Is time-variant information stickiness state-dependent?

This paper estimates information stickiness with regard to inflation expectations in the United States and the Eurozone for the 1981/06–2015/12 and 1998/Q4–2015/Q2 periods, respectively, and further investigates whether such information stickiness is state-dependent. Based on a bootstrap sub-sample rolling-window estimation, we find that information stickiness varies over time, which contradicts the strict time dependency implied under sticky-information theory. We provide evidence that information stickiness depends on inflation volatility, which indicates that information stickiness is state-dependent and that it has a time trend. Using a threshold model, we estimate structural changes in the state-dependence and time-trend of information stickiness. The results show that information stickiness has been more dependent on inflation volatility and has had a higher time-trend in both regions following the 2008 financial crisis.     

The effects of perceived value on loyalty: the moderating effect of market orientation adoption

This paper aims to identify the moderating effect of service firms’ adoption of market orientation on key variables of consumer behavior, namely perceived value and loyalty. The study took a business-to-customer perspective. First, the adoption of market orientation was measured, from the firm’s point of view. Second, customer perceptions were analyzed, using the two variables perceived value and loyalty. The sample comprised 100 service firms and 572 of their customers. The present work provides original insights, identifying that the effect of perceived value on loyalty depends on other variables external to the consumer, such as the market orientation approach.     

A Note on Utility Maximization with Unbounded Random Endowment

This paper addresses the applicability of the convex duality method for utility maximization, in the presence of random endowment. When the underlying price process is a locally bounded semimartingale, we show that the fundamental duality relation holds true, for a wide class of utility functions and unbounded random endowments. We show this duality by exploiting Rockafellar’s theorem on integral functionals, to a random utility function.     

Dynamic coordinating non-equilibrium

Neo-Walrasian conceptualizations and DSGE models are incompatible with the emergence of coordination and discoordination in economic activity. While many conceptualizations stemming from the Austrian tradition are generally consistent with these fundamental problems, their process driven approach is hampered by the use of equilibrium constructs. This paper argues for the adoption of formal models that avoid this problem by addressing the following questions. Why should Austrian macroeconomists model? Where do models fit in with respect to pure and applied theory? How to model without equilibrium? To answer this final question I present a structure that aids in the construction and communication of such models.     

Bitcoins,Blockchain und Distributed Ledgers

Cryptocurrencies such as bitcoin were invented to facilitate instant payment services without the need for a central bank or financial intermediaries executing payments. Using cryptographic functions, any user of the bitcoin system can transfer units of the virtual currency globally on an anonymous basis. However, financial supervisory authorities are about to increase regulation of virtual currencies due to concerns that the anonymous character of the system facilitates money laundering and the financing of illegal transactions. Nevertheless, the underlying blockchain technology, or in broader terms the distributed ledger technology, may revolutionise several industries. This paper illustrates the functioning and recent market developments in the bitcoin industry as well as the disruptive potential of the underlying technologies.     

You May Not Reap What You Sow: How Employees’ Moral Awareness Minimizes Ethical Leadership’s Positive Impact on Workplace Deviance

Although a growing body of research has shown the positive impact of ethical leadership on workplace deviance, questions remain as to whether its benefits are consistent across all situations. In this investigation, we explore an important boundary condition of ethical leadership by exploring how employees’ moral awareness may lessen the need for ethical leadership. Drawing on substitutes for leadership theory, we suggest that when individuals already possess a heightened level of moral awareness, ethical leadership’s role in reducing deviant actions may be reduced. However, when individuals lack this strong moral disposition, ethical leadership may be instrumental in inspiring them to reduce their deviant actions. To enhance the external validity and generalizability of our findings, the current research used two large field samples of working professionals in both Turkey and the USA. Results suggest that ethical leadership’s positive influence on workplace deviance is dependent upon the individual’s moral awareness—helpful for those employees whose moral awareness is low, but not high. Thus, our investigation helps to build theory around the contingencies of ethical leadership and the specific audience for whom it may be more (or less) influential.     

A generalization to QUAIDS

Previous research shows that consumers’ response to price and income changes is heterogeneous. In addition, evidence from national data often does not support the classical assumption of one commodity-one price. This paper introduces a data coherent generalization to the quadratic form of the almost ideal demand system (g-QUAIDS) that incorporates the sources of heterogeneity in the demand function and allows for regional price variation. Aggregation over consumers imposes a linearization to the g-QUAIDS that requires a new set of price indices. The results from an empirical study by using microdata from the Household Income and Expenditure Survey of Iran highlight the impact of aggregation bias in relation to the level of aggregation. An investigation of the predictive power of linear versus nonlinear g-QUAIDS in different aggregation levels provides practical recommendations for consumer demand analysis.     

Social capital effects on the discovery and exploitation of entrepreneurial opportunities

Social capital refers to social networks and the norms of reciprocity, cooperation and trust associated with them. It can be studied at different levels of analysis. As previous literature suggests, social capital has aspects at both the individual and collective levels. However, theory development and empirical research have focused on separate, sometimes diverging levels. In an attempt to address this, this research examines the simultaneous influence of individual and regional social capital on the discovery and exploitation of entrepreneurial opportunities using individual-level data from the Global Entrepreneurship Monitor linked with regional-level data on social capital. The results show that individuals from regions with higher social capital are more likely to discover and to exploit entrepreneurial opportunities. Moreover, individuals having networks with other entrepreneurs are also more likely to identify a business opportunity and to become an entrepreneur. Also, we found that social capital at individual level had a greater effect than social capital at regional level in the two stages of the entrepreneurial process.     

The Interaction of Financial Attitudes and Financial Knowledge: Evidence for Low-Income Hispanic Families

We add to the literature on the association of financial knowledge and financial attitudes with financial outcomes by focusing on predominantly low-income Hispanic families. We examine (i) saving for emergencies, for college, and in 401(k) plans, and (ii) ownership of a home, land or rental property, and an investment account. We find that financial knowledge is strongly related to our savings measures and to owning an investment account. Financial attitudes play less of a role, but assume some importance when interacted with financial knowledge. Self-reported financial knowledge in addition to factual financial knowledge is associated with favorable financial outcomes. Our results are important for the upward economic mobility of a demographic group that has received less attention in the literature.     

Individual and place-based drivers of self-employment in Chile

This paper analyzes the importance of individual and place characteristics on the selection into self-employment in Chile. Following a structural and multilevel empirical approach, we test whether both sets of variables explain the variation of individual wages, self-employed earnings, and the propensity of being in independent work. The results indicate that while most of the variation in these three outcomes is explained by individuals’ traits, place-related variables account for a non-negligible share of spatial variation. Second, as suggested by occupational choice theories, the propensity of being in self-employment positively correlates with larger expected earning differentials, but only in the case of employers. This, along with other results, suggests that while employers seem to choose their occupational status, own accounts in Chile seem to respond to factors pushing them into self-employment.