• KDI Journal of Economic Policy
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• v.12 no.2
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• pp.95-120
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• 1990

The underpricing of new shares of a firm that are offered to the public for the first time (initial offerings) is well known and has puzzled financial economists for a long time since it seems at odds with the optimal behavior of the owners of issuing firms. Past attempts by financial economists to explain this phenomenon have not been successful in the sense that the explanations given by them are either inconsistent with the equilibrium theory or implausible. Approaches by such authors as Welch or Allen and Faulhaber are no exceptions. In this paper, we develop a signalling model of capital investment to explain the underpricing phenomenon and also analyze the efficiency of investment. The model focuses on the information asymmetry between the owners of issuing firms and general investors. We consider a firm that has been owned and operated by a single owner and that has a profitable project but has no capital to develop it. The profit from the project depends on the capital invested in the project as well as a profitability parameter. The model also assumes that the financial market is represented by a single investor who maximizes the expected wealth. The owner has superior information as to the value of the firm to investors in the sense that it knows the true value of the parameter while investors have only a probability distribution about the parameter. The owner offers the representative investor a fraction of the ownership of the firm in return for a certain amount of investment in the firm. This offer condition is equivalent to the usual offer condition consisting of the number of issues to sell and the unit price of a share. Thus, the model is a signalling game. Using Kreps' criterion as the solution concept, we obtained an essentially unique separating equilibrium offer condition. Analysis of this separating equilibrium shows that the owner of the firm with high profitability chooses an offer condition that raises an amount of capital that is short of the amount that maximizes the potential profit from the project. It also reveals that the fraction of the ownership of the firm that the representative investor receives from the owner of the highly profitable firm in return for its investment has a value that exceeds the investment. In other words, the initial offering in the model is underpriced when the profitability of the firm is high. The source of underpricing and underinvestment is the signalling activity by the owner of the highly profitable firm who attempts to convince investors that his firm has a highly profitable project by choosing an offer condition that cannot be imitated by the owner of a firm with low profitability. Thus, we obtained two main results. First, underpricing is a result of a signalling activity by the owner of a firm with high profitability when there exists information asymmetry between the owner of the issuing firm and investors. Second, such information asymmetry also leads to underinvestment in a highly profitable project. Those results clearly show the underpricing entails underinvestment and that information asymmetry leads to a social cost as well as a private cost. The above results are quite general in the sense that they are based upon a neoclassical profit function and full rationality of economic agents. We believe that the results of this paper can be used as a basis for further research on the capital investment process. For instance, one can view the results of this paper as a subgame equilibrium in a larger game in which a firm chooses among diverse ways to raise capital. In addition, the method used in this paper can be used in analyzing a wide range of problems arising from information asymmetry that the Korean financial market faces.

• Journal of Intelligence and Information Systems
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• v.22 no.1
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• pp.119-138
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• 2016

