The sweet smell of advertising: the essence of matching scents with other ad cues

New technologies enable practitioners to communicate scents in advertisements on various media. The current research examines the importance of matching scent cues to the advertised product, and the joint effect of scent and other cues such as colour on consumer responses to advertising. A 4 × 2 experimental design was conducted, where participants (N = 603) were presented with scented colour print advertisements. Three hierarchical responses were measured: emotional response, attitude, and purchase intention. Findings reveal that higher congruence between scent and the advertised product heightens positive consumer response. Furthermore, this research stresses the significant joint effect of scent and colour cues, and supports the incongruence approach, suggesting that combining scents that are poorly congruent with other sensory cues enhance consumer response. Practical and theoretical implications are discussed.     

What aspects of the job have most effect on nurses?

The study reported here compared the influences of psychological constructs (job demands and scheduling control) and objective work characteristics (shiftwork, night‐work and hospital department type) on job satisfaction, organisational commitment, burnout and withdrawal intentions. Our hypothesis was that psychological constructs have a higher influence on work‐related attitudes than objective characteristics of work schedules. In addition to the main effects, we proposed an interactive hypothesis: poor attitudes would result from high demands and low control rather than from other combinations of both psychological variables. Using a sample of 153 hospital nurses in Israel, the hypotheses were generally supported. As night‐work, shiftwork and working in intensive care units are unavoidable characteristics of the modern medical environment, these findings are meaningful for improving the personal adjustment of hospital nurses.     

Offshoring in the New Global Political Economy

abstract    This essay challenges claims by economists and management scholars that 'offshoring' is simply another form of trade with mutual benefits. I argue that reducing wages through offshoring leads to wealth creation for shareholders but not necessarily for countries and employees, and that many displaced workers have difficulty 'trading up' to higher skilled jobs. Offshoring is a new phenomenon that entails the organizational and technological ability to relocate specific tasks and coordinate a geographically dispersed network of activities. It decouples the linkages between economic value creation and geographic location. The result is the creation of global commodity markets for particular skills and a shift in the balance of market power among firms, workers, and countries.     

Flexible exchange rates as shock absorbers

In this paper we analyze empirically the effect of terms of trade shocks on economic performance under alternative exchange rate regimes. We are particularly interested in investigating whether terms of trade disturbances have a smaller effect on growth in countries with a flexible exchange rate arrangement. We also analyze whether negative and positive terms of trade shocks have asymmetric effects on growth, and whether the magnitude of these asymmetries depends on the exchange rate regime. We find evidence suggesting that terms of trade shocks get amplified in countries that have more rigid exchange rate regimes. We also find evidence of an asymmetric response to terms of trade shocks: the output response is larger for negative than for positive shocks. Finally, we find evidence supporting the view that, after controlling for other factors, countries with more flexible exchange rate regimes grow faster than countries with fixed exchange rates.     

The religious factor in private education

We quantify the religious factor in private education in the United States by calibrating a political economy model of school choice—among public, private-nonsectarian and subsidized religious schools—in which parents differ in their incomes and in their preferences for religious education. This shows strong latent demand for religious schooling, conditioned on current subsidized tuition levels in parochial schools, which is suppressed by the need to “pay twice” for private education. Applying the results of the calibration to gauge the effect of means-tested school voucher programs on religious and nonsectarian private enrollment, we find that when the amount of the voucher is relatively small, including subsidized religious schools in such programs is necessary for providing low-income families effective access to private education.     

Mood and Judgment of Subjective Probabilities: Evidence from the U.S. Index Option Market

Numerous psychological studies show that weather conditions affect people'smood and that mood states are correlated with people's subjective evaluationof future probabilities. In this paper, a new approach is developed and assetmarket data are employed to test the mood-subjective probability relation. Cloudcover and precipitation volume serve as two mood proxies. Our statistical analysissuggests that bad mood states are characterized by investors placing higher probabilitieson adverse events.     

Return and risk in initial public offerings of both shares and warrants

In the past few years there has been an increasing number of new issues of shares of common stock together with warrants intended to raise interest in initial public offerings of relatively young, growing firms. In this study we examine the pricing efficiency of stocks and warrants offered simultaneously to the public as a single unit. We present a model for evaluating the warrants in such offerings and test it empirically against data from the Tel-Aviv Stock Exchange, where such offerings have become standard. We find that the issued units are usually undervalued, allowing for significant abnormal positive returns. But, while the warrants are usually underpriced, the stocks are overpriced. Largely consistent with the evidence from other financial markets around the world, we also find abnormal negative rates of return in the long run.     

A proposal for a more objective measure of de facto constitutional constraints

In this paper we propose two new indicators of de facto constitutional constraints. The indicators are based on the presence or the absence of easily observable political events. This makes the proposed measures relatively objective and easy to verify relative to the most widely used indicators of de jure and de facto constitutions. This paper describes the indicators and demonstrates their usefulness for research on economic development.     

Income and Wealth Inequality in OECD Countries

This paper summarises some of the key findings and policy recommendations of the latest OECD report on income inequality - “In It Together: Why Less Inequality Benefits All”. In particular, the paper presents new findings regarding the trade-off between inequality and growth, as well as with regard to the impact of the economic crisis and of female employment on the distribution of income and the distribution of wealth. Key policy recommendations derived from these findings are the need to promote employment and good quality jobs, to further improve female participation, to invest in education and skills, and to foster well-designed redistribution policies.     

More on the role of switching costs in service markets: A research note

The present paper focuses on several important and under-researched issues related to switching costs (SC) as a defensive marketing tool in retaining customers with complaint handling. While most previous research analyzed the effects of SC on the behavioral intent of customers, our findings have focused on the actual behavior of bank customers; that is, staying with or leaving the bank to which they had complained previously. The findings show that, of the six potential facets of SC, only two significantly affect the actual behavior of complainants, one directly (i.e., Continuity Costs) and the other as a moderator (i.e., Learning Costs). Likewise, a customer's evaluation of the complaint handling affects behavior directly.