On the exposure of the BRIC countries to global economic shocks

The financial crisis led to a deep recession in many industrial countries. While large emerging countries recovered relatively quickly, their performance deteriorated in recent years, despite the modest recovery in advanced economies. The higher divergence of business cycles is closely linked to the Chinese economy. During the crisis, the Chinese fiscal stimulus prevented an abrupt decline in GDP growth not only in that country, but also in resource‐rich economies. Due to lower commodity demand, the environment became more challenging for many emerging markets in recent years. This view is supported by Bayesian structural VARs specified for the individual BRIC (Brazil, Russia, India and China) countries. The results reveal a strong impact of the international economy on GDP growth. However, in contrast to the other countries, China plays a crucial role in determining global trade and oil prices. Therefore, the Chinese economy exerts significant spillovers to the other countries under analysis. The change in the Chinese growth strategy puts additional reform pressure especially in countries with abundant natural resources.     

The effect of oil price shocks on asset markets: Evidence from oil inventory news

We quantify the reaction of U.S. equity, bond futures, and exchange rate returns to oil price shocks driven by oil inventory news. Across most sectors, equity prices decrease in response to higher oil prices before the 2007/2008 crisis but increase after it. Positive oil price shocks cause a depreciation of the U.S. dollar against a broad range of currencies but have only a modest effect on bond futures returns. The evidence suggests that changes in risk premia help to explain the time-varying effect of oil price shocks on U.S. equity returns.     

The influence of customer loyalty on small island economies: an empirical and exploratory study

There is growing consensus that companies' long-term success is reliant on building and sustaining strong customer relationships. This study explores the antecedents of loyalty in business to business (B2Bs) using Guernsey's telecommunication industry as a case study. It examines how these influence customer loyalty orientation and factors that help service providers improve loyalty rates. Extant literature pays little attention to the antecedents of loyalty in small island economies. Prior research focuses on cultural, environmental and macro-economic issues. Drawing on Dick and Basu's (Customer loyalty: Toward an integrated conceptual framework. Journal of the Academy of Marketing Science, 22(Spring), 99–113, 1994) loyalty model, this research explores loyalty antecedents that are cognisant of distinct market conditions that can impact customer loyalty within the telecommunications sector of a small island economy. It seeks to advance understanding of loyalty in B2B relationships in this context and identify factors that contribute towards converting passively loyal customers to being actively loyal customers.     

Macroeconomic fluctuations in the Eastern Caribbean: The role of climatic and external shocks

This article develops country-specific vector autoregressive (VAR) models with block exogeneity restrictions to analyze how exogenous factors affect business cycles in the Eastern Caribbean. It finds that external shocks play a key role, explaining more than half of macroeconomic fluctuations in the region. Domestic business cycles are especially vulnerable to changes in climatic conditions, with a natural disaster leading to an immediate and significant fall in output – but the effects do not appear to be persistent. Oil price and external demand shocks also contribute significantly to domestic macroeconomic fluctuations. An increase in oil prices (external demand) is contractionary (expansionary), and the effects dissipate up to three years after the shock.     

Macroeconomic shocks and the co-movement of stock returns in Latin America

This paper studies the economic sources underlying the co-movement of real stock returns in Latin America. Following the literature on structural vector autoregressive models (SVARs), I use long-run restrictions to identify three structural shocks: demand, supply, and portfolio shocks. For some countries, portfolio shocks are important factors behind real stock returns. Furthermore, these shocks seem to be important in explaining cross-country co-movement patterns. However, these findings are not statistically strong due to the degree of uncertainty about the estimates of the importance of each structural shock and the cross-correlation coefficients. Therefore, macroeconomic shocks (supply and demand) cannot be neglected in accounting for the dynamics of real stock returns.     

Cyclical wage movements in emerging markets compared to developed economies: a general equilibrium comment

I examine distinct cyclical properties of labor markets in emerging economies compared to developed ones from a general equilibrium perspective. The evidence in emerging economies shows that (1) wages are more volatile than income, while (2) employment is less volatile and (3) less pro-cyclical than in developed economies. I use a standard open-economy model to study the implications of wealth effects on labor market dynamics in both emerging and developed economies simultaneously. In contrast to the (partial equilibrium) results of the small open economy (SOE) model, I show that in general equilibrium, strong wealth effects on labor supply in emerging economies are necessary to rationalize the evidence. The model is also consistent with empirical regularities of exchange rate fluctuations, namely (1) excess volatility of real exchange rates, and (2) the negative co-movement between the real exchange rate and relative consumption.     