Since the Industrial Revolution, which made the mass production and mass distribution of standardized goods possible, machine-made (manufactured) products have accounted for the majority of the market. However, in recent years, the phenomenon of purchasing even more expensive handmade products has become a noticeable trend as consumers have started to acknowledge the value of handmade products, such as the craftsman's commitment, belief in their quality and scarcity, and the sense of self-esteem from having them,. Consumer interest in these handmade products has shown explosive growth and has been coupled with the recent development of three-dimensional (3D) printing technologies. Etsy.com is the world's largest online handmade platform. It is no different from any other online platform; it provides an online market where buyers and sellers virtually meet to share information and transact business. However, Etsy.com is different in that shops within this platform only deal with handmade products in a variety of categories, ranging from jewelry to toys. Since its establishment in 2005, despite being limited to handmade products, Etsy.com has enjoyed rapid growth in membership, transaction volume, and revenue. Most recently in April 2015, it raised funds through an initial public offering (IPO) of more than 1.8 billion USD, which demonstrates the huge potential of online handmade platforms. After the success of Etsy.com, various types of online handmade platforms such as Handmade at Amazon, ArtFire, DaWanda, and Craft is ART have emerged and are now competing with each other, at the same time, which has increased the size of the market. According to Deloitte's 2015 holiday survey on which types of gifts the respondents plan to buy during the holiday season, about 16% of U.S. consumers chose "homemade or craft items (e.g., Etsy purchase)," which was the same rate as those for the computer game and shoes categories. This indicates that consumer interests in online handmade platforms will continue to rise in the future. However, this high interest in the market for handmade products and their platforms has not yet led to academic research. Most extant studies have only focused on machine-made products and intelligent services for them. This indicates a lack of studies on handmade products and their intelligent services on virtual platforms. Therefore, this study used signaling theory and prior research on the effects of sellers' characteristics on their performance (e.g., total sales and price premiums) in the buyer-seller relationship to identify the key influencing e-Image factors (e.g., reputation, size, information sharing, and length of relationship). Then, their impacts on the performance of shops within the online handmade platform were empirically examined; the dataset was collected from Etsy.com through the application of web harvesting technology. The results from the structural equation modeling revealed that the reputation, size, and information sharing have significant effects on the total sales, while the reputation and length of relationship influence price premiums. This study extended the online platform research into online handmade platform research by identifying key influencing e-Image factors on within-platform shop's total sales and price premiums based on signaling theory and then performed a statistical investigation. These findings are expected to be a stepping stone for future studies on intelligent online handmade services as well as handmade products themselves. Furthermore, the findings of the study provide online handmade platform operators with practical guidelines on how to implement intelligent online handmade services. They should also help shop managers build their marketing strategies in a more specific and effective manner by suggesting key influencing e-Image factors. The results of this study should contribute to the vitalization of intelligent online handmade services by providing clues on how to maximize within-platform shops' total sales and price premiums.

• Archives of design research
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• v.11 no.1
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• pp.185-197
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• 1998

The domestic publishing market has heen ranked at No.7 in the word publishing market(stastics material in Cultu re and Gymnastics m inistrv )Es pe cia Ill'. publishing quantity of children'book is about to reacb No.3. Such a publishing condition i." showing that Korean publishing world has limit,llion of kind and genre despite of its quant.iative improvement On the ot.her hand. t',reign juvenile publi."hing has multi-publishing form, which is a simultaneous publishing with dolls, audio stuff, game programs and CD-ROM t.itles. Even the animation is considered as of the publication at the planning s tsge. However, when we take a look at domestic condition we come to know that Korean juvenile publishing has been occupied mostly by the studying book. Also, the cautious book selection by the well educated parents in l990's has brought up the change of juvenile publishing world. Such a presen t condition bears of juvenlie publi.,;hing world. Such a present condition bears problem, which is the checking 190 translat.ions among the published picture- books of the last ye ar children's book Nevertheless, there was a sucessful domestic planned creative picture book last year. That is "Puppy s shit", which was sold out 15 000 copies and be st se ller of children's book. Whe n we take a look at the commercial success of "Puppy s shit", it is possible that domestic work holds a position in the publishing market. "Puppy s shit" is the story about valuable nature with Korean styled illustration, which tells the prefemece of Korean book in do mestic pu blis hin f.i market. With the motto "Finding prospect of the Korean creative children's book", this paper was went throu gh. By searchinf.i for creative com ponent.s of picture-book planning such as theme, story, illustration, and edit design through the foreign picture-book "What 1 want. to know from the little mole is who made it on top of his head"-and domestic creative picture/book 'Puppy's shit", this study tried to tell a couple of things like followings publication of Korean creative picture book in t.he world. professional and more artistic inner fabric and originality(the relatio nship be tween stort and illu,tration), improvement of illustration through new formative language with well expressed con ten t, planning improvem ent of Korean creative pictive picture book including literary, artistic and educative component and finally examples of planning, artict and educative component and finally example, of planning the good book with a story and illu,;tration which can in the long run improve the value of life for the children.h can in the long run improve the value of life for the children.

• The Journal of the Convergence on Culture Technology
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• v.3 no.4
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• pp.35-42
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• 2017

Behavior Economics, a branch of social sciences, which seeks to find the answers about why man sometimes does absurd economy-related things, came into existence through combining economics and psychology. To the contrary of the traditional economics', behavior economics has developed by explaining how man makes economy-related choices by means of applying their own cognitive principles. Individuals lack the information on the goods and services in the market, and don't know how to make best use of the obtained information, failing to achieve maximum utility. Therefore, man's rationality is meant to be confined to bounded rationality. It is the very Heuristic that does work in the process of this simplified decision making process. Heuristic utilizes established empirical notion and specific information, and that's why there can be cognitive biases sometimes leading to inaccurate judgment. As Oral Literature is basically based on heavy guesswork and perceptual biases of general public, it is imperative to contemplate oral literature in the framework of Heuristic of behavior economics. This thesis deals with thinking types and behavioral patterns of the short-piece proverbs, folklore language-game riddles on the basis of personal or public memory. As a result, it is evident that proverbs point out biases arising from human behaviors, while riddles make full or active use of biases.

