Earticle

The Product Life Cycle Theory developed by Vernon explains the observed patterns of international trade that the Heckscher-Ohlin model fails to explain. In the new product stage, the theory explains, the product is produced and consumed in the invented area, usually developed country, but no export trade occurs. In the maturing stage, mass-production technologies are developed and foreign demand in the developed countries expands but the producer now export the new product to other developed countries. In the standardized product stage, production can move to the developing countries, which then export the product to developed countries. This theory suggests that the new innovation should cause export the product, not the other way around. On the other hand, the traditional trade theory suggests that exports can cause a new innovation through learning by exporting. However, theories do not tell the direction of causality between export and innovation. This paper empirically examines the effects of new product innovation and production procedure innovation on export intensity and export decision for Korea's manufacturing companies using the 2008 and 2010 Korean Innovation Survey data. In estimating the relationship between export intensity and innovation activities as well as that between export decision and innovation, it controls for simultaneity and inconsistency of those variables. Empirical results are summarized as follows. First, the exogeneity hypothesis for export decision, export intensity, and innovation activities is rejected, meaning that estimation by the simple OLS and Probit methods can produce biased results. Thus, an increase in export intensity leads to an increase in innovation activities and the other way around. Second, the internal and external technology innovation activities as an input of innovation are also found to be statistically significant, implying that innovation is main sources of export competitiveness and an important factor to explain firms heterogeneity. Third, the export intensity and firm size are found to have inverse U-shaped relationship. Finally, for all firms, export intensity are positively associated with innovation, implying that the larger the innovation is, the higher the export intensity is. The estimated coefficients of new product innovation are found to be larger than those for production procedure innovation. This implies that government R&D subsidy may have a stronger effect on exports for new product innovation, specially for SMEs.

A new online platform may only charge advertisers to compete with a leading incumbent one that collect fees from its users. When these two platforms compete with asymmetric revenue structures, the result of the competition can be different depending on several factors such as the degrees of users singlehoming, the potential market size, and the price-sensitivity of users charged by the incumbent. It is shown that unless all the users singlehome, the latecomer can overtake the incumbent when the potential market size is large or the price-sensitivity of the user group charged by the incumbent is high. This result is also consistent with the anecdotal evidences in China and the US to a degree. This study first shows that a potential market size can change the winner of the competition between an incumbent platform and a new one with asymmetric revenue structures. When one side tends to join the two platforms at a time, the latter can overtake the former if the market is not mature so that there is a room for its further growth. When Taobao started to compete with eBay China in 2003, the market itself was at an intial stage, so that Taobao could win over eBay China by not charging its sellers. On the other hand, Webstore, a free advertising-based online auction platform in the US, has been far behind eBay since its launch in 2008 was too late to change the winner of the competition. The users’ price-sensitivity also impacts the competition. Unless both buyers and sellers singlehome, if sellers are highly price-sensitive, the latecomer can win over the incumbent even when the potential market size is small. As Barnett et al. (2010) indicate, Chinese online auction sellers could have been unfamiliar with and averse to the idea of paying transaction fees. Unfortunately, eBay China adopted the policy of charging its sellers when it entered the market acquiring the leading local platform EachNet in 2003. Taobao, a small player at that time, did not impose any transaction fees on sellers and so could eventually attract more sellers than eBay China in a few years.

Yet there is a lack of research on how the fit between alliance portfolio strategy and external environments affects on firm performance. Building on the contingency theory and the exploration-exploitation framework, this study systematically examined how alliance portfolio strategy-environment fit affects firm performance. At the same time, we classified industries according to their level of technology (technological intensity) in order to find out the difference in the fit between high-tech industries and low-tech industries. To this end, we adopted a cross-sectional time series feasible generalized least squares (FGLS) regression model to analyze our panel data of 125 Korean local manufacturers that had responded to ‘Survey of Business Activities’ of Statistics Korea as they had engaged in alliances at least 3 years in a row between 2009 and 2014. The key findings are as follows. First, in an uncertain demand environment, firms in high-tech industries benefit more from a higher ratio of exploitation alliances in their alliance portfolio. Second, in an uncertain technological environment, it has been found that firms in high-tech industries benefit more from a higher ratio of exploration alliances in their alliance portfolio. On the other hand, firms in low-tech industries benefit more from a higher ratio of exploitation alliances in their alliance portfolio. Third, in an uncertain competitive environment, firms in high-tech industries benefit more from a higher ratio of exploration alliances. These findings have important implications for literature on the relationship between alliance portfolio strategy and firm performance, as well as for managers.

