Price Limits, Information Acquisition, and Bid–ask Spreads: Theory and Evidence

A number of futures markets use price limits which, in effect, preclude trade from occurring at prices outside certain exogenous bounds. Noting that such markets are characterized by heterogeneously informed traders, whereas previous work on price limits assumes symmetrically informed traders, we examine the effects of price limits in a setting where market participants are asymmetrically informed. We find that imposing price limits generally lowers the quality of information acquired in equilibrium, but lowers bid–ask spreads as well. Thus, depending on the relative weights placed by society on liquidity versus price efficiency, there may exist a set of price limits that are most efficient in achieving a trade-off between liquidity and informational efficiency. We perform empirical tests of some implications of the model using cross-sectional data on price limits. We find that price limits are strongly negatively related to both price volatility and trading volume. Though other explanations for our empirical findings cannot be ruled out, these results are not inconsistent with the model's implication that price limits should be tighter for contracts which offer greater profit potential for informed traders.     

Asymmetric effects of exchange rate movements on traditional and modern services exports: Evidence from a large emerging economy

The service sector in India has emerged as the ‘new engine of growth’ with an increasing share in output and exports. In this paper we analyse the effect of real exchange rate movements on service exports of India, incorporating goods exports, financial development, FDI inflows, world demand and the role of globalization as drivers. We find that while traditional service exports are negatively and significantly affected by the real exchange rate movements, the modern service exports are negatively but not significantly affected. By applying the asymmetric cointegration approach, the results also confirm the non-existence of any asymmetric relationship between the real exchange rate and service exports in India. Further, the results also show that the supply augmenting and demand-side factors are more dominant than the exchange rate to affect service exports from India.     

Return and volatility spillovers between currency and bond markets in India

This paper examines the return and volatility spillovers between the foreign exchange and bond markets of India using a bivariate asymmetric BEKK-GARCH (1,1) model for the period 4 April 2005 to 31 March 2017. We find the evidence of bidirectional return and volatility spillovers with asymmetric effects between these two markets. The spillovers are evidenced even during the periods when foreign portfolio investments in the Indian bond markets were relatively low suggests the existence of strong inter-linkages between both the markets.     

Book Reviews Recensions de livres

Book reviewed in this article: In Search of Meaning: Managing for the Health of Our Organizations, Our Communities, and the Natural World Thierry C. Pauchant Anshuman Prasad is a Visiting Professor at the University of Calgary. He co-edited Managing the Organizational Melting Pot: Dilemmas of Workplace Diversity, Thousand Oaks, CA: Sage, 1997.     

Classification of spammer and nonspammer content in online social network using genetic algorithm-based feature selection

ABSTRACT

The emergence of online social network invokes social actors to share their personal information digitally. Moreover, it provides the facility to maintain their links with people of same interest globally. Take advantage of these services; it has become a fascinating testbed to invite various threats like a spammer. Detection of spammer in OSN is one of the most critical tasks. Spammer not only spreads unwanted or bad advertisement but does certain malicious activity in others' profiles. By clearly understanding the activities of different threats, some incremental and accurate approaches are needed for detecting spammer content and profiles involved in these activities by using social network services. Therefore, the focus of this article is to detect spammer content and account, specifically on the leading microblogging platform called Twitter. We propose a hybrid approach which leverages the capabilities of various machine learning algorithms to separate spammer and nonspammer contents and account. Initially, the optimisation algorithm called genetic algorithm analyses the various features and selects the best suitable features that influence the behaviour of user account, and these features are then used to train classifiers. Our framework achieved to severalise spammer and nonspammer content in an effective way. Finally, to prove the efficiency of our proposed framework, a comparative analysis is conducted with some existing state-of-art techniques. The experimental analysis shows that our approach achieves a high detection rate of 99.6%, which is better than other state-of-art techniques.     