• Cartoon and Animation Studies
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• s.14
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• pp.165-176
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• 2008

In the future there would be many kinds of digital images for many industrial markets. 3D stereoscopic images for variable fields; medical operation, film and animation, broadcasting, internet, game, or design for art and architecture. And many people to work about computer programming, and digital image making will concern about it more and more. However, these kinds works and studies are focused on the professional technical fields like 3D display or computer programming technology so far. To revitalize the market of a variable stereoscopic contents, there should build up the foundation for easy processing of the making stereoscopic images. This paper is based on stereoscopic making skills for anaglyph system. An anaglyph system has an old history about making stereoscopic images, and very simple method to produce the stereoscopic images. Particularly this study is focused on color compositing technique, and camera positioning on the compositing system. It will help optimization of the environments to create 3D motion graphic and animation contents.

• The Journal of the Korea Contents Association
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• v.17 no.4
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• pp.200-208
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• 2017

Despite a rapid market growth in VR, cyber sickness has become the most serious problem in terms of user experience. The aim of this study is to verify whether there are differences in user's perception of cyber sickness by the point-of-view and the movement in VR contents. An experimental testing of game playing with VR headset was conducted on the effects of two conditions: first-person and third-person views in the point-of-view condition, and yaw - pitch rotations in the head movement condition. The results showed that cyber sickness worsened in the first-person point-of-view and in the yaw rotation movement. Point-of-view and movement had main effects on the cyber sickness, but an interaction effect between point-of-view and movement was not found. Based on the findings, along with reducing VR sickness, we proposed practical implications for VR contents planning for building balanced VR user experience. Positive VR experience can be reinforced through visual design, multi-modal interface design, and experience marketing for the optimal level of contents immersion. A future research was suggested on the roll rotation for diverse content genre development.

• The Journal of Korean Institute of Communications and Information Sciences
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• v.35 no.6B
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• pp.908-920
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• 2010

In recent years, mobile phone market is saturated in number of user term. Associated service providers struggle to provide various mobile services such as Internet, e-commerce, game, music etc. to increase ARPU (average revenue per user) instead. In this study we explore the factors which affect price tabs of mobile communication. As a conceptual foundation, this study introduces user factors-users' propensity to use mobile phones-as independent variables and mobile service functions as mediating variables. The research model was phones-as independent variables and mobile service functions as mediating variables. The research model was tested with data from Web-based survey of 1,500 mobile users and analyzed by structural equation modeling (SEM). Our results suggest that user factors impact the usage of mobile service functions and mobile service functions for information and convenience are positively related to price tabs of mobile communication. Implications for mobile service providers and policy makers are discussed.

• Journal of Korea Water Resources Association
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• v.56 no.3
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• pp.225-233
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• 2023

Urban rivers and their surrounding environments have been altered due to factors such as rapid economic growth and urban development. This alteration have caused the rivers to lose their original value and become exposed to various pollution, resulting decrease in citizens' quality of life. This study aims to estimate citizens' Willingness To Pay (WTP) for water quality improvement in Suyeong River in Busan. To estimate the non-market value of the Suyeong River, the WTP of Busan citizens for water quality improvement was estimated, applying Contingent Valuation Method (CVM). The WTP for improving the water quality from Grade 4(polluted water) to Grade 2(game fish like bass can live in it) was estimated using the water quality ladder concept of the US Environmental Protection Agency, assuming annual donations for five years. For the CVM, the logistic distribution and Spike Model were adopted. As a result, citizens residing in the surrounding area of Suyeong River expressed a higher WTP. Considering more than half of the Busan citizens are aware of the "conservation of nature and ecosystems" as a major function of the Suyeong River, this higher WTP could serve as a basis for improving the value of urban rivers.

