Psychological Oil Price Barrier and Firm Returns

In this paper, we investigate the psychological barrier effect induced by the oil price on firm returns when the oil price reaches US$100 or more per barrel. We find evidence of the negative effect of the US$100 oil price barrier for: (a) the entire sample of 1559 firms listed on the American stock exchanges; (b) both foreign and domestic firms, with domestic firms significantly more affected; (c) the 10 different sizes of firms, with the smaller firms less affected compared to the larger firms; and (d) 17 sectors of firms, with firms in the utilities, mining, and administration sectors being the least affected.     

Commodity tax structure under uncertainty in a perfectly competitive market

In a partial equilibrium setting without price uncertainty, the balanced-budget substitution of an ad valorem tax on output for a specific (unit) tax can enhance welfare in imperfectly competitive markets and is without impact in a competitive world. This paper demonstrates that a substitution of this kind can also increase expected output and welfare in a competitive market characterised by uncertainty about the commodity price, if firms can respond to the revelation of demand conditions by altering output.     

Optimal Trade Policy under Homogeneous Bertrand Competition*

In a seminal paper, Eaton and Grossman (1986) conclude that an export tax is optimal if firms produce heterogeneous products and engage in Bertrand price competition. In particular, they made a comment that could be interpreted to mean that even in the case of a homogeneous product, the optimal policy is still an export tax. This paper has re‐examined the case and found that the optimal export policy can be an export subsidy, free trade, or an export tax, depending on the marginal cost differential between the domestic and the foreign firms. Moreover, if government intervention entails a cost, free trade becomes the only optimal policy.     

Taxation and the asymmetric adjustment of selected retail energy prices in the UK

This paper investigates the adjustment of the prices of four key petroleum products in the UK following changes in the price of crude oil. We find significant evidence that the pre-tax prices of diesel, kerosene, and gas oil adjust more rapidly in an upward than a downward direction, but that the pre-tax price of unleaded petrol adjusts symmetrically. However, these patterns are obscured at the pump once one accounts for fuel duty and value-added tax, raising the possibility that firms can use the tax system to conceal rent-seeking behaviour.     

Tax Competition in Vertically Differentiated Markets with Environmentally Conscious Consumers

This paper analyses the effects of tax competition on environmental product quality, pollution and welfare in a two-country, vertically differentiated, international duopoly, in which consumers are environmentally conscious. The firm in each country chooses first the environmental quality of its product (which reflects the emissions generated in the production process) and then the price. In equilibrium one country will be more polluted than the other because firms choose different levels of environmental quality of their products. We find that a country’s optimal commodity tax is higher if the domestic firm is the more polluting supplier. Furthermore, non-cooperative commodity tax rates are inefficiently high in equilibrium. This is because, in this framework with environmentally aware consumers, commodity taxes affect the choice of firms regarding their emissions. Therefore, a domestic tax reduction not only raises the profits of the foreign firm but also lowers its emission levels, resulting in higher welfare for the other country. We also analyse the optimal cooperative and non-cooperative commodity and emission taxes with border tax adjustments. With these two policy instruments available, commodity taxes are higher.     

Estimating the elasticities of gasoline demand: an instrumental variable approach

This article uses a new identification strategy to estimate the demand for gasoline. I show that the monthly gasoline price is endogenous to gasoline demand at the state level, and that gasoline tax and domestic oil first purchasing price together are strong and valid instruments to correct for the endogeneity bias. In addition to estimating the price elasticity, this article also provides an estimate of the income elasticity. These updated estimates are critical factors in evaluating the environmental effect of gasoline tax and forecasting gasoline consumption.     

Oil price effects over individual Portuguese stock returns

During the last decades, the world energy dependence increased significantly. Understanding how companies depend on oil prices is essential, especially for countries highly dependent or importers. The work intends to investigate the relationship between oil price changes and Portuguese listed companies’ returns. Using the generalized autoregressive conditional heteroskedasticity model, we conclude that nearly 20 % of the companies are significantly affected by oil prices, finding also evidence that these effects are asymmetric, depending on the company’s current situation in the market (result attributed to the lack of liquidity and the small number of firms included within the sample). There exists some differences among economic sectors in the way they are impacted by oil price changes, although not so much significant. The results show that the bigger the company, the higher the probability of being significantly affected by oil price changes. Results suggest that lagged oil price positive shocks increase Portuguese companies’ returns, by opposition to the current oil price change. Findings highlight the key role played by aggregate demand-side oil price shocks over the financial economic activity, showing sector and individual companies’ differences, thus inducing the possibility of results being highly dependent over the economic context faced by the country under analysis, that firms are more sensitive to oil prices when the equity market is busiest and that oil price increases affect companies returns in a negative way, but price decreases cause more positive than negative effects over company returns.     

