Evaluating spatial and temporal variation in agricultural output elasticities in Turkey

This study evaluates spatial variation in the relationship between agricultural output and input use across Turkey. The potential impact of the national agricultural policy reform introduced in 2001 on the spatial variation in agricultural output elasticities across the country was explored. By applying a spatial production function to the province‐level data in 2000 and 2007, spatial heterogeneity in the variance of provincial total factor productivity and the input factor‐output elasticities was identified across the country. Results show that the disparities in agricultural activities and geographic conditions affected return from input factors. Empirical findings from a spatial spillover model also suggest that changes in the input factor‐output elasticities varied significantly across Turkey between 2000 and 2007, after the policy reform. Results suggest that future policy reform that recognizes regional comparative advantage through understanding the geographic heterogeneity of the agricultural sector is important for enhancing Turkey's agricultural output.     

Does the Exchange Rate Matter to Agricultural Bilateral Trade between Canada and the U.S.?

This study examines the effects of the Canada–U.S. exchange rate on bilateral trade of agricultural goods between the two countries and on U.S. farm income. Special attention is given to agricultural trade between the two countries under the Canada–U.S. Free Trade Agreement (CUSTA). This study utilizes two time series models: the vector error correction model (VECM) and the vector moving average model (VMA) with quarterly time series data from 1983 to 2000. It is found that the exchange rate has a significant impact on U.S. agricultural trade with Canada, but the impact on U.S. agricultural price and income is insignificant. The exchange rate between the two currencies is found to be weakly exogenous in the U.S. agricultural sector, which answers a fundamental question about the role of the exchange rate in Canada–U.S. bilateral trade for agricultural products. In addition, the results point to a significant, though minimal, effect on bilateral trade due to CUSTA.     

Optimistic bias in management forecasts by Japanese firms to avoid forecasting losses

Listed firms in Japan are effectively compelled to report management forecasts of sales, ordinary income, and net income along with actual earnings and sales each year. Prior studies report that Japanese managers tend to announce optimistic forecasts of earnings. We show that a large part (61.6%) of the overall optimistic bias in management earnings forecasts in Japan can be explained by loss forecast avoiding behavior of a small fraction (5.25%) of firms. Such behavior is caused in part by the view of the main bank and power group that the management forecast of earnings is the manager's earnings target. Our findings suggest that the Japanese stock market recognizes such loss forecast avoidance and accordingly discounts new information in management forecasts.     

An assessment of inflation targeting in a quantitative monetary business cycle framework: evidence from four early adopters

This article examines the effectiveness of inflation targeting (IT) to stabilize the real economy in advanced countries where IT was adopted in the early 1990s. To quantitatively assess IT, this article employs the monetary business cycle accounting methodology recently developed by ?ustek (2011), which is an extended version of Chari, Kehoe, and McGrattan (2007), to monetary models. Our main finding is that the monetary policy wedge that captures economic fluctuations caused by monetary policy has significantly declined since the implementation of IT in the early 1990s. The results suggest that advanced economies, such as Australia, Canada, Sweden and the United Kingdom, that adopted IT in the early 1990s have been successful in stabilizing business cycle fluctuations.     

The Effects of Korean Pop Culture on Hong Kong Residents' Perceptions of Korea as a Potential Tourist Destination

The goal of this study is to assess the influences that Korean pop culture has on Hong Kong residents' perceptions of Korea as a potential tourist destination. Among the 500 distributed questionnaires, 456 were collected. Finally, 440 usable surveys were used for data analysis after eliminating 16 questionnaires with multiple missing answers that were deemed unusable. Data analyses produced many meaningful results. For example, respondents who were less educated and tended to spend more on Korean cultural products had a higher intention to visit Korea after they tasted Korean food. Expenditures on Korean cultural products were a significant contributor to Hong Kong residents' intention to visit Korea after experiencing the three types of Korean pop culture used in this study. Results of this study confirm those of previous studies, which found that the media had a significant influence on a person's choice of tourist destination.     

