Is an integrated farm more resilient against climate change? A micro-econometric analysis of portfolio diversification in African agriculture

This paper examines whether an integrated farm that owns both crops and livestock is more resilient under global warming than a specialized farm in crops. Using around 9000 farm surveys across Africa, we explore how farmers choose one of the farm types and how the net revenue of each type varies across the range of climate in Africa. The results indicate that an integrated farm increases in number while a specialized farm decreases across Africa under climate predictions for 2060. The relative profitability of each system against each other also changes. An integrated farm becomes relatively more profitable over specialized farms half a century from now. The impacts of climate change on integrated farms range from 9% loss to 27% gain depending on climate scenarios. Behavioral models can capture portfolio diversification benefits that agro-economic models cannot measure.     

Uncertainty and the volatility forecasting power of option-implied volatility

This study investigates the impact of uncertainty on the volatility forecasting power of option-implied volatility. Option-implied volatility is a powerful predictor of future volatility, particularly during periods of high uncertainty. This is consistent with option-implied volatility being largely determined by volatility-informed traders (rather than directional traders) when uncertainty is high. New volatility forecasting models that incorporate such interaction outperform benchmark models, both in- and out-of-sample. The new models also better predict future volatility during the 2008 global financial crisis, for which benchmark models perform poorly. The results are robust to alternative choices of benchmark models, loss functions, and estimation windows.     

Evolution of a dynamic ridesharing system based on rational behavior of users

A dynamic ridesharing system (DRS) is a system where users can find ridesharing partner(s) at any time, even shortly before making a trip. A DRS that does not consider individual preferences may cause dissatisfied matchings of users in a shared vehicle and lead to abandonment of DRS in the long term. To investigate the evolution of DRS, such as long-term adoption, this study develops a model of DRS considering the rational behavior and learning process of its users. User behavior is considered as travel mode choice and ridesharing partner choice decisions under the expected utility maximization concept. The day-to-day evolution of a DRS is simulated based on the proposed model, and the effects of user learning behaviors and some social factors pertinent to long-term DRS adoption are investigated.     

Sequentially testing polynomial model hypotheses using power transforms of regressors

We provide a methodology for testing a polynomial model hypothesis by generalizing the approach and results of Baek, Cho, and Phillips (Journal of Econometrics, 2015, 187, 376–384; BCP), which test for neglected nonlinearity using power transforms of regressors against arbitrary nonlinearity. We use the BCP quasi‐likelihood ratio test and deal with the new multifold identification problem that arises under the null of the polynomial model. The approach leads to convenient asymptotic theory for inference, has omnibus power against general nonlinear alternatives, and allows estimation of an unknown polynomial degree in a model by way of sequential testing, a technique that is useful in the application of sieve approximations. Simulations show good performance in the sequential test procedure in both identifying and estimating unknown polynomial order. The approach, which can be used empirically to test for misspecification, is applied to a Mincer (Journal of Political Economy, 1958, 66, 281–302; Schooling, Experience and Earnings, Columbia University Press, 1974) equation using data from Card (in Christofides, Grant, and Swidinsky (Eds.), Aspects of Labour Market Behaviour: Essays in Honour of John Vanderkamp, University of Toronto Press, 1995, 201‐222) and Bierens and Ginther (Empirical Economics, 2001, 26, 307–324). The results confirm that the standard Mincer log earnings equation is readily shown to be misspecified. The applications consider different datasets and examine the impact of nonlinear effects of experience and schooling on earnings, allowing for flexibility in the respective polynomial representations.     

Information sufficiency and attribution of responsibility: predicting support for climate change policy and pro-environmental behavior

This study extends the central part of the risk information seeking and processing model to examine how message elaboration influences individuals’ support for climate change mitigation policy and their intention to engage in pro-environmental behavior. Data were collected through online experimental surveys at two large universities in the Northeastern United States. Results indicate that perceived issue salience triggered negative affect and information insufficiency, both of which prompted systematic processing, which subsequently led to greater policy support and stronger intention to adopt more pro-environmental behaviors. From an applied perspective, this study suggests important pathways to encourage greater message elaboration, which may lead to increased public support for mitigation policies and adoption of pro-environmental behavior.     

