Cognitive age and fashion consumption

This study used two‐step structural equation modelling to explore whether cognitive age acts as a mediator between fashion attitudes and fashion behaviours. Three nested and one non‐nested competing models were compared with the base model to determine which model was the best. Data from 1344 consumers showed that cognitive age plays a mediatory role between fashion attitudes and fashion behaviours. It fully mediates between high fashion interest and fashion behaviours, and between utilitarian orientation and fashion behaviours. However, cognitive age only partially mediates between individual taste concern and fashion behaviours.     

The relationship between currency carry trades and U.S. stocks

The article examines the relationship between daily returns of currency carry trades and U.S. stocks from January 1995 through September 2010. Carry trade and stock returns are highly correlated with no Granger‐causality in either direction. An EGARCH model shows that significant volatility spillovers flow from the stock market to the carry‐trade market, but not vice versa. The markets are more correlated in periods of high volatility. Volatilities in both markets also increase more with negative innovations than positive innovations. A sectoral analysis of the index suggests that volatilities of cyclical stocks have more impact than noncyclical stocks on carry trades.     

Some Recent Developments in Futures Hedging

The use of futures contracts as a hedging instrument has been the focus of much research. At the theoretical level, an optimal hedge strategy is traditionally based on the expected–utility maximization paradigm. A simplification of this paradigm leads to the minimum–variance criterion. Although this paradigm is quite well accepted, alternative approaches have been sought. At the empirical level, research on futures hedging has benefited from the recent developments in the econometrics literature. Much research has been done on improving the estimation of the optimal hedge ratio. As more is known about the statistical properties of financial time series, more sophisticated estimation methods are proposed. In this survey we review some recent developments in futures hedging. We delineate the theoretical underpinning of various methods and discuss the econometric implementation of the methods.     

Tipping behaviour: a disconfirmation of expectation perspective

This study examines the effect of expectancy–disconfirmation on tipping behaviour. Findings of our study show that restaurant patrons determine how much tips to give based on the discrepancy between the actual and expected level of food and service quality, rather than the absolute level of food and service quality. That is, given a positive disconfirmation, customers would give more tips. On the other hand, under situations of negative disconfirmation, tip size would drop. Furthermore, we found that the impact of a negative expectancy–disconfirmation on tip size is larger than that of a positive expectancy–disconfirmation of the same magnitude.     

Effects of electronic trading on the Hang Seng Index futures market

This investigation of the switch from open-outcry trading to electronic trading on the Hang Seng Index (HSI) futures contract reveals that the bid–ask spread narrows and the futures price plays more of a role in information transmission. Factors, such as anonymity in trading and fast order execution in electronic trading, attract informed traders to the futures market, enhancing the information flow. Our results provide support for the worldwide trend of transforming open-outcry markets into electronic trading platforms.     

Managing wetlands: an ecological economic analysis of the Hong Kong Wetland Park

This paper addresses the question of whether the Hang Kong government made a rational economic decision when it decided to set aside land to develop a Wetland Park, or whether it should have used the land for alternative commercial developments. Different analytical methods are used to estimate the economic value of the environmental benefits of the Wetland Park： the Value Transfer Method is used to estimate the economic value oJ the ecological services provided by the Park. the Direct Market Price analysis for the economic value of the goods purchased in the Wetland Park, the Hedonic Housing Price Analysis for the value of the Park to those residing in its proximity, the Travel Cost and Contingent Valuation Method for the value of the Park to the visitors, and the Contingent Valuation for the Passive （Nonuse） Values of the Park. These benefits are compared to the opportunity cost of the land and the cost of running the Wetland Park. The article concludes that if a rate of 5% or less is used to discount fiture costs and benefits, we would find that the government＇s decision to set aside land for a Wetland Park was economically sound while using a discount rate of 6% or more shows that it was not.     

Disintermediation of travel agents in the hotel industry

The trend of massive disintermediation is threatening the livelihood of travel agents. This paper investigates the disintermediation of travel agents in the hospitality industry when hotels take distribution back into their own hands by setting up websites that allow guests to make bookings online. We analyze the factors affecting an agent's possible responses to a hotel's destructive acts, and put forward suggestions to agents to fight against the trend of disintermediation. We also point out what hotels can do to improve the quality of their relationship with their agents should they decide to launch their online channel.     

Insured uncovered interest parity

The current literature suggests that uncovered interest parity (UIP) does not hold because of differences in risk in holding different currency denominated debt. We test whether this risk is related to sovereign credit risk in government bonds. We consider an insured uncovered interest parity relationship – that is, one where debt is insured with credit default swap (CDS) contracts. CDS rates help explain the UIP puzzle but have no predictive power for carry trade returns and currency movements.