The objective of this study is to identify the attitudes of customers who are using online stores, considering the current transition of customers’ buying activity from conventional offline stores to online stores. To do this, the factors that may have an impact on customer attitudes toward an online store were selected, which included the reputation of the store, website quality and perceived risk, and then the relationship between the factors was also analyzed. To be more specific, the influence of the reputation of an online store was analyzed in terms of the customers’ attitude, website quality and perceived risk. Moreover, a mediation analysis was performed not only on the effect of website quality and perceived risk related with transaction on the online shopping stores, but also on the mediated effect of multiple mediators: the reputation of the online store-website quality-perceived risk- attitude toward the online store. A survey of 557 subjects who had a purchase experience at an online shopping store was conducted, from June to September, 2016, when people are likely to purchase a product or service with high perceived risk or with high involvement. Respondents were reminded of their purchase experiences from March, three months before the survey, until September, the end of the survey. The survey group was accustomed to using computers and mobile phones. We analyzed attitudes of the respondents who had directly purchased a product for their personal or household use. The findings of this survey are as follows. The reputation of an online store is confirmed to have a positive impact both on the customers’ attitude toward the online store and the website quality. The perceived risk has a negative effect on the attitude toward the online store, while the website quality serves to reduce the perceived risk and has a positive influence on the attitude toward the online store. However, the website quality negatively meditates the impact of the reputation of the online store on the attitude toward store. In addition, the mediating effect between website quality and perceived risk is also verified to have been negative. Based on the findings of this research, companies that want to their online stores and ultimately attain their marketing goal are advised to build the reputation of their online stores, improve their website quality and reduce the risk perceived by customers during a transaction process. This would be an effective method of building and maintaining a positive attitude among customers toward an online store. A limitation of this study is that it is focused only on online purchases, and only four variables are used for the Mediateding analysis, even though there are variables other than the reputation of the online store, website quality and perceived risk and attitude toward the store that are worth considering. Moreover, there was no comparison performed between online and offline purchases, and the customers responses based on the distinctive characteristics of online shopping stores were not analyzed. Future research should considering the following. First, a comparative study between online and offline purchases would provide more useful findings from a practical perspective. Second, more diverse variables that can affect customers’ online purchase should be utilized. Third, customers have preference for various online shopping stores, and have used different online shopping stores. Therefore, if a comparative study between these stores were performed, it would provide more useful findings, from practical and academic perspective. Lastly, customers use an online shopping store and demand different levels of service depending on the characteristics of a product or service (involvement, etc.). Therefore, the products and services that customers purchase should be also be studied in the future by subdividing their characteristics.

Recently, the government has implemented a new public management policy to improve the performance of the public sector, and the government intends to strengthen the public organization, such as the private sector, by strengthening the competition and focusing on performance. As a result of adopting and applying the personnel management system of the private enterprise to the public institution, the workers of the public institution became more immersed in the labor union to cope with the job insecurity and change. At this time, the employee is simultaneously given the role of the organization member and the role of the union member. It is called dual commitment in which workers are immersed simultaneously in the two organizations, the company and the union, without a conflict of roles. In order to confirm the dual commitment, this study identify the relationships among union instrumentality, organizational commitment, union commitment, and organizational citizenship behavior of public employees which have relatively higher union participation rates than private companies. To test the hypothesis, the questionnaires were distributed to 815 employees of 10 public institution under the Ministry of Employment and Labor, and analyzed 429 participants excluding the unsatisfactory response. The hierarchical regression method was used for this analysis. The results of this study, it was found that organizational commitment has found the mediating effect between union instrumentality and organizational citizenship behavior. And it was found that union commitment is a mediator between union instrumentality and organizational citizenship behavior. Workers have identified dual commitment that both their roles as organizational members and their role as trade union members are at the same time immersed without conflict. This study has empirically tested the effect of union instrumentality on the public institution employees in confirming dual commitment, and provides practical implications. And it is found that organizational commitment and union commitment have an effect on organizational citizenship behaviors. In addition, it discussed limitations and further research directions. As a result of limited research conducted by agencies under the Ministry of Employment and Labor, whole public institution can not be generalized. In the future research, it is necessary to collect data by type of public institution, and comparative analysis with private institutions is also needed.

