emissions. We further suggest that the priority for the Chinese electric power industry should be to attach more importance to increasing human capital input. Full article
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18 pages, 2179 KiB  
Article
How Behavioral Aspects Influence the Sustainable Financial Decisions of Shareholders: An Empirical Study and Proposal for a Relevant Decision-Making Concept
by Mariana Sedliačiková, Patrik Aláč and Mária Moresová
Sustainability 2020, 12(12), 4813; https://doi.org/10.3390/su12124813 - 12 Jun 2020
Cited by 4 | Viewed by 5582
Abstract
Behavioral finance is an area or sub-discipline of behavioral economics that examines the real financial behavior and decision-making of people, including the knowledge of psychology and sociology. The objective of this paper was to identify and investigate the impact of significant cognitive, psychological [...] Read more.
Behavioral finance is an area or sub-discipline of behavioral economics that examines the real financial behavior and decision-making of people, including the knowledge of psychology and sociology. The objective of this paper was to identify and investigate the impact of significant cognitive, psychological and emotional factors affecting the financial decision-making of the shareholders of woodworking and furniture manufacturing and trading enterprises. This could lead to the design of decision-making concepts which take into account not only cognitive but also psychological and emotional factors and their influences on decision-making process, which could positively affect the sustainable development of the aforementioned types of enterprises. The mapping of the addressed issue was carried out by means of an empirical survey in the practice of the Slovak woodworking and furniture manufacturing and trading enterprises in the form of a questionnaire. The results of the survey were evaluated by descriptive, graphical and mathematical-statistical methods. Conclusions and recommendations were formulated based on the identification of key behavioral aspects (knowledge, security, freedom and sadness), the implementation of which could contribute to eliminating negative deviations and errors in the financial decision-making process of shareholders of woodworking and furniture manufacturing and trading enterprises. Full article
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11 pages, 267 KiB  
Article
Investor Happiness and Predictability of the Realized Volatility of Oil Price
by Matteo Bonato, Konstantinos Gkillas, Rangan Gupta and Christian Pierdzioch
Sustainability 2020, 12(10), 4309; https://doi.org/10.3390/su12104309 - 25 May 2020
Cited by 20 | Viewed by 2692
Abstract
We use the the heterogeneous autoregressive realized volatility (HAR-RV) model to analyze both in sample and out-of-sample whether a measure of investor happiness predicts the daily realized volatility of oil-price returns, where we use high-frequency intraday data to measure realized volatility. Full-sample estimates [...] Read more.
We use the the heterogeneous autoregressive realized volatility (HAR-RV) model to analyze both in sample and out-of-sample whether a measure of investor happiness predicts the daily realized volatility of oil-price returns, where we use high-frequency intraday data to measure realized volatility. Full-sample estimates reveal that realized volatility is significantly negatively linked to investor happiness at a short forecast horizon. Similarly, out-of-sample results indicate that investor happiness significantly improves the accuracy of forecasts of realized volatility at a short forecast horizon. Results for a medium and a long forecast horizon are insignificant. We argue that our results shed light on the role played by speculation in oil products and the potential function of oil-related products as a hedge against risks in traditional financial assets. Full article
23 pages, 712 KiB  
Article
Natural Resource Rent and Finance: The Moderation Role of Institutions
by Muhammad Atif Khan, Muhammad Asif Khan, Kishwar Ali, József Popp and Judit Oláh
Sustainability 2020, 12(9), 3897; https://doi.org/10.3390/su12093897 - 10 May 2020
Cited by 42 | Viewed by 4267
Abstract
This study empirically examines the nexuses between the natural resource rent and financial development in the context of the emerging economy of Pakistan, between 1984 and 2018, by subsuming the important role of institutional quality in this context under symmetric, asymmetric, and threshold [...] Read more.