Classification of various attacks and their defence mechanism in online social networks: a survey

Due to the popularity and user friendliness of the Internet, numbers of users of online social networks (OSNs) and social media have grown significantly. However, globally utilised, social networks are the consequence of the lack of understanding of secrecy and protection on OSN and media has increased. Secrecy and surety of OSNs need to be inquired from various positions. According to recent studies, OSN users expose their private information such as email address, phone number etc. In this paper, we have presented a high-level classification of recent OSN attacks for recognising the problem and analysing the blow of such attacks on World Wide Web. We have also discussed OSN attacks on different social networking web applications by citing certain recent reports such as Kaspersky security network and Sophos security threat report. We also offer some simple-to-implement user practice tips to protect the system and user’s information. In addition to this, we have discussed a comprehensive analysis of numerous defensive approaches on OSN security. Lastly, based on the acknowledged strength and faults of these defensive approaches, we have explained open research issues.     

Market making with discrete prices

Exchange-mandated discrete pricing restrictions create a wedgebetween the underlying equilibrium price and the observed price.This wedge permits a competitive market maker to realize economicprofits that could help recoup fixed costs. The optimal ticksize that maximizes the expected profits of the market makercan equal to $1/8 for reasonable parameter values. The optimaltick size is decreasing in the degree of adverse selection.Discreteness per se can cause time-varying bid-ask spreads,asymmetric commissions, and market breakdowns. Discreteness,which imposes additional transaction costs, reduces the valueof private information. Liquidity traders can benefit undercertain conditions.     

Economic issues in recycling end-of-life vehicles

This research paper evolves from problems related to the environment as the result of today's product-based society and especially the end-of-life management of cars. The purpose is to identify key elements in car-scrapping approaches with the potential to meet the following three goals:

• containing the environmental damage from end-of-life cars,

• improvement of current end-of-life car management from an environmental and resource utilization standpoint, and

• fostering manufacturing of scrap-adapted/recycled cars.

An attempt is made to analyze how financial resources could be organized for the ELV recycling system. A few suggestions have been made in order to foster attainment of the above-mentioned goals through an extended producer responsibility through requisite market oriented financial support.In short, this paper takes a look at the economic feasibility and ingredients for success of a market for recyclables. It lays emphasis on some kind of transparency at the economic and technical levels.     

European response to issues in recycling car plastics

This paper discusses the issue of recycling of plastics in the automobile industry which has gained importance due to the proposed European Commission regulation on End-of-Life Vehicles (ELVs) where the EC sets targets on the percent recyclablity or reusability of a car by the year 2015. This proposed regulation puts pressure on the car manufacturers to increase the recyclable and/or reusable components of their product. Plastic poses a critical challenge as on one hand it is necessary to meet the customer demands related to esthetics, light weight and the technological advantages, while on the other hand it is a hurdle in achieving a higher percent recyclability of the ELVs.A closer look on this issue from Europe is necessary as it is expected to set the trend in car recycling regulations all over the world. However, there are many related economic issues that have to be kept in mind while thinking of recycling of plastics (or other components) from ELVs. Tough regulations may not have the solution to the environmental question as the issue has ramifications outside the automotive industry and outside Europe.The significance of plastics in the automotive industry, the proposed ELV directive from the EC and the economic effects of the same, along with the future concerns is discussed here. Further, the paper takes a brief look at the environment in the Indian sub-continent which is considered an emerging market and is flooded with car manufacturers from all over the world, and where issues like recycling are still to attract the attention of the government and the local population.     

An exploratory study of factors affecting credit card brand and category selection in India

This article aims to identify various credit card selection factors in the context of an Asian emerging economy – India. Considering the recent emergence of the three-tier banking system in India, the study proposes to investigate whether there exists an association between credit card selection factors and the type of credit card issuing bank (public, private national or private foreign). The article also seeks to find out whether the income level of the individual determines the type of credit card bank category selection, as prior literature suggests that demographic factors are closely related to credit card selection and usage patterns. The analysis was carried out using a mixed method research design involving thematic analysis of focus group data, factor analysis, PERMAP analysis and multiple correspondence analysis in different phases. Five primary credit card selection factors were identified. A strong correspondence between credit card selection factors, personal income levels and choice of credit card issuing bank was found. Accordingly, credit card selection factors and personal income level were together identified as factors affecting the type of bank selected. The phenomenon of bank category-based stereotyping of brands is emphasized based on the analysis. The implications of this phenomenon with respect to brand identity conception, target segmentation, brand positioning and marketing communication are discussed.