Incivility in political advertisements: a look at the 2012 US presidential election

The 2012 presidential election reached new heights in dollars spent and the rancorous nature of advertisements emanating from candidates and other interested parties. While ‘going negative’ has become a well-known tactic in political campaigns, several observers believe that the level of acrimony crossed the line between civil discourse essential to democratic societies and uncivil haranguing that has little to do with election issues. To explore the nuances of this topic, we open with a discussion of limited cross-disciplinary research on incivility in political discourse so that its essential nature is exposed, differentiating it from more common uses of negativity. Our empirical work examined about 350 television advertisements that were shown between the presidential debates of 2012 and the November elections. Levels of civility and incivility are noted and implications for the future of political advertising are provided.     

An empirical analysis of property appraisal and mortgage redlining

The recent literature advances a hypothesis that addresses the possibility of mortgage redlining caused by a dynamic information externality in property appraisals and mortgage lending. In particular, Lang and Nakamura (1993) hypothesize that because property appraisals depend on past transactions, appraisals in neighborhoods where transactions were infrequent tend to be less precise. The greater uncertainty about house valuation in such neighborhoods can lead mortgage lenders to impose stringent requirements on borrowers. Lang and Nakamura's article, like most economic analysis of property appraisals, is theoretical. Using a sample of mortgages purchased by Fannie Mae, we present preliminary research results that cast doubt on appraisal behavioral rules such as weighted averages or backward-looking expectations on which Lang and Nakamura and other theoretical studies are based. Instead, our results refocus attention on the moral hazard issues of appraisal. We find that in more than 80 percent of the cases, the appraisal is between 0 and 5 percent above the transaction purchase price, in only 5 percent of the cases is the appraisal lower, and in 30 percent of the cases, the appraisal and transaction prices are identical. It would take a strong statistical model to generate such occurrences. Our resutls also indicate that appraisal outcomes are used as a risk factor with different weights for loans with different characteristics (loan-to-value ratios and house prices). The results suggest that more empirical investigation of appraisal practices be conducted to verify the validity of conventional wisdom embedded in theoretical studies, and we offer an econometric framework toward this end.     

Racial and ethnic differences in housing demand: An econometric investigation

This article empirically investigates the sources of housing demand differences between racial (black and white) and ethnic (Hispanic and non-Hispanic) groups. We estimate the tenure-adjusted housing demand equations from the 1989 American Housing Survey (AHS) national sample data and measure the effects of different sources for demand disparities in housing demand, but much less so in explaining racial differences in housing demand. Specifically, 98% (96%) of the housing demand differences between Hispanic and non-Hispanic owners (renters) is due to differences in group endowments. For the racial groups, 29% (51%) of the housing demand differences between black and white owners (renters) is attributable to differences in group endowments. The residual differences explain 71% and 49% of the black-white differentials for owners and renters, respectively. The residual components in our model capture the effect of institutional and structural factors intrinsic to the housing market (such as racial discrimination or residential segregation) and/or the influence of important omitted or harder-tomeasure variables correlated with race or ethnicity (such as wealth, employment history, credit history, and cultural differences in housing consumption).     

Strategic stability and uniqueness in signaling games

A class of signaling games is studied in which a unique Universally Divine equilibrium outcome exists. We identify a monotonicity property under which a variation of Universal Divinity is generically equivalent to strategic stability. Further assumptions guarantee the existence of a unique Universally Divine outcome.     

DETERMINANTS OF EARNINGS-PRICE RATIOS: A REEXAMINATION

This paper incorporates recent equity valuation theories into the examination of determinants of earnings-price (E/P) ratios to explain cross-sectional differences in E/P ratios. The results show that ex ante measures of risk and growth as well as the payout ratio are the main determinants of E/P ratios. The persistence measure is not significantly related to E/P ratios. The results are robust to ordinary least square models as well as to a tobit censored regression.