Can the Euro Survive?

One of the fascinating aspects of the European debt crisis has been the resilience of the euro. For much of 2011, the euro was a key reserve currency, oblivious to the chaos ravaging European economies. Now, however, the gravity of the crisis is finally dragging down the euro. As the Euro zone debt crisis enters its third uncertain year, the question about whether the euro can survive rises. This paper argues that the euro can survive given policymakers still have in hand various tools. These tools include creating exit rules, implementing new stabilisation rules and instruments, adopting new fiscal policy, introducing conditional Eurobonds, using inflation differentials and providing more independence to the European Central Bank.     

Does the EU need a tax of its own?

The demand has been raised in various quarters recently that the EU should have a tax of its own. What are the reasons behind this demand? And what are the arguments of its opponents?     

Towards a New Euro Crisis?

Intereconomics - There is thus a fundamental credibility issue about the willingness of the ECB to be a lender of last resort in the government bond markets. This will continue to make the eurozone...     

Does the Euro affect the dynamic relation between stock market liquidity and the business cycle?

Does Eurozone equity market liquidity affect economic growth? If so, how does the Euro currency affect the dynamic relationship between growth and stock market liquidity (macro-liquidity relation) of the Eurozone? We address these questions using data from ten Eurozone countries and the UK. The findings document the predictability role of liquidity proxies on economic growth, suggesting that stock market liquidity influences economic growth. The results reveal that liquidity increases substantially after a structural break realized around the Euro's introduction in Europe, and in all countries except Portugal we find that liquidity improvement coincides with higher growth. During periods of high exchange-rate volatility between currencies (which tend to be periods of high uncertainty and economic convergence), growth becomes highly affected by stock market liquidity movements.     

How Does a Product Gain the Status of a Necessity? An Analysis of Necessitation Narratives

The consumer perception of how products gain the status of necessities is characterized by complexity, laden with idiosyncratic consumer experiences, and driven by personally relevant historical developments. This study pushes the theoretical boundaries of understanding consumer necessities by reaching beyond the classification of products into traditional dichotomies such as necessity–luxury and need–want. It focuses on how consumers experience and recount emotion‐laden events in their lives whereby certain products move to being perceived as necessities over time. An analysis of narratives reveals that product necessitation encompasses five stages: familiarization, transformation in the form of redemption or contamination, memorialization, (re)integration and reconstruction, and solidification. Comprehending necessitation experiences is of great interest to marketers in creating effective marketing strategies as well as to public policymakers in ensuring that their citizens have access to life necessities.     

Service with a smile: Does the type of smile matter?

Service providers have often used the mantra of “service with a smile” as a strategy to engender customer satisfaction. The findings of the current research indicate that a smile alone may not be sufficient in achieving service excellence. Specifically, this work extends prior research suggesting that customers have more positive reactions to Duchenne, or authentic, smiles compared to non-Duchenne, or non-genuine, smiles. Two experimental vignette studies examined the influence of the type of smile a service provider displays (Duchenne vs. non-Duchenne) and gender of the service provider on perceptions of service quality, as well as the Stereotype Content Model dimensions of competence and warmth. The results suggest that the type of smile (Duchenne vs. non-Duchenne) impacts evaluations of service providers in terms of their perceived level of competence, as well as their perceived service quality ratings. Implications for the hiring and training of service providers are also discussed.     

Does the length of a customer–provider relationship really matter?

This study examines both a moderator and a mediator of perceived service quality and payment equity as they relate to customer loyalty in the banking industry. Through the moderating factor, the length of the customer–bank relationship, this study builds a conceptual framework for distinguishing between transactional- and relationship-oriented customers and provides an empirical analysis by using structural equation modelling. The empirical findings of this study, the result of the examination of 610 banking customers, showed that different lengths of the customer–bank relationship form loyalty from different variables and from a different path. For transactional-oriented customers, loyalty was built through the achievement of overall customer satisfaction; whereas for relationship-oriented customers, loyalty was built through the establishment of trust. Suggestions and limitations based on the finding are also discussed.     

Does Euro or Dollar Pegging Impact the Real Exchange Rate? The Case of Oil and Commodity Currencies

The aim of this paper is to investigate the equilibrium exchange rates for commodity and oil currencies as well as the discrepancies of their observed exchange rates to these equilibriums. To this end, first, we estimate a long‐term relationship between the real effective exchange rate and economic fundamentals, including the commodity terms of trade. The estimation relies on panel cointegration techniques and covers annual data from 1980 to 2007. Our results show that real exchange rates co‐move with commodity prices in the long run and respond to oil price somewhat less than to commodity prices. Second, we assess the degree of misalignment of these currencies, as the gap between their observed exchange rate and the estimated equilibrium exchange rate. We show that these misalignments are not significantly related to the exchange rate regimes adopted by the countries, either pegged or floating. However, for pegged currencies, the size of misalignments significantly depends on the anchor currency, either the euro or the dollar. A comparison of misalignments of pegged commodity and oil currencies across different periods confirms these results: during periods of dollar (euro) overvaluation, currencies pegged to the dollar (euro) tend to be overvalued; the reverse being true when the dollar (euro) is undervalued. Consequently, pegged currencies are often driven away from their equilibria by wild fluctuations in the key currencies, on which they are anchored.     

