Evaluation of the effect of investor psychology on an artificial stock market through its degree of efficiency

The main objective of this article is to develop a Cellular Automaton Model in which more than one type of stockbroker interact, and where the use and exchange of information between investors describe the complexity measured through the estimation of the Hurst exponent. This exponent represents an efficient or random market when it has a value equal to 0.5. Thanks to the various proposals, it can be determined in this investigation that a rational component must exist in the simulator in order to generate an efficient behavior.     

Information,belief elicitation and threshold effects in the 5X1000 tax scheme: a framed field experiment

In this paper, we study by means of a framed field experiment on a representative sample of the population the effect on people’s charitable giving of three, substantial and procedural, elements: information provision, belief elicitation and threshold on distribution. We frame this investigation within the 5X1000 tax scheme, a mechanism through which Italian taxpayers may choose to give a small proportion (0.5%) of their income tax to a voluntary organization to fund its activities. We find two main results: (i) providing information or eliciting beliefs about previous donations increases the likelihood of a donation, while thresholds have no effect; (ii) information about previous funding increases donations to organizations that received fewer donations in the past, while belief elicitation also increases donations to organizations that received most donations in the past, since individuals are more likely to donate to the organizations they rank first.     

Productive Consumption Changing Market Dynamics: A Study in Brazilian DIY Cosmetics

Although several studies have discussed from various perspectives the market-change dynamics of consumption and how consumers impact them, only a few have looked at consumers who act as producers themselves and how they affect the market with their self-production practices. Using data from netnography, participant observation, introspection, and in-depth interviews, this study aims to understand the strategies used by the consumers of DIY (do-it-yourself) cosmetics, which affect the market dynamics and foster a specific market apart from mainstream. We identified three approaches: the strategies such consumers use to make their products; the sharing of consumption experiences; and the disclosure of these products and practices, thereby legitimating them.     

Limits on the Use of Public Space and Consumer Tactics: A Study on Urban Cycling

Although public space is supposed to be democratic and accessible to all, in reality, such access is inegalitarian and exclusionary. The research aims, therefore, to understand how public space that reflects the imposition of interests of dominant ideologies affects the consumption practices of nondominant ideologies. The qualitative research data were collected in the context of urban cycling through in-depth interviews and observation and are analyzed using a hermeneutical approach. The research explains that, in order to deal with the limits of public space use, these consumers use tactics involving (1) disputes for space, (2) disorganized occupation, and (3) transgressive practices; moreover, there is an overlapping relationship between the agency of consumers and public space.     

Millennials’ ethical ideology effects on responses to alcohol advertisements: The role of strength of ethnic identification and ethical appraisal of the ad

Abstract

In an extension of generational theory, the present research argues that ethical ideology (i.e. idealism vs. relativism) impacts attitude toward the ad (A_ad), attitude toward the brand (A_brand), and purchase intention (PI). Additionally, this research examines how this relationship is mediated by the ethical appraisal of the ad and moderated by the level of ethnic identification (i.e. high vs. low). The results of this experiment provide additional evidence in support of generational theory which states that each generational cohort holds distinct ethical ideologies. Furthermore, this study identifies differences in the participants’ responses to alcohol ads resulting from their personal values (i.e. in this study we focus on strength of ethnic identification).     

Development as leapfrogging,not convergence,not catch-up: towards schumpeterian theories of finance and development

Our aim is to demark a pathway towards Schumpeterian theories of finance and development. To do this, we offer four basic propositions for discussion. First, we suggest that ‘convergence’ and ‘catch-up’ are, from a Schumpeterian perspective, theoretically inadequate concepts as they frame development narratives similarly to the Rostovian idea of a linear path towards some sort of ‘equilibrium imposed on history’. Leapfrogging by means of innovation and finance is put forward as a better approach to analyzing development trajectories. Second, we contend that rather than the often-assumed convergence among nations, history shows that ‘divergence’ is a more common result of development trajectories; this is especially visible in the last half a century. Third, we outline the key features of this Schumpeterian framework, centered on the concept of leapfrogging through innovation and finance. We conclude by highlighting the essential roles of finance and financial governance within this alternative framework for understanding successful development trajectories, and posit that this construct may be labeled a Schumpeterian entrepreneurial state.     

Deviations from Fundamentals in US and EU Stock Markets: A Comparative Analysis

Abstract

A ‘two-stage growth’ discounted cash flow (DCF) model is built to test whether changes in the underlying market fundamentals help to explain movements in stock prices. Empirical results on two samples of US and EU stocks show that the ‘fundamental’ earning price ratio (E/P) explains a significant share of cross-sectional variation of the observed E/P, this impact being stronger in the US market. It is also found that: (i) the fundamental component of the E/P has superior explanatory power than simpler measures of expected earnings growth; (ii) ‘non-fundamental’ components, interpreted as signals reducing asymmetric information (such as firm size, the number of forecasts and the chartist momentum), mitigate the role of the fundamentals; (iii) current deviations from the fundamentals are affected by ex post adjustment of publicly available information in the EU sample. It is argued that differences in regulatory environments and in the composition of investors between the US and EU financial systems may help to explain these comparative findings. Results appear consistent with the ‘market integrity hypothesis’ postulating that reliance on publicly observable fundamentals is higher when insider trading is lower.     

Salesperson CLV orientation's effect on performance

Previous studies show how strategies based on the customer lifetime value (CLV) can lead to an increase of profitability for a firm. In this context, marketing serves the purpose of maximizing CLV and customer equity (the CLV of current and future customers). For most types of service firms, salespeople are direct participants in implementing the CLV concept. However, prior research does not answer the question of whether or how salesperson CLV orientation can enhance profits. Using data on salespeople in a large Chilean retail bank, this study shows that the effect of salesperson CLV orientation on salesperson performance follows an S-shaped function (which is first convex and then concave). Additionally, data does not support the idea that the optimum level of CLV orientation depends on salesperson customer orientation, salesperson adaptive selling behavior, or salesperson experience (i.e., CLV-oriented behaviors could be effective across a wide range of salespeople). As such, this study addresses an important concern among researchers and managers that is related to how to increase the salesperson performance. The findings of this study suggest that firms need to monitor individual salesperson CLV orientation more closely.     

Efficiency of venture capital firms: evidence from Spain

In recent years the venture capital (VC) sector has played an increasingly important role in financial systems. In general, this type of specialised financial activity is conducted by two types of operators, VC firms and VC management companies, each with its specific characteristics. The main objective of this paper is to evaluate the operating efficiency of these financial intermediaries in Spain, using data envelopment analysis, and to carry out an exploratory study of the variables that affect their level of efficiency, using a truncated regression model, and taking into consideration the nature of the operator (an approach not previously undertaken). Our analysis reveals, first, differences in the levels of efficiency achieved by VC firms and VC management companies and, second, that the most efficient organisations are those with more diversified ownership structures and which have a portfolio of companies active in the most innovative sectors.     

A theory of political cycles

We study how the proximity of elections affects policy choices in a model in which policymakers want to improve their reputation to increase their reelection chances. Policymakers' equilibrium decisions depend on both their reputation and the proximity of the next election. Typically, incentives to influence election results are stronger closer to the election (for a given reputation level), as argued in the political cycles literature, and these political cycles are less important when the policymaker's reputation is better. Our analysis sheds light on other agency relationships in which part of the compensation is decided upon infrequently.