This study empirically examines the nexuses between the natural resource rent and financial development in the context of the emerging economy of Pakistan, between 1984 and 2018, by subsuming the important role of institutional quality in this context under symmetric, asymmetric, and threshold settings. The literature to date provides no evidence on the asymmetric relationship between natural resource rent and financial development, and the moderation role of institutional quality in this connection. We show that natural resource rent negatively influences financial development, whereas institutional quality boosts financial development and positively moderates the relationship in the context of Pakistan. Also, we find a single significant threshold value of 3.097 above which the relationship of resource rent-finance turns nonlinear—as up to this threshold the coefficient is 3.228, which declines slightly to 2.804 above the threshold level. This implies that regulators should maintain at least an institutional quality level of up to 3.097 to experience the most desired financial benefits of the natural resource rent in Pakistan. Moreover, the results corroborate the existence of asymmetries in the relationship between the natural resource rent and financial development. This empirical evidence provides fresh insight for stakeholders regarding ambiguous natural resource rents and financial sector development nexuses and recommends that planning organs in Pakistan and other countries in a similar development cadre should use institutional quality as a tool to avoid the resource curse and view natural resources as a blessing rather than a curse. Full article
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25 pages, 1553 KiB  
Article
Sustainability of Both Pecking Order and Trade-Off Theories in Chinese Manufacturing Firms
by Huu Manh Nguyen, Thi Huong Giang Vuong, Thi Huong Nguyen, Yang-Che Wu and Wing-Keung Wong
Sustainability 2020, 12(9), 3883; https://doi.org/10.3390/su12093883 - 09 May 2020
Cited by 16 | Viewed by 4588
Abstract
Our study investigates Chinese manufacturing firms listed on both the Shanghai and the Shenzhen Stock Exchanges. These firms follow the pecking order or trade-off theories in their capital structure choices. Using panel data from the Taiwan Economic Journal and quantile regression, we construct [...] Read more.
Our study investigates Chinese manufacturing firms listed on both the Shanghai and the Shenzhen Stock Exchanges. These firms follow the pecking order or trade-off theories in their capital structure choices. Using panel data from the Taiwan Economic Journal and quantile regression, we construct three models to compare the two theories. Our first model tests the impact of profitability, tangible asset, firm size, and investment opportunities on leverage; our second model adds the dividend payout ratio to test the robustness of the first model; and our third model tests how leverage, profitability, firm size, and dividend variables affect a firm’s investments. From the results of all the models used in our study, we find a negative relationship between leverage and both profitability and the dividend payout ratio and a positive relationship between leverage and growth in a firm’s investments. We also find a negative relationship between dividends, firm size, and growth in a firm’s investments and a positive relationship between investment capital and profitability. The overall results indicate that the capital structure decisions of Chinese manufacturing firms are best explained by the pecking order theory. Full article
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21 pages, 3511 KiB  
Article
Stochastic Differential Game in the Closed-Loop Supply Chain with Fairness Concern Retailer
by Zongsheng Huang
Sustainability 2020, 12(8), 3289; https://doi.org/10.3390/su12083289 - 17 Apr 2020
Cited by 10 | Viewed by 1931
Abstract
This paper addresses the stochastic used-product return problem in a closed-loop supply chain consisting of one manufacturer and one retailer concerned with fairness. We resolve the equilibrium feedback control strategies with no fairness concern retailer, gap fairness concern retailer, and self-due fairness concern [...] Read more.
This paper addresses the stochastic used-product return problem in a closed-loop supply chain consisting of one manufacturer and one retailer concerned with fairness. We resolve the equilibrium feedback control strategies with no fairness concern retailer, gap fairness concern retailer, and self-due fairness concern retailer. We find only under a specific condition, the feedback Markov equilibrium exists, and the expected return rate would approach to the stable state, regardless of the fairness type the retailer is. The equilibrium prices are decreasing over the return rate, and the equilibrium collecting control strategy is increasing over the return rate. The increasing of stochastic disturbance intensity can be beneficial to the supply chain members. The manufacturer should shift profit to the retailer since the retailer is fairness concern. By the comparison analysis, we find the gap fairness concern retailer is more aggressive, while the self-due fairness concern retailer is more reasonable for both the manufacturer and the retailer. Furthermore, we design a hybrid coordinate contract for the manufacturer to coordinate with the retailer. Full article
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25 pages, 738 KiB  
Article
Organizational Information Security Management for Sustainable Information Systems: An Unethical Employee Information Security Behavior Perspective
by Amanda M. Y. Chu and Mike K. P. So
Sustainability 2020, 12(8), 3163; https://doi.org/10.3390/su12083163 - 14 Apr 2020
Cited by 14 | Viewed by 5893
Abstract
This article examines the occurrences of four types of unethical employee information security behavior—misbehavior in networks/applications, dangerous Web use, omissive security behavior, and poor access control—and their relationships with employees’ information security management efforts to maintain sustainable information systems in the workplace. In [...] Read more.
