Consumer Skepticism of Claims in Food Ads vs. on Food Labels: An Exploration of Differences and Antecedents

Considerable evidence shows that consumers are skeptical of advertising, that is, have a tendency to doubt the truth of advertising claims. The main focus of our paper is to explore, in the context of food products, whether this typically high level of skepticism is also exhibited for product labels. In addition, we look at consumer skepticism associated with health claims in food ads and labels as well as with the Nutrition Facts Panel on food packages. Finally, we examine some individual difference factors that might influence consumer skepticism. We report the results of a large‐scale survey designed to explore these issues, and we discuss the implications of our findings for public policy and future research.     

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.     

HETEROGENEOUS EFFECTS OF THE ACA MEDICAID EXPANSION ON HOSPITAL FINANCIAL OUTCOMES

This study examines the effect of the Affordable Care Act's Medicaid expansion on hospital financial outcomes. A key innovation relative to prior studies is that we explicitly account for heterogeneity across states in the timing and extent of the expansion as well as across hospital types. We find that Medicaid expansion led to a decrease in uncompensated care expenditures and an increase in average operating margins. The effects were larger in states where the Medicaid expansion led to a greater increase in program eligibility. Operating margins improved most for public hospitals and facilities located in rural areas. (JEL I11, I13, I18)     

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.     

Offshoring Professional Services: Institutions and Professional Control

We examine the reasons why one might expect it to be more difficult to offshore professional work than manufacturing work in a globalized world. We then provide data on the variations in a specific case — the offshoring of diagnostic radiology from the USA, UK and Singapore. We show that existing theories on the ‘offshorability’ of jobs have not captured how national institutions and occupational regulations continue to define professional work. We then review the question of supply from India's perspective and report that both macro‐institutional and organizational contexts make it complicated for Indian doctors to supply much of this service.     

The week-of-the-year effect: Evidence from around the globe

This study investigates another calendar anomaly the literature does not yet address – the week-of-the-year (WOY) effect. Using the weekly returns on the stock market indexes of 20 countries worldwide, for a period that ends in December 2010, the findings demonstrate that returns in Week 44, which starts on October 29 and ends on November 4, are positive in 19 of the 20 countries, and in 18 of them, it is also statistically significant. In contrast, the returns for Week 43, which starts on October 22 and ends on October 28, are negative in 19 of the 20 countries, and statistically significant for most of the countries. We also apply an investment strategy derived from these findings to a prediction period (2009–2010), and find that this strategy beats the simple buy-and-hold policy by a substantial margin.     

Emerging economies in the 2000s: Real decoupling and financial recoupling

The paper documents an intriguing development in the emerging world in the 2000s: a decoupling from the business cycle of advanced countries, combined with the strengthening of the co-movements in the main emerging market assets that predates the synchronized selloff during the crisis. In addition, the paper tests the hypothesis that financial globalization, to the extent that it creates a common, global investor base for EM, could lead to a tighter asset correlation despite the weaker economic ties. While an examination of the impact of alternative financial globalization proxies yield no conclusive result, a closer look at global emerging market equity and bond funds show that the latter indeed foster financial recoupling during downturns, reflecting the fact that they trade near their respective benchmarks and respond to withdrawals by liquidating holdings across the board.     

Theories of choice under risk: Insights from financial markets

To date, the plausibility of theories of choice under risk hinges are mainly on experimental evidence. This paper devises and implements an approach amenable of assessing the performance of three families of models (expected utility, rank-dependent expected utility, and the cumulative prospect theory) using information from financial asset markets. Our findings unequivocally support reference-point dependence, diminishing marginal sensitivity, loss aversion, and nonlinear weighting of (gain and loss) physical probabilities. The empirical observations are found to be robust to, inter alia, the parameterization of the utility and probability weighting functions, “day-of-the-week effects”, the choice of a reference point, and the introduction of possible, low-probability market crashes (peso component).