This study investigates the effect of investment of venture capital(hereafter, VC) on the underpricing of initial public offerings(hereafter, IPO). In order to examine the certification role of VC involvement in the IPO market, this paper compare the stock price response to VC backed IPOs and to non-VC backed IPOs. Since VCs expect to recoup their investment through successful IPOs, they have incentives to provide administrative, marketing and managerial support to the issuing firm. They can also reduce the agency problems, such as moral hazard, by monitoring large shareholders. According to the certification theory, the involvement of VC investment sends a positive signal to the market regarding the quality of the issuing firm and therefore reduces the information asymmetry between the insider and outsider of the firm. The mitigated information asymmetry among market participants results in a higher offering price and a decrease in the IPO underpricing. With respect to the certification role of VCs, precedent research provides mixed results. One of the shortcomings of previous studies investigating the role of VCs in Korea is that their sample periods- mostly before 2010- include frequent changes in regulations such as market making and put-back option regulations that can affect the extent of IPO underpricing. These regulations tend to worsen the IPO underpricing phenomenon. Using the sample period between 2011 to 2015, when the market making and put-back option regulations did not operate, this paper can avoid the bias stemming from the regulation change. Our empirical results show that market-adjusted initial returns for VC backed IPO stocks are not lower than those for non-VC backed IPO stocks. We also find that cumulative abnormal returns for the 90-day period after IPO have upward trend for non-VC backed firms while, for VC-vacked firms, they decrease for the first fifteen days and could not recover to the level of initial day returns. These findings reveal that the financial and managerial support of venture capital in the issuing firms does not serve the certification role in Korea, implying that Korea's venture capital market does not function with the same level of developed countries. This study suggests that in order to settle down the proper venture system―investment, exit, re-investment of venture capital―the external growth of venture capital investment should be accompanied by the positive role of venture capital in the IPO market.

The analysis target data, analysis algorithm, and analysis utilization scenario were defined and developed by identifying eight key analysis services by the value chain of the insurance business. Thus, the insurance big data strategy model was shared and diffused to enable small and medium-sized insurance companies to apply the analysis results to their business while minimizing trial and error in the field of big data adoption. Since most business is processed online in the domestic financial sector, the volume of accumulated internal data is enormous, and its types are diverse, and this has consequently improved the level of big data activation compared to other industries; hence the high potential value and possibilities for the utilization of data analysis. Large insurance companies such as S Life Insurance, H Life Insurance, and K Life Insurance have introduced big data analysis to the domestic insurance industry, which is experiencing continuous trial and error due to the lack of shared information on the effects of the introduction and application of big data analysis. The main contents of this case study are as follows. First, development of a strategy model that internalizes big data analysis based on the value chain of the insurance industry. Second, formation of big data analysis environment through the application of open source technology and STT/TA environment for unstructured text analysis. At last, Sharing of big data analysis strategy model that is suitable for the business and data management status of medium-sized insurance companies.

This paper describes industrial sector efficiency comparison by technology level through input oriented DEA methodology and shows a differentiated cause-effect relationship by independent variables in each technology level (OECD industrial classification of R&D intensity: low, medium-low, medium-high, and high). In Korea manufacturing industry, sectoral DEA approach of technical efficiency by technology level was un-precedent and could guide productivity improvement idea in a different technology level sector. In the efficiency comparison, medium-high technology sector is more efficient than medium-low and low technology sectors, but high technology sector’s is lower than medium-high sector due to more diverse employee and researcher structure. In a low technology sector, firms could improve efficiency through R&D investment. The other insight is that R&D investment, employee & researchers does not always improve efficiency especially in inefficient firms, which indicated that firms have to optimize their input factors effectively, sometimes reducing or transferring resources such as R&D investment according to its technology level. R&D investment would improve technical efficiency only in low-technology firms. In a cause and effect of efficiency, high tech. firms would have to choose a production scale to improve their scale efficiency. So far, “technology regime” topic of Marlerba & Osenigo(1996, 1997) has been researched with STEPI’s business innovation survey outcome by many researchers and indicated that R&D investment could induce a different outcome based on innovation condition and knowledge basement. In the meantime, Efficiency related research has focused on only firm-level studies without level-up to technology level. Thus, a combination of the both would be a new approach, which would be able to give a benchmarking idea to inefficient firms by technology level. For a future study, it would be meaningful to study an innovation and knowledge basement condition role with sub-industries categorized by sectoral innovation system. But, I also have to acknowledge that R&D investment and revenue at a same year could be a statistical issue of multi-collinearity though it comes from a survey data sample’s restriction.