Structural oil price shocks and policy uncertainty

Increases in the real price of oil not explained by changes in global oil production or by global real demand for commodities are associated with significant increases in economic policy uncertainty and its four components (the volume of newspaper coverage of policy uncertainty, CPI forecast interquartile range, tax legislation expiration, and federal expenditures forecast interquartile range). Oil-market specific demand shocks account for 31% of conditional variation in economic policy uncertainty and 22.9% of conditional variation in CPI forecast interquartile range after 24 months. Positive oil shocks due to global real aggregate demand for commodities significantly reduce economic policy uncertainty. Structural oil price shocks appear to have long-term consequences for economic policy uncertainty, and to the extent that the latter has impact on real activity the policy connection provides an additional channel by which oil price shocks have influence on the economy. As a robustness check, structural oil price shocks are significantly associated with economic policy uncertainty in Europe and energy-exporting Canada.     

Prices Versus Quantities: Technology Choice,Uncertainty and Welfare

Technological improvements have proven essential in mitigating environmental problems such as climate change, depletion of the ozone layer and acid rain. While it is well-known that price- and quantity-based regulatory instruments provide different investment levels, the effects on the choice between different technologies have received scant attention. This paper expands on the prices versus quantities literature by investigating firms’ technology choice in the face of demand and supply side uncertainty. I show that the regulator can not design tradable emissions permits and an emissions tax such that the two regimes are equivalent, even in terms of expected values. Moreover, a tax encourages the most flexible abatement technology if and only if stochastic costs and the equilibrium permit price have sufficiently strong positive covariance, compared with the variance in consumer demand for the good produced. Finally, the firms’ technology choices are socially optimal under tradable emissions permits, but not under an emissions tax.     

我国成品油定价机制的弊端及对策分析

本文从我国成品油价格变化迟滞的现象出发．分析了国内外油品的定价机制和国内油品市场的垄断特点，提出了建立多元化的市场主体、营造可竞争性的市场环境、形成合理透明的价格机制、搭建可交易的市场平台、实施完善的石油战略储备计划等解决对策。     

Oil Price Shocks and Volatility in Australian Stock Returns

This paper examines the effect of oil shocks on return and volatility in the sectors of Australian stock market and finds significant effects for most sectors. For the overall market index, an increase in oil price return significantly reduces return, and an increase in oil price return volatility significantly reduces volatility. An advantage of looking at sector returns rather than a general index of stock returns is that sectors may well differ markedly in how they respond to oil price shocks. The energy and material sectors (as expected) and the financial sector (surprisingly) are out of step (in different ways) with results for the other sectors and for the overall index. A rise in oil price increases returns in the energy and material sectors and an increase in oil price return volatility increases stock return volatility in the financial sector. Explanation for the negative (positive) association between oil return (oil return volatility) and returns (volatility of returns) in the financial sector must be based on the association via lending to and/or holdings of corporate bonds issued by firms with significant exposure to oil price fluctuations and their speculative positions in oil‐related instruments.     

Oil price uncertainty and the business cycle: Accounting for the influences of global supply and demand within a VAR GARCH-in-mean framework

ABSTRACT

This article reinvestigates the influence of oil price uncertainty on real economic activity in the United States using a four-variable VAR GARCH-in-mean asymmetric BEKK model. In contrast to previous studies in this area, the analysis focuses on business cycle fluctuations and we control for global supply and demand factors that might affect the real price of oil, its volatility as well as the US economy. We find that – even after accounting for these factors – oil price uncertainty still has a highly significant negative influence on the US business cycle. Our computations show that the effect is economically important during several periods, mostly after a significant variance shift in the mid-1980s. We simultaneously estimate the effect on the global business cycle but find that it is comparatively weak. Finally, significant spillover effects in the GARCH model suggest that oil price volatility is a gauge and channel of transmission of more general macroeconomic shocks and uncertainty. These linkages are particularly strong in case of unexpected bad news.     

Do chairmen with China's Great Famine experience in early-life affect firm tax avoidance activities?

This article investigates whether and how chairmen with China's Great Famine experience affect firm tax avoidance activities. We find that the chairmen who experienced China's Great Famine in early-life engage in fewer tax avoidance activities than other chairmen. This effect is stronger for firms in regions with a weak gambling culture and provinces with higher political uncertainty, nonstate-owned firms, and chairmen with higher education. We show that a lower-level risk appetite among chairmen is the primary mechanism driving lower tax avoidance in their firms. Our article provides new insights into the differences in tax avoidance between firms based on whether managers experienced the Great Famine.     

石油合同对国际油气合作博弈影响分析

本文建立了国际油气合作中的资源国与消费国之间的合作博弈模型,分析了不同的油气合同模式对资源消费国效用水平的影响.研究表明,合同模式在油气合作博弈中扮演着重要角色.从投资者的角度看,为获得效用最大化,投资者不但应注意投资区块的选择,还要对资源国的合同模式进行深入分析和利弊权衡.通过对几种石油合同模式的比较,发现在总收益相同的条件下,从风险大小的角度考虑,纯服务合同带来的效用大于产品分成合同和矿税制合同；从收益的角度考虑,产品分成合同和矿税制合同使资源消费国保留了油价上涨时获取高额利润的权利,带来的效用大于技术服务合同.     

