Income and Price Elasticities of Demand in South Africa: An Application of the Linear Expenditure System

This paper investigates the expenditure patterns of South African households using detailed cross‐sectional expenditure and price data that varies across region and time. Linear expenditure system parameter estimates are used to calculate income and price elasticities for a number of product categories at different points of the income distribution. We find substantial variation in the price and income elasticities of demand for items across the income distribution, with the bottom quartile being extremely sensitive to increases in the price of food and clothing items, and the top quartile being as sensitive as households in developed countries.     

Oil price dynamics and airline earnings predictability

This study examines the effect of oil price dynamics on quarterly earnings and their predictability with a sample of 30 airlines for 1994–2017. First, we document a significantly positive impact of demand-driven oil shocks on airline earnings, suggesting that the revenue effect from shifting air travel demands dominates the cost effect of aviation fuels. Regarding earnings predictability, we find evidence of deterioration in oil-volatile quarters as indicated by both the earnings variability based on common benchmarks and the quality of analyst forecasts issued early in the quarter. We further show that supply-driven oil shocks have a more detrimental impact on earning predictability than demand-driven oil shocks. Finally, we do not find supporting evidence for the possible moderating effect of hedging.     

An econometric analysis of demand for food quantity and quality in urban China

This article offers an analytical framework for studying consumer demand for food quality based on a theory‐consistent demand model, namely, the Exact Affine Stone Index specification. Importantly, it accounts for unobserved consumer and regional heterogeneity, and allows for arbitrary Engel curves. The empirical value of our framework is illustrated in an econometric analysis of demand for food quality in China. Evaluating possible structural changes in consumer food expenditures in China is of paramount importance, given the ever‐increasing global role of China and the implications of the structural food preference changes for the global food system. The major findings emerging from this study indicate that income is an important determinant of demand for food quality and quantity with the relatively more affluent provinces having a higher affinity for food quality.     

Determinants of revenue per available room: Influential roles of average daily rate,demand, seasonality and yearly trend

Determining price per room to be charged to customers is an important decision to be taken by hotel management. Hotels frequently change their room rates based on the demand of room, occupancy rate, seasonal pattern, and strategies undertaken by other hotels on pricing. We formulated four models to analyse how various influencing variables, such as hotel price, demand, yearly trend and monthly seasonality influence hotel revenue per available room (RevPar). To analyse a case, we used monthly accommodation statistics for Sweden taken for Swedish Agency for Economic and Regional Growth and Statistics from January 2008 to July 2017. We carried out data analysis using both multiple regression and Multivariate Adaptive Regression Splines (MARS) model and found that application of MARS can help establishing a nonlinear relationship of RevPar with other determining variables in a superior way. We also proposed the possibility of developing a better forecasting model using MARS.     

Modeling Airbnb demand to New York City while employing spatial panel data at the listing level

Using spatial panel data comprising a cross section of 1,461 continuously active Airbnb listings obtained from AirDNA, as well as time series data from NYC and Company and the OECD covering the time period September 2014 to June 2016, the present study quantifies own price, cross price, and income elasticities of Airbnb demand to New York City within an empirical tourism demand framework. The particular goal of the study is to establish whether the relationship between Airbnb and the traditional accommodation industry is of a substitutional or of a complementary nature. Employing a one-way fixed-effects spatial Durbin model, it can be concluded that demand is price-inelastic for Airbnb accommodation in New York City, which is a luxury good, and that the city's traditional accommodation industry as well as neighboring Airbnb listings are substitutes for the investigated Airbnb listings. The estimation results are robust against several alternative specifications of the regression equation.     

