Information Asymmetry, Bargaining Power and Customer Profitability: An Empirical Investigation on Bank-Client Relationship

2007 ◽  
Author(s):  
Steve Yuching Wu ◽  
Anne Wu
Keyword(s):  
Information Asymmetry ◽  
Bargaining Power ◽  
Empirical Investigation ◽  
Customer Profitability ◽  
Client Relationship

scholarly journals Determinants of the extent of forward looking information: Evidence from UK before financial crisis

2016 ◽  
Vol 13 (3) ◽  
pp. 17-32
Author(s):  
Suzan Abed ◽  
Basil Al-Najjar
Keyword(s):  
Information Asymmetry ◽  
Voluntary Disclosure ◽  
Audit Committee ◽  
Empirical Investigation ◽  
Growth Opportunities ◽  
Cross Listing ◽  
Corporate Size ◽  
The Uk ◽  
Financial Firm ◽  
Forward Looking

The study aims to propose a multi-theoretical framework based on information asymmetry and institutional theories by focusing on the OFR regulation changing period from 2004-2006. We carry out an empirical investigation to detect the extent of forward-looking information for a sample of 690 UK non-financial firm-year observations which are drawn from the top 500 UK. We show that the extent of voluntary disclosure of Forward Looking (FL) information is positively and significantly associated with growth opportunities, leadership, audit committee, competition rate, corporate size, and cross-listing. However, the extent of FL information is negatively and significantly associated with blockholders. This paper applies a multi-theoretical lens based on information asymmetry and institutional theories are employed in order to identify potential new determinants of voluntary disclosure in regards to forward-looking information in the UK context.

Signaling Under Threat: Evidence of Voluntary Disclosure in Contested Takeovers

2020 ◽  
pp. 0148558X2096781
Author(s):  
Gerald J. Lobo ◽  
Kangzhen Xie ◽  
Claire J. Yan
Keyword(s):  
Propensity Score ◽  
Information Asymmetry ◽  
Propensity Score Matching ◽  
Voluntary Disclosure ◽  
Bargaining Power ◽  
Economic Consequences ◽  
Good News ◽  
Earnings Guidance ◽  
Difference In Differences ◽  
Target Management

We investigate voluntary disclosure strategies in contested takeovers and the associated economic consequences. Using a difference-in-differences research design and propensity score matching, we find that, relative to friendly takeovers, target management in contested takeovers provides more earnings guidance and conveys more good news during the takeover. Moreover, voluntary disclosure helps contested targets negotiate a better offer, and the results are stronger for targets with more information asymmetry. Collectively, targets adopt voluntary disclosure and alter their strategies under the threat of contested takeover to enhance their bargaining power. Voluntary disclosure by contested targets serves as a negotiation tactic that potentially benefits target shareholders.

scholarly journals Does Haggling Provide Utility in Information Asymmetric Markets? Evidence from Sales Tactics

2021 ◽  
Author(s):  
Prottay Hasan
Keyword(s):  
Economic Theory ◽  
Information Asymmetry ◽  
Utility Function ◽  
Bargaining Power ◽  
Small Body ◽  
Economic Perspective ◽  
Structured Interviews ◽  
Main Hypothesis ◽  
Developed Economies ◽  
The World

Abstract Economic theory has largely focused on the purely economic motive of haggling: to reach a better price, and a small body of research at the noneconomic. Even in the discussion of the noneconomic, which veers towards psychological ideas of motivations for haggling, I contend that there remains an angle unexplored: that the act of haggling itself provides economic utility to buyers. This idea generates the main hypothesis of the research: in certain markets, there are customers more likely to purchase a good they have haggled for to a certain price than a copy they have not haggled for, at the same price. In certain markets, therefore, one of the factors of the utility function of a good is the utility gained from haggling for it. The research aims to explore this idea from the economic perspective, develop a model and posit possible implications. Analysis is based on data collected from shopkeepers in Dhaka’s ‘Nilkhet’: from structured interviews with bookstore salesmen, and an FGD with apparel store owners which reside in markets prone to haggling. Based on the analysis, a new model on haggling has been developed that tries to explain the pricing in haggling markets. The data suggests that price in information asymmetric markets is set based not only on the bargaining power of producers (a la information asymmetry), but also on the set expectation that customers will haggle and seek haggled purchases. In these markets, utility from the act of bargaining is recognized and creates an additional buffer to the price. The price buffer adds to the previously ‘intended’ price, and is a mechanism by which market recognizes customers’ utility from haggling and charges them for it. It not only accounts for the noneconomic aspect to haggling but, in what ends up being one of the most unexpectedly powerful suggestions of the research, also factors in how shifts in consumer behavior could have resulted in such markets mostly disappearing from developed economies around the world

scholarly journals Horizontal arrangements: strategy for reducing the asymmetry information for dairy farmers in Paraná, Brazil

