THE STATISTICS OF LONG-HORIZON REGRESSIONS REVISITED1

This paper compares commonly used approaches for estimating the relation between long-horizon returns and a predetermined variable X₁, such as dividend yields. Specifically, we look at regression of (i) nonoverlapping multiperiod returns on X_t (ii) overlapping multiperiod returns on X_t, (iii) single-period returns on multiperiod X_t, and (iv) single-period returns on X_t and its implied long-horizon regression coefficient. We provide analytical formulae which quantify the efficiency of the estimators used in the various approaches. Using the formulae, as well as Monte Carlo simulations, we demonstrate that the relative efficiency of the estimators used in the various approaches differs remarkably, depending on the dynamic structure of the regressor. of special interest for financial economists, when the regressors are highly autocorrelated, we find that the regressions (ii) (iii), and (iv) provide only marginal efficiency gains above and beyond the nonoverlapping long-horizon regression.     

Dynamic causality testing for EKC hypothesis,pollution haven hypothesis and international trade in India

This study examines the causality relationships between foreign direct investment (FDI), economic growth (GDP) and CO₂ emissions along with the level of trade (exports and imports) taking place in India. The study uses data obtained from World Development Indicators (WDI) of World Bank Group for the period 1982–2013. The study employed the dynamic multivariate Toda-Yamamoto (TY) approach that uses the modified Wald (MWALD) test. Among the major findings of the study are: the existence of both Pollution Haven Hypothesis and Environmental Kuznets Curve (EKC) hypothesis in India. The other findings of the study are: FDI is causing exports; exports are causing imports; imports are causing CO₂ emissions; and finally CO₂ emissions and GDP are causing each other. This finding concludes mainly two things. First, India imports more of pollution-intensive manufactured goods. Second, FDI is causing GDP in India but through CO₂ emissions.     

A path analysis interpretation of consumer decision-making under conditions of potential risk

This study investigates consumer decision-making processes under conditions of potential risk to personal safety. Potential risk was defined as the individual's subjective interpretation of the likelihood of exposure to hazard or danger and their estimation of the consequences of such exposure. The main concerns were to determine under what conditions consumers would choose a flame resistant apparel item over a non-flame resistant apparel item and to discover the amount of money consumers were willing to pay for the flame resistant (FR) characteristic in apparel. A model of the expected decision process was developed. The variables in the model were (i) internal/external (I/E) control (x₁), (ii) awareness of flame-resistant facts (x₂), (iii) perceived risk (x₃), (iv) buying goals (x₄), and (v) willingness to pay for the FR characteristic. Data used to test the hypothesized relationships among the variables were collected from 136 mothers of pre-school-age children. Path analysis interpretations revealed that the following were the most salient variables affecting the consumer's willingness to pay: (i) perceived risk of clothing-burn injuries; (ii) consumer's feelings of I/E control; and (iii) FR safety as a buying goal.     

Affective cues in persuasion: An assessment of causal mediation

This experiment examined the mediating role of affective cues in persuasion. College students were exposed to advertisements that contained or did not contain affective cues in the form of humor, and that contained or did not contain information about the advertised product. As intended the affective cues were found to influence attitudes toward the advertisement (A_ad), while the productrelevant information was found to influence attitudes toward the advertised product (A_b). By manipulating A_ad and A_b independently, it was possible to test for the causal mediation of one attitude on the other. The results showed that A_b had a significant mediating (p<.05) effect on A_ad, but that A_ad did not significantly mediate A_b.     

Reexamining and extending the dual mediation hypothesis in an on‐line advertising context

The relationship between attitude toward the advertisement (A_ad) and intentions to buy (I_b) is a controversial one. The present research examines the potential for a direct relationship between A_ad and I_b within an on‐line advertising context, substituting A_site (attitude toward the Web site) for A_ad. The article replicates previous findings with respect to the four competing A_ad models they tested. The article then predicts and finds a significant A_site → I_b path based on an opportunity and motivation perspective. In terms of opportunity, Web sites contain nonproduct information that is independent of traditional measures of brand attitude (A_b), such as security, ease of use, transactional capabilities, which are likely to affect I_b. Further, on‐line consumers are motivated to process this information when they visit a Web site because they cannot directly examine the products they are considering. Evidence for the opportunity and motivation perspective is provided by the decomposition of A_site into its claim and non‐claim components and assessment of the A_site → I_b path across levels of motivation to process. Implications for on‐line advertisers are discussed. © 2005 Wiley Periodicals, Inc.     