The mediating role of commitment in healthcare B2B marketing

Business to business transactions in pharmaceutical and healthcare industries may differ from those in other industries in terms of relational marketing factors such as customer acquisition and retention. Purchasing representatives, including medical physicians, may differ in their levels of commitment; this difference plays a mediating role in satisfaction, dependence, and intention to repurchase. This article begins by analyzing the structural relationships among these three variables: commitment, satisfaction, and dependence. The relationships are dichotomized into two dimensions: individual and organizational, and marketing performance is measured as repurchase intention. A critical literature review was conducted to identify key variables and derive their constructs. The subsequent empirical analyses have far-reaching implications from a marketing perspective.     

Peer effects in corporate disclosure decisions

This study examines peer effects in corporate disclosure decisions. Peer effects suggest that the average behavior of a group influences the behavior of individual group members. Consistent with peer effects, I find that disclosures made by industry peers induce firm disclosure. Peer effects in disclosure are more pronounced when a firm's strategic uncertainty is higher, indicating that peer firm disclosure reduces the external uncertainty arising from the firm's interaction with its industry peers and thus increases the precision of managerial private information. I also find that peer effects are stronger when a firm's dependence on external financing is greater, suggesting that peer firm disclosure increases the costs on firm visibility and reputation in capital markets. Overall, these findings suggest that peer firm disclosure shapes a firm's information environment.     

Bank Debt,Flexibility, and the Use of Proceeds from Asset Sales

In the theory of financial intermediation, bank debt is often characterized as being more readily renegotiable than public debt. Banks are also conjectured to gain valuable non-public information through closer monitoring. Given these features, bank debt can theoretically be more flexible than public debt and can lead to better investment/liquidation decisions. We investigate this possibility using a sample of firms facing the important decision of whether to reinvest the proceeds from asset sales or whether to distribute the proceeds to debtholders. While higher levels of leverage are associated with an increased probability of distributing proceeds to creditors, this relationship is significantly muted for bank debt as opposed to public debt. This finding is consistent with the conjecture that bank debt provides enhanced flexibility when compared to public debt. Further we find that asset sale announcement period abnormal stock returns are increasing in firms’ use of bank debt, but not public debt. This suggests that market participants believe that banking relationships are leading to better decision making for this particular type of investment/liquidation decision. We find no significantly different effects of bank vs. public debt on the initial decision to undertake an asset sale in the first place. Thus, in the context of asset sales, the main observable difference arises in the use of proceeds decision, rather than the initial asset sale decision.     

The influence of supply chain collaboration on collaborative advantage and port performance in maritime logistics

Although many academics and practitioners in the maritime industry have recognised the importance of supply chain collaboration (SCC) between ports and port users, there is still a lack of empirical work on this issue. This work empirically investigates the association between SCC, collaborative advantage and port performance in a maritime logistics context. Data were collected via a web-based questionnaire survey which engaged 178 responses from maritime logistics firms in South Korea. Hypotheses were tested by using structural equation modelling, following a hierarchical analysis process. The results confirm that SCC has positive impacts on collaborative advantage, which in turn helps to improve port performance. The finding indicates that collaborative advantage has a full mediation effect on the link SCC-port performance. This work invites managers to recognise the positive outcomes of inter-organisational SCC practices in enhancing collaborative advantage and port performance within port supply chain.     

Factors determining residents’ preparedness for floods in modern megalopolises: the case of the Tokai flood disaster in Japan

This study examines how flood risk perception and home ownership affect residents’ preparedness for floods, focusing specifically on the case of the Tokai flood disaster in Nagoya City, one of Japan’s biggest metropolises, in 2000. The greatest rainfall ever recorded in Nagoya City (566.5 mm) occurred on 11–12 September 2000; as a result, a local river burst its banks and flooded the city. A survey was conducted of residents of the affected area in Nagoya City and its adjacent region. The respondents were asked to rate the extent of their experience with, anticipation of, and preparedness for floods before and after the Tokai disaster in terms of taking special measures against floods. The results showed that the degree of preparedness for floods was determined by the level of fear of floods and the amount of damage sustained during the Tokai flood, especially for homeowners. However, the residents’ preparedness did not depend on their anticipation of floods. These findings show that preparedness for floods depends on ownership of a home, fear of flooding, and the amount of damage from previous floods rather than on previous experience with and anticipation of floods.