2015 ◽  
Vol 45 (11) ◽  
pp. 2069-2075 ◽  
Author(s):  
Marcel Moreira de Brito ◽  
Ferenc Istvan Bánkuti ◽  
Sandra Mara Schiavi Bánkuti ◽  
Maria Clara Melo Ferreira ◽  
Júlio César Damasceno ◽  
...  
Keyword(s):  
Factor Analysis ◽  
Information Asymmetry ◽  
Exploratory Factor Analysis ◽  
Empirical Investigation ◽  
Production Systems ◽  
Second Step ◽  
Access To Information ◽  
Dairy Farmers ◽  
Asymmetry Information ◽  
Geographical Regions

An empirical investigation was conducted to study whether dairy farmers involved in horizontal arrangements (HA) have lower information asymmetry than those who do not participate in HA. Our assumption is that greater access to information results in fewer risky decisions in production systems. One hundred and twenty semi-structured questionnaires were applied to dairy farmers located in four different geographical regions in Paraná State, Brazil. Exploratory factor analysis was used to define factors related to information asymmetry in dairy agribusiness system (DAS) and four factors were defined. In a second step, the 120 dairy farmers were split into two groups: the first one involved in HA and the second one not involved in HA. Mean test (t-student) were performed to compare these groups between factors. Significant differences (P<0.05) were observed for factors related to transaction information and for general market information, and dairy farmers participating in HA achieved the greatest values. Finally, it can be concluded that dairy farmers who participate in HA have higher access to information, which can create an environment with lower information asymmetry and, consequently, be subject to lower risks than dairy farmers who do not participate in HA

The Effect of Past Client Relationship and Strength of the Audit Committee on Auditor Negotiations

2011 ◽  
Vol 30 (4) ◽  
pp. 51-69 ◽  
Author(s):  
Helen L. Brown-Liburd ◽  
Arnold M. Wright
Keyword(s):  
Experimental Study ◽  
Bargaining Power ◽  
Audit Committee ◽  
Contextual Factors ◽  
Data Availability ◽  
Negotiation Strategy ◽  
The Past ◽  
Planning Phase ◽  
Client Relationship ◽  
The Impact

SUMMARY Auditors and clients are often required to resolve difficult, complex accounting issues in which they have different views. However, we know little about the effect of contextual factors on auditors' negotiation behaviors. This experimental study involving 63 experienced audit managers and partners examines the impact of the strength of the audit committee (strong or weak) and past relationship with the client (contending or compromising) on auditors' judgments in the pre-negotiation planning phase in resolving a difficult, subjective inventory writedown issue. These two important contextual factors are posited to affect auditors' perceived bargaining power and expectations of difficulties with respect to the impending negotiation. Specifically, we hypothesize an interaction where the most contending position (negotiation strategy) is adopted when the audit committee is strong (enhanced auditor bargaining power) and the past relationship is contending (a difficult negotiation). The findings support these expectations. In additional analyses, we obtain parallel results in the negotiation phase. In all, the findings confirm the importance of strength of the audit committee and past client relationship on auditors' negotiation planning judgments, and the concurrent consideration of these two pervasive contextual factors in the audit environment. Data Availability: Contact the authors.

scholarly journals A Larger Slice or a Larger Pie? An Empirical Investigation of Bargaining Power in the Distribution Channel

2010 ◽  
Vol 29 (1) ◽  
pp. 57-74 ◽  
Author(s):  
Michaela Draganska ◽  
Daniel Klapper ◽  
Sofia B. Villas-Boas
Keyword(s):  
Bargaining Power ◽  
Empirical Investigation ◽  
Distribution Channel

scholarly journals Was Piketty right? Empirics of CCC model: corporate power, consumption, debt and inequality

2019 ◽  
Vol 66 (4) ◽  
pp. 439-464
Author(s):  
Franci Porenta
Keyword(s):  
Theoretical Model ◽  
Power Consumption ◽  
Public Debt ◽  
Bargaining Power ◽  
Private Consumption ◽  
Empirical Investigation ◽  
Oecd Countries ◽  
The Other ◽  
Macro Level ◽  
Corporate Power

This paper provides an empirical investigation into the empirics of cumulative and circular causation (CCC) model. Relying on their corporate power, corporations have stimulated the rising consumerism, which has increased both private consumption and debt. On the other hand, increasing debt has enhanced the process of rising inequality due to the lack of funding to invest in education or create savings. Rising inequality has further increased the bargaining power of capital and closed the CCC model. This paper tests the proposed theoretical model on a sample of OECD countries in the period between 1990 and 2013. We show that the growing corporate power causes increased consumption, growing household and public debt, as well as higher inequality. The paper makes several original contributions to the existing literature. First, it is the first empirical investigation of the CCC relationship. Second, it extends the knowledge about the trends of rising corporate power and consumerism at macro level.

Sign in / Sign up

Export Citation Format

Share Document