SPRING 2015
VOLUME16, NUMBER1

HIGH REGULATION AND LOW CERTAINTY: MARKETING STRATEGY CHALLENGES FOR THE PHARMACEUTICAL INDUSTRY IN CHINA

Sharon V. Thach

The opening of China to foreign pharmaceutical companies created essentially a new market where the “rules of the game” were not previously established for the particular industrial setting. The regulations governing access to prescription drugs, the role of pharmaceuticals in providing funding for hospitals and clinics, and the low oversight of company practices resulted in a system of mutual corruption, high competition, and shifting regulatory and legal formalities. As the movement to open access to pharmaceuticals to non-hospital purveyors and the attention of Chinese authorities to certain industry practices has proceeded, the industry environment has changed significantly. Four possible new competitive models for pharmaceutical companies are evaluated.


https://doi.org/10.51240/jibe.2015.1.1          PDF

DIFFERENCES IN BEHAVIORAL BIASES IN INVESTMENT DECISION MAKING: GENDER AND OCCUPATION PERSPECTIVE

Shailesh Rastogi

Investments and Investment decision making come a long way in last few decades. The practical deviation from the established norms of conventional finance made the people know that the investors’ buying behavior cannot be understood only by conventional finance theories. Studies strongly support the presence of behavioral aspects in the investment decision making process and behavioral finance provides solution to many-aproblems hitherto not answered appropriately by the conventional finance theory. Moreover, it was also propounded that the behavioral biases vary across gender and occupation of the investors. This study provides evidences for the existence of biases and also provides with the evidences that behavioral biases are not affected by the combined categories of gender and occupation.


https://doi.org/10.51240/jibe.2015.1.2          PDF

ASSESSMENT OF CITRUS KEY LIME PRODUCTION SUPPLY, EXPORTS AND DOMESTIC DEMAND IN MEXICO BEFORE AND THROUGH THE THREAT OF CITRUS GREENING (HLB)

Maria Elena Vera Villagran, L. Myriam Sagarnaga Villegas, Jose M. Salas Gonzalez, and Juan A. Leos Rodriguez

This project looks for the relationship among variables influencing Mexican key lime supply and demand in the domestic and US market under the scenario of using a higher quantity of fertilizers as a strategy for responding against the threat of citrus greening (HLB). With the help of domestic and international databases from 2000 to 2012, a simultaneous equations model was built capturing behavioral and technical variables influencing supply and demand. The most important relationships among variables were price of the product and disposable income for the demand and use of fertilizers and exchange rate for the supply. This work gives the insight, from the economic point of view, that building a model including the right key variables will give a sense of the general structure of a market and the changes in stability due to a sanitary threat


https://doi.org/10.51240/jibe.2015.1.3          PDF

COGNITIVE BIAS AND CAPITAL STRUCTURE IN EMERGING MARKETS: EVIDENCE FROM CHINESE LISTED COMPANIES

Kejing Chen, Yanxi Li, Kung'unde Goodluck Marco, and Wenzhang Sun

We study the influence of managerial cognitive bias on corporate debt policy in China. We develop a theoretical model of capital structure that incorporates tax benefits of debt and predicts how managerial cognitive bias can lead to suboptimal capital structure choices. We find that when managerial cognitive bias is severe, the firm tends to choose overly-conservative or overly-aggressive debt levels, and the debt level is unrelated to the tax rate. In contrast, when managerial cognitive bias is mild, the firm responds to the tax benefit of debt and tends to choose a debt level that is positively related to the tax rate. We contribute to the literature by introducing managerial cognitive bias into the decision making process. We study how cognitive bias can affect capital structure decisions by incorporating the prospect theory in developing a capital structure model.


https://doi.org/10.51240/jibe.2015.1.4          PDF

MOTIVATIONS OF CHINESE OUTWARD FOREIGN DIRECT INVESTMENT: AN ORGANIZING FRAMEWORK AND EMPIRICAL INVESTIGATION

Wenyan Yin

This article examines the recent motivations of Chinese outward foreign direct investment (FDI) by introducing a more comprehensive organizing framework. Theoretically, this paper extends Moon and Roehl’s (2001) imbalance theory from the imbalance of firm ownership to locational perspective as an important motivation of MNCs, and finds that such extension can better explain Chinese FDI. This paper also introduces a more comprehensive framework of Chinese FDI motivations, which includes four types of conventional FDI based on ownership or locational advantages and other six types of unconventional FDI. Empirically, this article provides some important proxy variables for FDI motivations and tests hypotheses. The results show that Chinese FDI is driven by conventional types and unconventional types at its early stage of Chinese FDI, which

provides important implications for FDI decisions of firms from China and other countries at similar stage of development. This paper also distinguishes the asset-seeking FDI of scientific and commercial technology, and it finds different patterns of spatial distribution regarding the two motivations.


https://doi.org/10.51240/jibe.2015.1.5          PDF