Does Television Viewership Play a Role in the Perception of Quality of Life?

Abstract

The authors hypothesized that television viewership influences materialism and dissatisfaction with standard of living, which in turn contributes to feelings of dissatisfaction with life. They collected data from five countries to examine the issue in a variety of cultural and media environments. The countries and types of samples were: United States (consumer panel and college students), Canada (urban households), Australia (urban households), Turkey (urban households), and China (urban households). The results were generally consistent with the hypotheses. However, most of the support came from the U.S. samples. Two possible explanations may account for the findings. One is that the effect of television viewership on life satisfaction is a unique phenomenon that is applicable only to the United States. Given the disparity of viewership levels between the U.S. and other countries, that explanation has some face validity. The other is that the effects were less evident in non-U.S. samples because of methodological limitations of the cross-cultural research. Overall, the results show that television viewership, at least in the U.S., may play a significant role in making people unhappy with their lives. Much of television advertising reinforces material consumption and possession with images of the “good life.” Thus, television advertising contributes to terminal materialism—materialism for the sake of materialism. Socially responsible advertising professionals should make a concerted effort to create messages that reflect instrumental materialism—materialism for the sake of meeting essential and basic needs.     

Who Can Adjust to the Euro?

This study estimates potential exchange rate variation among 26 European countries during 1992–1998, as a proxy for the potential magnitude of adjustment they face to euro‐block membership, using the instrumental variable (IV) method, applying least squares cross‐section regression analysis based on optimal currency area theory. A currency union among Belgium, Denmark, France, Germany, Ireland, Malta, the Netherlands and Slovenia is found to entail a relatively light burden of adjustment for its members. The current membership of other countries in the euro‐block is potentially very demanding on their societies in the long term. This study also compares currency boards and independent central banks as alternative monetary frameworks for disinflation policies. Based on a pooled time‐series, cross‐section dataset of the same countries and years currency boards are found to be more effective in reducing inflation in all countries except Belgium. Balancing EMU's credibility gains against its adjustment costs, Finland, Greece, Italy, Portugal and Spain seem like unstable members of the euro‐block. For all new EU member states except the Czech Republic, Malta, Slovenia and Slovakia the advice is to stay out of the euro‐block until their economies are liberalised and flexible enough to withstand major adjustments, and their societal interest groups supportive enough of these adjustments.     

Does the origin of a succession CEO matter in the market value of innovation? Disentangling the origin of internal CEOs

This study complements previous research regarding CEO origin and family businesses by incorporating upper echelons theory with the perspective of family effect as well as disentangling CEO origin to provide a better understanding of how external, unrelated internal, and family succession CEOs affect innovation performance. We further reveal how a family founder helps improve the value of innovations undertaken by family heirs. The results show that firms with unrelated internal succession CEOs experience higher (lower) stock market reactions to innovation announcements than those with family (external) succession CEOs. Founders serving on the board reduce the negative effect between family heirs and innovation performance. Copyright © 2016 ASAC. Published by John Wiley & Sons, Ltd.     

Does a companion always enhance the shopping experience?

Shopping is inherently a social experience. Extant research has shown that shopping with someone enhances the overall shopping experience. Interestingly, little research qualifies the shopping companion effect. Here, we take into account just who the other person is as well as the level of identification that a shopper has with the shopping environment (high vs. low identification). This study shows limits to the classical effects (shopping with somebody is better) because the improved reactions when shopping with a family member are evident only when the consumer has a low level of identification. However, when the consumer identifies highly with a shopping environment, s/he finds more enjoyment and value shopping alone than with a family member. The results are consistent with theory suggesting consumers will act to protect a preferred experience.     

