Weather risk, amplified by climate change, is posing an increasingly severe threat to agricultural production. Index insurance is a promising tool to hedge against weather risk, but traditional contracts face key limitations. Tapping into recent advances in machine learning, HKUST’s Zhanhui Chen and colleagues introduce a novel method of managing weather ... Read More

Violations of social responsibility by suppliers, whether through unethical, dangerous, or irresponsible behavior, attract considerable attention from the media and the public. “When these violations occur, socially conscious consumers may boycott the guilty brands and switch to other brands,” say HKUST’s Albert Y. Ha and colleagues. Their study sheds new ... Read More

Operations management (OM) research is increasingly drawing from a toolbox of econometric methods to test treatment effects. Offering guidance for future studies, HKUST’s Yanzhen Chen and Yatang Lin, together with colleagues, have surveyed the validity of such tools for establishing causality. Their recent review provides a much-needed summary for those ... Read More

Implementing financial sector policies that promote financial inclusion and growth is one of the key goals of developing economies. However, the outcomes are often spatially and temporally uneven. Yan Ji of HKUST and co-researchers develop an innovative model to examine the economic impacts of such policies across space and time, taking as a case study the ... Read More

When making online purchases, consumers often encounter a lengthy list of products whose quality they know little or nothing about, ranked by an unknown algorithm. Users often turn to others’ online reviews to estimate product quality—a process known as social learning. HKUST’s Dongwook Shin and colleagues shed light on the challenges that platforms face ... Read More

Given the recurring nature and pernicious effects of banking crises, a vast regulatory infrastructure has developed to minimize banks’ likelihood of failure by influencing the types of risks they take. Against this backdrop, HKUST’s Arthur Morris and colleagues shed new light on how to structure executive compensation to balance risk-taking with prudence in ... Read More

Informal institutions—the shared but unwritten norms and values of a society—are a critical element of the study of international business. However, research on these institutions is theoretically and empirically challenging. For this reason, “there has been limited work on the topic, a lack of clarity on how to conceptualize and measure informal ... Read More

In an important new study, HKUST’s Guodong Lyu and colleagues show how to optimize resource allocation under stochastic demand. Improving on previous frameworks, they demonstrate that the analysis of three different classes of allocation policy can be unified from the customer perspective, through the concept of the service level. This gives rise to a ... Read More

Power can have a major influence on how we receive, provide, and respond to information. In an important contribution to marketing research, HKUST’s Linying Fan and colleagues show how feeling powerful—a fundamental psychological state—can affect consumers’ construction and reception of communications. They propose a novel psychological mechanism, “need-for ... Read More

Corporate stakeholders have long assessed companies based on indicators of financial performance. Recently, however, “softer” indicators have been added to these assessments, under the rubric of corporate social responsibility (CSR) . Today, CSR significantly influences depositors’ assessments of banks’ trustworthiness, according to HKUST’s Mingyi Hung and ... Read More