This article examines the occurrences of four types of unethical employee information security behavior—misbehavior in networks/applications, dangerous Web use, omissive security behavior, and poor access control—and their relationships with employees’ information security management efforts to maintain sustainable information systems in the workplace. In terms of theoretical contributions, this article identifies and develops reliable and valid instruments to measure different types of unethical employee information security behavior. In addition, it investigates factors affecting different types of such behavior and how such behavior can be used to predict employees’ willingness to report information security incidents. In terms of managerial contributions, the article suggests that information security awareness programs and perceived punishment have differential effects on the four types of unethical behavior and that certain types of unethical information security behavior exert negative effects on employees’ willingness to report information security incidents. The findings will help managers to derive better security rules and policies, which are important for business continuity. Full article
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25 pages, 463 KiB  
Article
Does the Mixed-Ownership Reform Affect the Innovation Strategy Choices of Chinese State-Owned Enterprises?
by Chunling Li, Runsen Yuan, Muhammad Asif Khan, Khansa Pervaiz and Xiaoran Sun
Sustainability 2020, 12(7), 2587; https://doi.org/10.3390/su12072587 - 25 Mar 2020
Cited by 20 | Viewed by 4613
Abstract
In recent years, the innovation of state-owned listed enterprises has gained substantial momentum in academic research due to their vital role in sustainable economic development. This article examines and evaluates the influence of mixed-ownership reform on the innovation strategy of Chinese State-Owned Enterprises [...] Read more.
In recent years, the innovation of state-owned listed enterprises has gained substantial momentum in academic research due to their vital role in sustainable economic development. This article examines and evaluates the influence of mixed-ownership reform on the innovation strategy of Chinese State-Owned Enterprises (SOEs) from the two dimensions of ownership structure adjustment and control right allocation. We extend extant research in that: The diversity of mixed shareholders, the depth of mixed equity, and the control of mixed equity can significantly promote the exploratory innovation investment of SOEs. Our study investigates the impact of the shareholding ratio of foreign investors, natural persons, and institutional investors. The empirical results found a significant positive correlation between the increase of the shareholding ratio of institutional investors and the exploratory and exploitative innovation investment. On the other hand, private shareholders’ shareholding ratio has no impact on the innovation strategy choices of SOEs. Specifically, the results proved that the promotion of exploratory innovation investment by mixed-ownership reform is more significant in SOEs controlled by the central government or in competitive industries. To a large extent, this promotion is achieved by improving the proportion of executives with a professional R&D background in SOEs. Full article
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19 pages, 2833 KiB  
Article
Reducing Exchange Rate Risks in International Trade: A Hybrid Forecasting Approach of CEEMDAN and Multilayer LSTM
by Hualing Lin, Qiubi Sun and Sheng-Qun Chen
Sustainability 2020, 12(6), 2451; https://doi.org/10.3390/su12062451 - 20 Mar 2020
Cited by 26 | Viewed by 4619
Abstract
In international trade, it is common practice for multinational companies to use financial market instruments, such as financial derivatives and foreign currency debt, to hedge exchange rate risks. Making accurate predictions and decisions on the direction and magnitude of exchange rate movements is [...] Read more.