The Sustainability of Current Account Deficits and Tourism Receipts in Turkey

Current Account Deficits (CAD) in Turkey have reached significantly high levels in the recent years and discussions around the sustainability of these deficits continue. On the other hand, thanks to its rapid development within the same period, the tourism sector is observed to increase its positive contribution to the current accounts balances. This study is an initiative to highlight the contribution of the tourism sector to the sustainability of the CAD in Turkey. Unit root and Cointegration tests have been used to this end. This approach is applied to the long-run relationship between Exports + Tourism Receipts (X + TR) and Imports + Tourism Expenditures (M + TE) for the period of 1980Q1–2005Q2. We question the weak sustainability hypothesis where the cointegrating vector is (X + TR)_t = a + b(M + TE)_t + η _t . In this vector, if b equals to one and η_t is stationary, then the current account deficits are strongly sustainable, if b is between 0 and 1(0 < b < 1) and η_t is stationary or b = 1 but η_t is non-stationary, then the current account deficits are weakly sustainable and lastly, if there is no cointegration or b = 0, then the current account deficits are unsustainable. The empirical results indicate that CAD in Turkey are unsustainable in spite of the rising shares of tourism receipts in current account balances. Therefore, in Turkey, where exports are exceedingly depended on imports, which makes it not very easy to reduce imports, the only way to ensure that CAD are sustainable is to seek options to further increase the tourism receipts.     

“Green cannibalism” or an “organic inside job”? Empirical insights into the rivalry of ethical grocery types

Despite having favorable purchase intentions toward organic groceries, the respective purchase behavior falls often short. This so‐called intention–behavior gap is investigated by exploring the impact of competing ethical products fulfilling green consumption motives (“green fit”) as well or lacking credibility of organic groceries on organic purchase behavior. The first two studies (n ₁ = 225; n ₂ = 321) assessing actual and reported purchase behavior are testing the impact of perceived substitutability of local and fair trade alternatives compared with organic groceries. A third study ( n ₃ = 145) examines the impact of food miles and packaging on perceived product quality and credibility as possible reasons for a lacking “green fit” of organic groceries in terms of an experimental design. Local (fair trade) and organic groceries are perceived as substitute (complementary) alternatives. Additionally, local (organic) “green fit” impedes (enhances) the transformation from organic intentions into a respective purchase behavior. Wrapped organic produces with high food miles are linked to lower quality and credibility perceptions, reducing organic sales rates in favor of local groceries.     

GAME CALL OPTIONS REVISITED

In this paper, having been inspired by the work of Kunita and Seko, we study the pricing of δ‐penalty game call options on a stock with a dividend payment. For the perpetual case, our result reveals that the optimal stopping region for the option seller depends crucially on the dividend rate d. More precisely, we show that when the penalty δ is small, there are two critical dividends 0 < d₁ < d₂ < ∞ such that the optimal stopping region for the option seller takes one of the following forms: (1) an interval if d < d₁; (2) a singleton if d∈ [d₁, d₂]; or (3) an empty set if d > d₂. When d∈ [d₁, d₂], the value function is not continuously differentiable at the optimal stopping boundary for the option seller, therefore our result in the perpetual case cannot be established by the free boundary approach with smooth‐fit conditions imposed on both free boundaries. For the finite time horizon case, the dependence of the optimal stopping region for the option seller on the time to maturity is exhibited; more precisely, when both δ and d are small, we show that there are two critical times 0 < T₁ < T₂ < T, such that the optimal stopping region for the option seller takes one of the following forms: (1) an interval if t < T₁; (2) a singleton if t∈ [T₁, T₂]; or (3) an empty set if t > T₂. In summary, for both the perpetual and the finite horizon cases, we characterize in terms of model parameters how the optimal stopping region for the option seller shrinks when the dividend rate d increases and the time to maturity decreases; these results complete the original work of Emmerling for the perpetual case and Kunita and Seko for the finite maturity case. In addition, for the finite time horizon case, we also extend the probabilistic method for the establishment of existence and regularity results of the classical American option pricing problem to the game option setting. Finally, we characterize the pair of optimal stopping boundaries for both the seller and the buyer as the unique pair of solutions to a couple of integral equations and provide numerical illustrations.     

The Power Of Affective Response And Cognitive Structure In Product-Trial Attitude Formation

Consumers' affective responses to and cognitive structures in thinking about a product, and the influence of these processes on the trial experience evaluation, are examined in experiments where product types (hedonic and functional) and involvements (low and high) are simultaneously manipulated. The results show that affective response overrode cognitive structure under all experimental conditions in forming product-trial attitudes (A₁), whereas the roles of affective response and cognitive structure were similar in product trial-based product attitude (A_p) formation. The implications of the varied roles of affective responses and cognitive structure in overarching models, and their roles in each experimental condition, are discussed.     

