Forecasting the price of gold

This article seeks to evaluate the appropriateness of a variety of existing forecasting techniques (17 methods) at providing accurate and statistically significant forecasts for gold price. We report the results from the nine most competitive techniques. Special consideration is given to the ability of these techniques to provide forecasts which outperforms the random walk (RW) as we noticed that certain multivariate models (which included prices of silver, platinum, palladium and rhodium, besides gold) were also unable to outperform the RW in this case. Interestingly, the results show that none of the forecasting techniques are able to outperform the RW at horizons of 1 and 9 steps ahead, and on average, the exponential smoothing model is seen providing the best forecasts in terms of the lowest root mean squared error over the 24-month forecasting horizons. Moreover, we find that the univariate models used in this article are able to outperform the Bayesian autoregression and Bayesian vector autoregressive models, with exponential smoothing reporting statistically significant results in comparison with the former models, and classical autoregressive and the vector autoregressive models in most cases.     

Certification of corporate social responsibility activities in oligopolistic markets

Abstract We investigate the impact of alternative certifying institutions on firms’ incentives to engage in costly Corporate Social Responsibility (CSR) activities as well as their relative market and societal implications. We find that the CSR certification standard is the lowest under for‐profit private certifiers and the highest under a Non Governmental Organization (NGO), with the standard of a welfare‐maximizing public certifier lying in between. Yet, regarding industry output, this ranking is reversed. Certification of CSR activities is welfare enhancing for consumers and firms and should be encouraged. Finally, the market and societal outcomes of CSR certification depend crucially on whether certification takes place before or after firms’ CSR activities.     

Determinants of hotels’ environmental performance: Evidence from the hotel industry in Accra,Ghana

This study explores the factors that account for the environmental performance of hotels in the special context of a developing country, Ghana. It also examined the socio-demographic characteristics of managers and organizational characteristics that determine the environmental performance of Ghanaian hotels. A stratified random sampling method was employed to survey 200 hotel managers from different categories of hotels in Accra. Ninety-four per cent were independent, and Ghanaian-owned. Sixty-seven per cent had fewer than 20 rooms; only 45 had more than 100 rooms. Only 11.6% were affiliated to foreign multinational companies in any way. Six key factors that accounted for the environmental performance were extracted from a factor analysis. They included, in order of most practised, the environmental education and training for staff, measures to support for the host community, conservation project support, compliance with environmental regulations, waste management, and voluntary programmes. A hierarchical multiple regression analysis indicated that larger size and better class of hotels, as well as those with membership of the national hotel trade association, had better environmental performance as did hotels with better paid managers. Affiliation to foreign multinational chains did not predict better performance. A series of suggestions are made to improve the environmental performance of Ghana's hotels.     

Remittances,investment and growth in sub-Saharan Africa

Several studies have examined the impact of remittances on economic growth, yet the results remain largely inconclusive. I present an analysis of the relationship between remittances and per capita growth, and investigate whether the impact of remittances on growth is through capital accumulation or other mechanisms. Using data for sub-Saharan African countries and dynamic empirical models, I find that there is a positive relationship between remittances and growth, as well as a positive interaction effect between remittances and financial depth on growth. The findings also reveal threshold values for two main indicators of financial development, above which the total effect of remittances on growth is positive. The results further provide evidence for the existence of an investment channel through which remittances affect growth, and indirect evidence that remittances contribute towards a stable macroeconomic environment, and hence, growth, through a consumption smoothing effect.     

The endogenous national minimum wage institution

This paper offers reasoning for the endogenous sustainability of the National Minimum Wage Institution (NMWI). In an economy with asymmetries in productivity among unionized firms, high-tech firms may often opt for minimum wage agreements covering all unionized workers, in order to raise the relative costs of their rival low-tech firms. Their workers’ unions as well as the unions of workers in low-tech firms share this interest, provided that the degree of product substitutability is not too low and the wage agreement is not too high. Hence, since economy-wide minimum wage agreements prove to be compatible with the interest of all unions and high-tech firms, the NMWI can be sustained in equilibrium under politically convenient circumstances.     

On the Relevance and Comparability of Segmental Data

The recent adoption in the U.S.A. and Canada of the management approach to identify reportable segments places relevance of the disclosed segmental data as the overriding concern over comparability. This study investigates whether relevance and comparability are mutually exclusive or can be simultaneously achieved in segmental disclosure. It is explicitly recognized that both properties are a joint function of segment performance and segment identification, the performance–identification conundrum. By using a data set drawn from the U.K., a jurisdiction that explicitly allows directors' discretion when identifying reportable segments, and a series of tests which remove performance differences, the potential impact of segment identification on the relevance/comparability issue is highlighted. The results of the tests reveal that for a significant portion of the sample the levels of both relevance and comparability are simultaneously low due to the segment identification choices made. These choices appear to match the possible outcomes of following the management approach to identification.By implication, the adoption of the management approach may lead to reduced comparability and relevance in some cases.     

The dynamics of household beef consumption in Cameroon

Recent changes in economic conditions have introduced notable changes in household beef consumption patterns in Cameroon. While consumers are concerned about the short- and long-run effects of these factors on beef consumption habits, policy makers are more worried about the appropriate period necessary for households to make complete adjustments in consumption since this information is vital for planning production. Static and dynamic demand frameworks involving the Nerlovian partial adjustment (PA) model are used to capture the dynamic nature of beef consumption parameters. Maximum likelihood estimates of the PA model reveal that the conditioning variables explain 79% of the variation in beef consumption. Income, previous consumption, own-price and prices of fish and pork are jointly important in explaining beef consumption habits. Beef is a normal good with pork and fish as substitutes and chicken as a complement. Long-run price and income elasticities are greater than but not significantly different from their short-run values, suggesting that adjustment in consumption is fast with about 80% of the difference between actual and ‘desired’ consumption being completed in about 2 years. Projections show that demand for beef will reach 109620 t by the year 2000. giving an incremental total and per capita demand of 31 730 tons and 1.84 kg, respectively.     

Inflation volatility and stock prices: Evidence from ARCH effects

This paper examines the impact of inflation uncertainty on stock prices in developed as well as in emerging capital markets over the period 1980:1–93:12 via an Autoregressive Conditional Heteroskedasticity (ARCH) model for inflation. The results seem to support the presence of a negative association between inflation uncertainty and stock prices.The authors would like to thank, without implicating, Gikas Hardouvelis, Costas Karfakis, and especially the discussant of the conference session held in Williasmsburg, Robert C. Winder, for helpful comments and suggestions.