In international trade, it is common practice for multinational companies to use financial market instruments, such as financial derivatives and foreign currency debt, to hedge exchange rate risks. Making accurate predictions and decisions on the direction and magnitude of exchange rate movements is a more direct way to reduce exchange rate risks. However, the traditional time series model has many limitations in forecasting exchange rate, which is nonlinear and nonstationary. In this paper, we propose a new hybrid model of complete ensemble empirical mode decomposition (CEEMDAN) based multilayer long short-term memory (MLSTM) networks. It overcomes the shortcomings of the classic methods. CEEMDAN not only solves the mode mixing problem of empirical mode decomposition (EMD), but also solves the residue noise problem which is included in the reconstructed data of ensemble empirical mode decomposition (EEMD) with less computation cost. MLSTM can learning more complex dependences from exchange rate data than the classic model of time series. A lot of experiments have been conducted to measure the performance of the proposed approach among the exchange rates of British pound, the Australian dollar, and the US dollar. In order to get an objective evaluation, we compared the proposed method with several standard approaches or other hybrid models. The experimental results show that the CEEMDAN-based MLSTM (CEEMDAN–MLSTM) goes on better than some state-of-the-art models in terms of several evaluations. Full article
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23 pages, 2324 KiB  
Article
Research on Quality Decisions and Coordination with Reference Effect in Dual-Channel Supply Chain
by Zhou Xideng, Xu Bing, Xie Fei and Li Yu
Sustainability 2020, 12(6), 2296; https://doi.org/10.3390/su12062296 - 15 Mar 2020
Cited by 16 | Viewed by 2899
Abstract
Although supply quality management has been studied extensively, one important marketing phenomenon, that is, reference effect has been rarely considered in dual-channel supply chain quality management literatures. In fact, the quality reference effect is also an important factor which influences consumer purchasing behavior. [...] Read more.
Although supply quality management has been studied extensively, one important marketing phenomenon, that is, reference effect has been rarely considered in dual-channel supply chain quality management literatures. In fact, the quality reference effect is also an important factor which influences consumer purchasing behavior. We aim to explore the influence of the reference effect on the optimal decisions and performance of a dual-channel supply. Thus, we formulate dynamic models that include the product quality reference effect and the service quality reference effect in a dual-channel supply chain system consisting of a manufacturer and a retailer under the different decision-making scenarios. Utilizing differential game theory, optimal decisions are obtained for the product quality and service quality decision under the different decision-making scenarios. In addition, the optimal decisions and profits are compared, then a service cost-sharing coordinating mechanism is proposed and proven to be effective in the supply chain system. The main results show when the initial reference service quality is low, the consumer service quality reference effect is beneficial to the manufacturer. The spillover effect of service quality is not conducive to the retailer and the manufacturer. When the initial reference product quality is low, both online and offline product quality reference effects are beneficial to the retailer and the manufacturer. The stable (or final) reference quality will not be affected by the initial reference quality. The sum of the two members’ profits under decentralized decision making is less than the total profit of the supply chain under centralized decision making. We design a cost-sharing coordinating mechanism to eliminate the double marginal effect. Full article
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14 pages, 619 KiB  
Article
Impacts of Tourism Demand on Retail Property Prices in a Shopping Destination
by Yan Liu, Linchuan Yang and Kwong Wing Chau
Sustainability 2020, 12(4), 1361; https://doi.org/10.3390/su12041361 - 13 Feb 2020
Cited by 11 | Viewed by 2854
Abstract
Understanding the relationship between tourism demand and retail property prices is of great significance to tourist destinations, especially shopping destinations. The increase in tourism demand may alter the implicit prices of certain retail property characteristics (e.g., age and accessibility to transit). This study [...] Read more.
Understanding the relationship between tourism demand and retail property prices is of great significance to tourist destinations, especially shopping destinations. The increase in tourism demand may alter the implicit prices of certain retail property characteristics (e.g., age and accessibility to transit). This study examines how tourism demand (measured by tourist volume) affects retail property prices in the tourist precinct of a shopping destination, namely Hong Kong. The implementation of the policy Individual Visit Scheme (IVS) in 2003 in Hong Kong has substantially increased tourist shoppers from Mainland China, and it is used as a quasi-natural experiment of the increased tourist volume. Spatial and non-spatial hedonic pricing models are developed based on the ground-floor retail property transaction data of Causeway Bay, Hong Kong before and after the IVS (1993–2011). The findings of this study are as follows. (1) Accessibility to transit has a larger positive price effect after the implementation of the IVS. (2) The implicit price of accessibility to accommodation facilities is not significantly altered by the implementation of the IVS. (3) Age has a larger negative price effect after the implementation of the IVS. The first two outcomes are related to the economic concerns of tourist shoppers, while the last can be explained by their hometown experience. Finally, practical implications are discussed. Full article
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