• Asia pacific journal of information systems
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• v.17 no.2
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• pp.123-137
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• 2007

The advent of the Internet and related Web technologies has created an easily accessible link between a firm and its customers, and has provided opportunities to a firm to use information technology to support supplementary after-sale services associated with a product or service. It has been widely recognized that supplementary services are an important source of customer value and of competitive advantage as the characteristics of the product itself. Many of these supplementary services are information-based and need not be co-located with the product, so more and more companies are delivering these services electronically. Net-based customer service, which is defined as an Internet-based computerized information system that delivers services to a customer, therefore, is the core infrastructure for supplementary service provision. The importance of net-based customer service in delivering supplementary after-sale services associated with product has been well documented. The strategic advantages of well-implemented net-based customer service are enhanced customer loyalty and higher lock-in of customers, and a resulting reduction in competition and the consequent increase in profits. However, not all customers utilize such net-based customer service. The digital divide is the phenomenon in our society that captures the observation that not all customers have equal access to computers. Socioeconomic factors such as race, gender, and education level are strongly related to Internet accessibility and ability to use. This is due to the differences in the ability to bear the cost of a computer, and the differences in self-efficacy in the use of a technology, among other reasons. This concept, applied to e-commerce, has been called the "e-commerce divide." High Internet penetration is not eradicating the digital divide and e-commerce divide as one would hope. Besides, to accommodate personalized support, a customer must often provide personal information to the firm. This personal information includes not only name and address, but also preferences information and perhaps valuation information. However, many recent studies show that consumers may not be willing to share information about themselves due to concerns about privacy online. Due to the e-commerce divide, and due to privacy and security concerns of the customer for sharing personal information with firms, limited numbers of customers adopt net-based customer service. The limited level of customer adoption of net-based customer service affects the firm profits and the customers' welfare. We use a game-theoretic model in which we model the net-based customer service system as a mechanism to enhance customers' loyalty. We model a market entry scenario where a firm (the incumbent) uses the net-based customer service system in inducing loyalty in its customer base. The firm sells one product through the traditional retailing channels and at a price set for these channels. Another firm (the entrant) enters the market, and having observed the price of the incumbent firm (and after deducing the loyalty levels in the customer base), chooses its price. The profits of the firms and the surplus of the two customers segments (the segment that utilizes net-based customer service and the segment that does not) are analyzed in the Stackelberg leader-follower model of competition between the firms. We find that an increase in adoption of net-based customer service by the customer base is not always desirable for firms. With low effectiveness in enhancing customer loyalty, firms prefer a high level of customer adoption of net-based customer service, because an increase in adoption rate decreases competition and increases profits. A firm in an industry where net-based customer service is highly effective loyalty mechanism, on the other hand, prefers a low level of adoption by customers.

• The Journal of the Korea Contents Association
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• v.22 no.10
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• pp.658-675
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• 2022

With the advent of the OTT platform, the world has become an era in which the same media content is shared and reacted in real time by being grouped into one culture. This study attempts a producer study of web novel writers, who are producers of the web novel market that is expanding into webtoons, dramas, and movies with IP (intellectual property rights) of the original story at a time when Korean K-content such as "Squid Game" and "Weird Lawyer Woo Young-woo" leads the global market. In this study, web novel writers were viewed as producers of commercial media content, not just 'Novelist', and their identities and characteristics of the labor process were examined. Web novel writers began writing web novels as a side job or two jobs, and cited the fact that they can make profits alone without barriers to entry and without incurring capital or facility costs. Although there is no barrier to entry, most writers experience severe failure in their first work, which is attributed to the misunderstanding that the word "writer" is someone who writes what they want in any genre. Web novels are different, so writers go through the process of realizing that in order to succeed by writing web novels, they must be thoroughly in the audience's shoes and write them according to the trends and codes they want. Web novel writers expressed their identity as "story sellers," "story producers," "people who can produce IP alone," and "people who satisfy fantasies that cannot be achieved in reality," and in common, there was a strong sense of being a person who provides stories and makes profits or sales. Regarding the burden of writing a huge amount of web novels, the writer with a high income expressed a generous position that "the income is higher than the effort," but ordinary writers complained of difficulties in the hard work, saying, "It seems like I am working hard on writing that I have to write constantly.