Tailor-made single-item measures of doubly concrete constructs

The present study addresses how to measure three constructs commonly used in advertising research, namely attitude towards the ad, brand attitude and brand purchase intention. The study replicates and extends Bergkvist and Rossiter’s (2007) finding that single-item measures are equally predictively valid as multiple-item measures of basic (doubly concrete – see Rossiter’s 2002 C-OAR-SE procedure) constructs in marketing, namely A_Ad and A_Brand. One extension is that the finding holds for free-standing, tailormade single-item measures, whereas the previous study establishes this result only for single-item measures extracted from multiple-item measures. Another extension is that single-item equivalence of predictive validity further holds for another widely employed dependent variable construct, PI_Brand. The present study goes beyond Bergkvist and Rossiter’s study in that it shows that items commonly used in multiple-item measures of A_Ad and A_Brand vary in their predictive validity and that, in some cases, the differences are substantial. The main finding is the further empirical proof that multiple-item scales are unnecessary for validly measuring basic constructs.     

Electronic Marketing Communications: An Evolving Environment,but Similar Story Regarding the Perception of Unsolicited Commercial E-Mail and Postal Direct Mail

The internet is still a relatively new mass communication tool for advertisers and marketers. When weighing the potential benefits of electronic techniques against the financial investment, spam seems particularly attractive to marketers for either for-profit or non-profit objectives. Since it is unlikely that marketers will decrease their efforts related to spam and postal direct mail as a form of communicating to mass consumers, it is important to track consumer attitudes so that audiences are not subjected to the backlash predicted by psychological reactance. The results of this study found that spam is more irritating than postal direct mail at both T₁ (2004) and T₂ (2006), and participants in T₂ found both direct marketing communication methods more intrusive than those in T₁.     

The effectiveness of fear appeals in ‘green’ advertising: An analysis of creative,consumer, and source variables*

This study focused on the effectiveness of fear appeal messages used to arouse a threat in green advertising. An experiment recruited 175 participants to test the influence of the advertising appeal (fear vs. non-fear appeal), source (for-profit vs. non-profit organizations), and involvement with the environment on attitude toward the ad (A_ad), attitude toward the product (A_p) and purchase intention (PI). Results revealed that a fear appeal in a green ad negatively affected A_ad and A_p and that participants who were highly involved with the environment were more likely to have positive attitudes toward the green ad and advertised green product as well as a stronger intent to purchase it. The source type in the green ad did not affect ad effectiveness and involvement with the environment did not moderate the effects of either appeal or source.     

Universal Portfolios

We exhibit an algorithm for portfolio selection that asymptotically outperforms the best stock in the market. Let x_i= (x_i, x_i2,…, x_im)^t denote the performance of the stock market on day i, where x_ii is the factor by which the jth stock increases on day i. Let b_i= (_bi1 b_i2, b_im)^t, b;_ij? 0, b_ij= 1, denote the proportion b_ij of wealth invested in the j th stock on day i. Then S_n= II_iⁿ= bi^tx_i is the factor by which wealth is increased in n trading days. Consider as a goal the wealth S_n*= max_b II_iⁿ=₁ b^tx_i that can be achieved by the best constant rebalanced portfolio chosen after the stock outcomes are revealed. It can be shown that Sn * exceeds the best stock, the Dow Jones average, and the value line index at time n. In fact, S_n* usually exceeds these quantities by an exponential factor. Let x₁, x₂, be an arbitrary sequence of market vectors. It will be shown that the nonanticipating sequence of portfolios db yields wealth such that , for every bounded sequence x₁, x₂…, and, under mild conditions, achieve where J, is an (m - 1) x (m - I) sensitivity matrix. Thus this portfolio strategy has the same exponential rate of growth as the apparently unachievable S*_n.     

The role of time convenience and (anticipated) emotions in AR mobile retailing application adoption

Drawing on cognitive appraisal theory as a theoretical foundation, this research examines the sequential effects of time convenience and (anticipated) emotions on consumer responses to (augmented) mobile retail apps in both pre-usage and usage stages. Two online experiments (N_Experiment1 = 303, N_Experiment2 = 114) using different stimuli reveal that time convenience and emotions stimulate favorable attitude towards the app and hence, behavioral intentions. The findings advance extant literature by identifying time convenience as an important construct prompting positive emotions toward mobile retail apps and consequently, favorable attitude and usage intention. Hence, practitioners should clearly communicate time convenience as an important utilitarian benefit of AR applications.     

