Collapsing exchange rate regimes in the presence of a parallel market

This paper develops a model of an economy where the fixed exchange rate is overvalued and coexists with a parallel market for foreign currency. Such a situation persists because the parallel marker is used by the central authorities as an instrument to delay policy changes. Using the Haïtian experience, this paper estimates a rationing parameter of foreign currency in the official market which translates the extent of tolerance of the parallel market. The paper also produces estimates of onestep-ahead probability of devaluation. Rationing has been severe and the probability of collapse has reached high levels during the period studied.     

Reliability of recall in agricultural data

Despite the importance of agriculture to economic development, and a vast accompanying literature on the subject, little research has been done on data quality. Due to survey logistics, agricultural data are usually collected by asking respondents to recall the details of events occurring during past agricultural seasons, potentially leading to recall bias. The problem is further complicated when interviews are conducted over the course of several months, thus leading to recall of variable length. To test for recall bias, the length of time between harvest and interview is examined for three African countries with respect to several common agricultural input and harvest measures. The analysis shows little evidence of large recall bias impacting data quality. There is some indication that more salient events are less subject to recall decay. Overall, the results allay some concerns about the quality of some types of agricultural data collected through recall over lengthy periods.     

Weathering product-harm crises

To counter the negative effects of a product-harm crisis, brands hope to capitalize on their equity, and often use advertising as a communication device to regain customers’ lost trust. We study how consumer characteristics and advertising influence consumers’ first-purchase decisions for two affected brands of peanut butter following a severe Australian product-harm crisis. Both pre-crisis loyalty and familiarity are found to form an important buffer against the product-harm crisis, although this resilience decreases over time. Also heavy users tend to purchase the affected brands sooner, unless their usage rate decreased significantly during the crisis. Brand advertising was found to be effective for the stronger brand, but not for the weaker brand.

Motivating students to prepare for class and engage in discussion using the hot seat

Accounting accreditation standards place a strong emphasis on student engagement in the learning process (1 and 14). However, budget constraints at many universities are creating larger class sizes, thereby complicating the student-engagement process in two respects. First, it is difficult for professors to motivate students to prepare for class when the students perceive a small probability of being held individually accountable for reading assigned materials. Second, it becomes harder for professors to have one-on-one interactions with students during class as enrollments grow (Litke, 1995). This lack of interaction makes it more difficult to engage students in the learning process. This article describes a teaching approach, called the “hot seat,” that overcomes these challenges by motivating students to prepare for class and engage in the learning process during class. Assessment data suggest that students valued the instructor’s commitment to high-quality instruction and that they believed the hot-seat approach accomplished its intended objectives of increasing student preparation, participation, and learning.     

The Liberalisation of Rail Transport in the EU

On 1 January 2007 the European rail freight market, which has long suffered from fragmentation and a declining share of total transport services, will be fully opened to competition. What will be the consequences for the transport sector and the economy as whole? What further measures are needed to stabilise or increase the railways' share in the freight market? * Member and speaker of the EPP-ED Group (Christian Democrats) in the Committee on Transport and Tourism; rapporteur of the European Parliament responsible for railway issues. ** Views expressed here are not those of NDU or Minnesota.