Cointegration in China's log import demand: Price endogeneity and structural change

The monthly data of China's log import from January 2000 to December 2013 are used to estimate the import demand elasticities, with the consideration of possible price endogeneity due to China's large share of the international log market, and structural break caused by global financial crisis in 2008. To address the possible structural break, cointegration tests allowing for a deterministic shift in the level of the variables are employed, and a two-stage estimation with top-down sequential elimination algorithm is performed on the restricted subset VECM. The results demonstrate that there exists a long-run cointegration relationship between China's log import and the explanatory variables. The import elasticities of macroeconomic development and import price are around 0.76 and −0.81, respectively. Other things being equal, the structural break would induce a 29.6% decline in China's log import. All the above parameters are significant at the 1% risk level. Furthermore, the contribution decomposition analysis suggests that China's macroeconomic development plays a dominant role in determining its log import, which implies that China's log import would not increase as quickly as before, given that its economy is shifting into the “New Normal State”. This conjecture is supported by our simulations, which indicate that, by 2020, the growth rate of China's log import will be lower than it has been in the past and the import volume would be approximately 1.1–1.6 times greater compared to imports in 2013.     

Factor substitution and taxation in a finance constrained economy

In this paper, we examine the effects of constant-rate factor taxation on macroeconomic stability in the Woodford (1986) model. Our focus is on how the degree of factor substitution, as measured by the elasticity of factor substitution (EOS) in production, affects different balanced-budget tax rules. Analytically, we show that indeterminacy can occur under capital income taxation only when the EOS is very low, whereas indeterminacy under labor income taxation is not subject to the EOS restriction. This finding is robust when we tax all of the factor incomes with equal rates. Thus, in terms of macroeconomic stability, taxing capital income is preferred to taxing labor income.     

珠三角工业设计与工业互动比较研究：双重需求拉动与设计驱动增长的区域验证

动态比较珠三角工业发展阶段和设计水平不同的典型区域内，工业用户和最终消费者用户双重需求拉动设计创新以及设计驱动工业增长作用机制的异同，提出克服互动系统短板并因地制宜实施设计驱动转型升级的对策建议。基于SVAR建模的脉冲响应和方差分解分析发现：珠三角工业确实可以通过工业设计创新驱动实现内生性可持续增长，而设计水平的地区差异对设计驱动绩效有调节作用；工业发展质量和结构欠佳，无法有效拉动区域工业设计创新，是珠三角多数地区工业设计有效需求不足的根本原因。区域工业设计与工业互动系统的短板是缺乏内行和挑剔的最终消费者有效需求。最后基于模型稳健性检验，提出因地制宜科学实施设计驱动发展战略的对策建议。     

Limits to air travel growth: The case of infrequent flyers

Most air travel forecasts predict a long-term rise in demand, with limited consideration of any limits to growth. However for any given population there will be those who have not flown recently (‘infrequent flyers’), as well as non-flyers, and little is known about these and whether they are likely to fly in the future. The aim of this paper is to analyse the characteristics of these groups and the reasons for their travel habits, using the UK as a case study. The findings show that infrequent flyers make up a heterogeneous consumer group whose non-flying is influenced more by budget constraints and personal circumstances than specific aviation factors. Comparisons with Belgian, German and Dutch infrequent flyers indicate some similarities, although there are differences in the relative importance of the reasons for not flying. The findings have implications for the aviation industry and regulators, and policy areas related to consumers and climate change.     

DEMAND,CUSTOMER BASE‐LINE AND DEMAND RESPONSE IN THE ELECTRICITY MARKET: A SURVEY

The increasing use of demand‐side management, as a tool to reliably meet electricity demands at peak time, has stimulated interest among researchers, consumers and producer organiza‐tions, managers, regulators and policymakers. This research reviews the growing literature on models which are used to study demand, customer base‐line (CBL) and demand response in the electricity market. After characterizing the general demand models, the CBL, based on which the demand response models are studied, is reviewed. Given the experience gained from the review and existing conditions, the study combines an appropriate model for each case for a possible application to the electricity market; moreover, it discusses the implications of the results. In the literature, these aspects are studied independently. The main contribution of this survey is attributed to the treatment of the three issues as sequentially interdependent. The review is expected to enhance the understanding of the demand, CBL and demand response in the electricity market and their relationships. The objective is conducted through a combination of demand and supply side managements in order to reduce demand through different demand response programs during peak times. This enables electricity suppliers to save costly electricity generation and at the same time reduce energy vulnerability.