Examining the formation of human capital in entrepreneurship: A meta-analysis of entrepreneurship education outcomes

Effective human capital formation through the medium of entrepreneurship education and training (EET) is of increasing concern for governments, as EET is growing rapidly across the world. Unfortunately, there is a lack of consistent evidence showing that EET helps to create more or better entrepreneurs. We undertake the first quantitative review of the literature and, in the context of human capital theory, find that there is indeed support for the value of EET. Based on 42 independent samples (N = 16,657), we find a significant relationship between EET and entrepreneurship-related human capital assets (r_w = .217) and entrepreneurship outcomes (r_w = .159). The relationship between EET and entrepreneurship outcomes is stronger for academic-focused EET interventions (r_w = .238) than for training-focused EET interventions (r_w = .151). We find evidence of heterogeneity in many of our correlations, and recommend that future studies examine potential moderators to more clearly delineate EET effect sizes. We also find a number of methodological weaknesses among the studies analyzed and that those studies with lower methodological rigor are overstating the effect of EET. Recommendations to improve the quality of future work in the field are provided.     

The Bright and Dark Sides of Religiosity Among University Students: Do Gender, College Major, and Income Matter?

We develop a theoretical model involving religiosity [intrinsic (I), extrinsic-social (E _s), and extrinsic-personal (E _p), Time 1], Machiavellianism (Time 2), and propensity to engage in unethical behavior (Time 2) to investigate direct and indirect paths. We collected two-wave panel data from 359 students who had some work experiences. For the whole sample, intrinsic religiosity (I) indirectly curbed unethical intentions through the absence of Machiavellianism, the bright side of religiosity. Both extrinsic-social (E _s) and extrinsic-personal (E _p) directly, while extrinsic-social (E _s) indirectly, exacerbated unethical intentions, the dark side of religiosity. Multiple-group analyses across gender, college major, and income showed that the bright side existed directly for low-income students, but indirectly for males and females, business majors, and low-income students. Our novel finding showed that E _p undermined unethical intentions indirectly for females. For the dark side, E _s incited unethical intentions directly for males, business students, and low-income individuals, but indirectly for females, psychology majors, and low-income people. The Machiavellianism–unethical intentions relationship was the strongest for high-income participants. Religiosity had the highest number of significant paths for low-income individuals and the strongest dark side for males and high-income students, but the highest bright outcome for females. Our novel, original findings foster theory development and testing, add new vocabulary to the conversation of religiosity and unethical intentions, and improve practice.     

Should all firms adapt websites to international audiences?

The authors investigate the moderating roles of brand equity and purchasing risk in the relationships between website cultural congruity (WCC) and two dependent variables: attitude toward the website (A_ST) and trust in the e-vendor. An exploratory study identifies typical French website design elements (graphic design and layout factors) to use in a subsequent experimental study to manipulate WCC. The results reveal that the effect of WCC on A_ST increases when brand equity is weak; for trust, both brand equity and purchasing risk act as moderators. The interaction between brand equity and purchasing risk reveals that WCC only influences trust when brand equity is weak. Overall, the results suggest that strong brand equity outweighs the effects of WCC in terms of improving site attitudes and reducing purchasing risk, with notable managerial and research implications.     

How renewable energy consumption lower global CO2 emissions? Evidence from countries with different income levels

Significant difference in the emission–renewables nexus across countries with different income levels is frequently ignored in previous studies. To empirically investigate whether the effect of renewable energy consumption on carbon dioxide (CO₂) emissions differs across countries with different income levels, the emission–growth–renewables nexus for a global panel of 120 countries and four income-based subpanels over the period 1995–2015 is examined. Fully considering the potential cross-sectional dependence and slope heterogeneity, a series of econometric techniques allowing for cross-sectional dependence and slope heterogeneity is utilised. Cross-sectional dependence and slope heterogeneity are confirmed for the global panel as well as for all four subpanels. Only for the global panel, high-income subpanel and upper-middle-income subpanel is the environmental Kuznets curve (EKC) hypothesis valid. Renewable energy consumption has a negative effect on CO₂ emissions, but its effect is not significant; the mitigation effect may be obscured by higher economic growth and increasing non-renewable energy consumption. The global panel and four subpanels provide mixed directionality of causality among the variables, suggesting that for various income-based subpanels, significant differences exist in the effect of renewable energy consumption on CO₂ emissions, especially highlighting in various direct and indirect influencing paths between renewable energy consumption and CO₂ emissions.     

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).     

Welfare Effects of Food Miles Labels

We assessed the consumer welfare effects of two generic food miles labels: “carbon dioxide (CO₂) emission” label and “time and number of kilometers” label. Using data from a choice experiment, our results generally suggest that a mandatory labeling policy for either type of label would have a positive welfare effect. However, a label informing consumers about the time and number of kilometers the food product has traveled provides greater positive welfare effects than a label informing consumers about the amount of CO₂ emission .