THE POTENTIAL FOR SHORT‐RUN SHIFTING OF A CORPORATE PROFITS TAX

Can the owners of a firm shift a corporate profits tax to consumers? Not in the short run if the tax is stated as a proportion of profits and the firm is a profit maximizer. But what if the firm wishes to pursue a strategy other than profit maximization, say revenue maximization subject to a profit constraint? Under such a condition the firm's reaction to a tax or tax increase might be a price rise that captures part of the foregone profits. We show that firms which operate at a point on their demand curve that differs from profit maximization have an incentive to raise price in response to the tax – and that high cost firms have a greater incentive to raise price than do low cost firms. Our empirical analysis of the US beer industry confirms this finding, and sheds light on the Krzyzaniak–Musgrave analysis of the 1960s which suggested that the corporation income tax produced significant short‐run shifting.     

Oil shocks,US economic uncertainty,and emerging stock markets

This paper investigates the impacts of oil price shocks and US economic uncertainty on emerging equity markets within a structural VAR model. I find that both precautionary oil demand and US economic uncertainty shocks have significant negative effects on emerging stock returns, whereas aggregate demand shocks cause a sustained rise of the returns. In particular, the direct effects of oil shocks on emerging stock returns are amplified by the endogenous response of US economic uncertainty. Variance decomposition analysis shows that oil market fundamentals and US economic uncertainty are an important determinant of emerging equity returns, accounting for 35% and 24% of their long-term variations, respectively. The heterogeneous impacts of structural shocks on individual emerging markets, however, suggest that a well-diversified portfolio can be obtainable.     

浅析2008年油价高位震荡对中国经济的影响

：2008年，国际油价出现了罕见的短期巨幅震荡。本文通过分析此轮石油价格震荡的特点和原因，来阐述国际油价波动对我国经济的影响，并就此提出建议。合理及平稳的油价有助于我国国民经济健康发展，缓解通货膨胀压力。我们应抓住契机，健全中国石油安全保障体系，减轻油价暴涨暴跌对中国经济的负面影响，促进经济发展，维持社会稳定。     

Outsourcing of Unionized Firms and the Impact of Labor Market Policy Reforms

This paper shows that outsourcing of parts of the workforce in unionized firms leads to wage moderation both in the case of strategic and flexible outsourcing. As long as the share of the outsourced workforce is not too large, this wage‐moderation effect on domestic employment outweighs the direct substitution effect so that domestic employment increases in unionized firms as outsourcing costs fall. With respect to the impact of labor tax reform changes in the wage tax rate, the tax exemption and the unemployment benefit payments affect domestic wage setting in the same way as in the absence of outsourcing. Furthermore, increasing the degree of tax progression by keeping the relative tax burden per worker constant continues to be good for employment. However, except for low outsourcing activities, the impact of these policy measures will become smaller as outsourcing costs fall.     

Stock price synchronicity to oil shocks across quantiles: Evidence from Chinese oil firms

This paper investigates behaviour of stock price synchronicity to oil shocks across quantiles for Chinese oil firms. The spillover effects of the oil market on a firm are segregated into firm-specific and market-wide information. First, our results report a higher level of synchronicity by dynamic conditional correlations than by R-square since the former better captures dynamic linear dependence. Second, we find strong evidence of size effect. In particular, stock price synchronicity is generally higher in large-cap firms than in small-cap ones. Oil shocks affect synchronicity in the upper quantiles differently based on firm size. Third, we also find that synchronicity responds to oil shocks significantly in extreme low quantiles, implying that shocks in the oil market are transmitted to Chinese oil firms via firm-specific information. Finally, we determine that oil shocks have little or no immediate impact on stock price synchronicity; instead, cumulative lagged effect is evident. This evidence highlights the lagging effect of spillover of oil shocks on Chinese oil firms.     

Oil prices and economic downturns: the case of Spain

We address the macroeconomic effects of an oil price shock in Spain. We apply a vector autoregression model (VAR) analysis to quarterly data for the Spanish economy since 1986, to elucidate the effects of variations in the oil price on the economy, considering the three main causes of disruptions in the oil markets: oil supply shocks, oil demand shocks and oil-specific (precautionary) demand shocks. We conclude that the effects in Spain strongly depend on the type of shock: the consumer price index (CPI) has mainly been influenced by oil demand shocks; output has only reacted to oil supply shocks; and monetary policy has mainly reacted after precautionary shocks. Second-round effects caused by the behaviour of nominal wages have not been found. Additionally, we discuss two facts: the ability of firms to increase markups in a context of rising demand and the procyclical role of monetary policy when faced with oil demand shocks.