Does parenting matter in subsidiary innovation in emerging economies? Exploring the role of parent superior competitiveness in affecting subsidiary contextual ambidexterity

Parenting in the multinational enterprises (MNEs) creates a dilemma when parent company manages the subsidiary contextual ambidexterity, in which parent superior competitiveness may nurture subsidiary exploitation while inhibit exploration. This study addresses this dilemma by developing an integrated framework and investigating how parent superior competitiveness affects the subsidiary contextual ambidexterity (innovation initiative and motivation of learning from the parent), which in turn increases subsidiary innovation performance. Furthermore, it is also examined that what tactics subsidiaries should take to resolve the dilemma. Using 296 survey responses from multiple informants of 111 subsidiaries in China, we find that parent superior competitiveness hinders subsidiary innovation initiative, but enhances subsidiary motivation of learning from the parent company. The negative effect of parent superior competitiveness on subsidiary innovation initiative becomes weaker when the strengths of subsidiary external tie and parent-subsidiary communication are enhanced. The positive effect of parent superior competitiveness on subsidiary motivation of learning is strengthened by subsidiary external tie, whereas no significant effect is found of parent-subsidiary communication. In addition, subsidiary innovation initiative contributes to subsidiary innovation performance through knowledge exploration and subsidiary motivation of learning from the parent positively affects innovation performance.     

Does Ethics Statement of a Public Relations Firm Make a Difference? Yes it Does!!

Attempting to determine solutions for unethical practices in the field, this research was designed to assess the effectiveness of public relations firms’ ethics statements in decreasing the incidence of malpractice. This study revealed an encouraging finding that practitioners working in firms with ethical parameters were significantly more likely to engage in ethical practices. Moreover, educating public relations practitioners about the content of ethics statement could positively influence their ethical practices. At the same time, this study’s findings suggest further questions for consideration in future scholarship and in the application of ethics statements to practice within the field.     

Towards New Fiscal Rules in the Euro Area?

Intereconomics - Faced with the impossibility of reaching a political agreement to review the fiscal treaties, the Commission could limit itself to applying the current rules with flexibility,...     

Does transparency influence the ethical behavior of salespeople?

This study introduces the concept of perceived salesperson transparency to the sales literature. It addresses how recent technological developments impact traditional agency theory concerns, while simultaneously creating a conceptual definition of perceived transparency for application on an individual level. Salesperson perceptions regarding managerial use of behavioral information obtained through technological means are empirically found to have a mediating effect on the relationship between managerial access to such information and the likelihood of unethical salesperson behavior. It concludes that salesperson ethical behavior is not influenced by management's ability to obtain behaviorally relevant information, but rather by the use of this information. Further, it is found that the mediating influence of use of information accessed via technology is itself moderated by the salesperson's job performance.     

Does an Overdraft Facility Influence the Customer Costs of Using a Personal Current Account?

This study examines whether personal current accounts offering an overdraft facility cost customers less to use than accounts not offering this service. This analysis uses a UK data set of 222 personal current accounts, recorded monthly between 1995 and 2011, in combination with interest rates from 1200 instant-access deposit accounts offered contemporaneously by the same firms. Our results indicate personal current accounts offering overdraft facilities have higher deposit and payment service costs than accounts not offering this service. The finding is robust to varying service attributes. This result is inconsistent with suggestions that overdraft users have been cross-subsidising other personal current account users as widely reported in theoretical and policy literatures. It is concluded that implicit and inertia costs of personal current account use may be more influential than previously reported in the pricing of these accounts.     

Does the inflation rate affect the performance of the stock market? The case of Egypt

The intention of this paper is to examine the impact of the inflation rate on the performance of the Egyptian stock market. Particular attention is paid to the effects of the rate of inflation on various stock market performance variables, in terms of market activity and market liquidity. From the co-integration analysis through error correction mechanisms (ECM), significant long-run and short-run relationships between the variables are found, implying that the inflation rate has had an impact upon the Egyptian stock market performance generally.     

Who Is the Loser When I Lose the Game? Does Losing an Advergame Have a Negative Impact on the Perception of the Brand?

Many computer games are based on the principle of competition, making the outcome of the game, namely, the prospect of victory and the threat of defeat, a key element. A lab experiment was conducted to study the effects of a game's outcome on the player's mood, brand attitude, and game attitude as well as the experience of flow (N = 95; between-subject design: game lost versus game won versus no induction of the game outcome). The results show that although winners are not in a better mood after the game, they rate the game as better and assess the brands advertised more positively than before they played the game. They have an increased likelihood of experiencing flow, whereas no significant effects of losing the game could be detected due to the total mediation of the flow experience in the case of the losing condition.     

Does the law and finance hypothesis pass the test of history?

For the body of work known as the law and finance literature, the development of financial markets and the concentration of ownership across countries is to a large extent the consequence of the legal system nations created or inherited decades or hundreds of years ago. Despite the seemingly historical nature of this explanation, most of the body of work supporting the law and finance hypothesis has been ahistorical. This paper summarises the business history literature and provides evidence on investor protection and financial development over the long run that challenges the main tenets of the law and finance literature.