Convergence of shocks and trade in the enlarged European Union

This paper explores the relation between trade flows and cross-country symmetry of supply and demand shocks using data from the EU-27 countries. Increased bilateral trade intensity is found to have a positive impact on the correlation of both demand and supply shocks. Intra-industry trade is found to be positively linked to correlations of supply-side shocks but negatively linked to correlations of demand shocks. Our results thus provide support for the argument that aggregate demand spillovers and intra-industry trade, rather than specialization, dominate in the process through which trade flows affect the cross-country transmission of shocks in Europe. At the same time, our estimates suggest that monetary-policy convergence in Europe (the circulation of the euro), while having increased symmetry of supply-side shocks, has had no direct favourable impact on symmetry of demand shocks. By contrast, the process of fiscal-policy convergence is found to have resulted in more correlated demand shocks across the EU member states.     

On the sources of business cycles in the G-7

This paper examines sources of cyclical movements in output, inflation and the term structure of interest rates in the G-7. It employs a novel identification approach which uses the sign of the theoretical cross correlation function in response to shocks to catalog orthogonal disturbances. We find that demand shocks are the dominant source of output and inflation fluctuations in several of the G-7 countries. The proportion of term structure variability explained by different structural sources does not depend on the horizon. Apart from the US and Canada, structural shocks are nearly uncorrelated across countries.     

The impact of world oil price shocks on the Canada/U.S. real exchange rate

This article investigates whether and how changes in the world oil price affect the Canada/U.S. real exchange rate. We applied vector autoregression and vector error correction models for the real exchange rate, world oil price, monetary differential, government spending, and productivity differential between the two countries. Our results demonstrate that a surge in the world oil price will lead to an appreciation of the Canadian dollar in the short and long term. Product differentials and U.S. government spending have a negative impact on the Canada/U.S. real exchange rate, and Canadian government spending leads to a depreciation of the Canadian dollar.     

The impact of trade on aggregate productivity and welfare with heterogeneous firms and business cycle uncertainty

This paper presents a model with monopolistic competition, productively heterogeneous firms, and business cycle aggregate shocks. With firm-specific productive heterogeneity, weaker firms quit when faced with a negative aggregate shock. Consequently, trade does not always increase firm-level aggregate productivity as negative shocks on the home market can be compensated for by positive shocks elsewhere. Weaker firms, which would otherwise quit in autarky, can continue to operate by exporting. Despite this, trade can still improve welfare for the risk-averse consumer by reducing aggregate price fluctuations.     

Weathering Tight Economic Times: The Sales Evolution of Consumer Durables Over the Business Cycle

Despite their obvious importance, not much marketing research focuses on how business-cycle fluctuations affect individual companies and/or industries. Often, one only has aggregate information on the state of the national economy, even though cyclical contractions and expansions need not have an equal impact on every industry, nor on all firms in that industry. Using recent time-series developments, we introduce various measures to quantify the extent and nature of business-cycle fluctuations in sales. Specifically, we discuss the concept of cyclical volatility, and derive a dynamic comovement elasticity between the economy as a whole and the cyclical fluctuations in various performance series. To further enhance our understanding of how consumers adjust their purchasing behavior across different phases of the business cycle, two other notable features related, respectively, to the relative size of the peaks and troughs and the rate of change in upward and downward parts of the cycle, are explicitly considered. Of specific interest in this respect are the notion of deepness and steepness asymmetry. We apply these concepts to a broad set (24) of consumer durables, for which we analyze the cyclical sensitivity in their sales evolution. In that way, we (i) derive a novel set of empirical generalizations, and (ii) test different marketing theory-based hypotheses on the underlying drivers of cyclical sensitivity.Consumer durables are found to be more sensitive to business-cycle fluctuations than the general economic activity, as expressed in an average cyclical volatility of more than four times the one in GNP, and an average dynamic comovement elasticity in excess of 2. This observation calls for an explicit consideration of cyclical variation in durable sales. Interestingly, the combined evidence across all durables suggests that asymmetry is present in the speed of up- and downward movements, as durable sales fall much quicker during contractions than they recover during economic expansions. Finally, key variables related to the industrys pricing activities, the nature of the durable (convenience vs. leisure), and the stage in a products life cycle tend to moderate the extent of cyclical sensitivity in durable sales patterns.     

Effects of transitory shocks to aggregate output on consumption in poor countries

This paper provides instrumental variables estimates of the response of aggregate private consumption to transitory output shocks in poor countries. To identify exogenous, unanticipated, idiosyncratic and transitory variations in national output we use year-to-year variations in rainfall as an instrumental variable in a panel of 39 sub-Saharan African countries during the period 1980–2009. Our estimates yield a marginal propensity to consume out of transitory output of around 0.2. To explain this result we show, using instrumental variables techniques, that there is a significant negative effect of transitory output shocks on net current transfers and a significant positive and quantitatively large effect on the trade balance. An important implication is that frictions to private financial flows do not necessarily imply large effects of transitory shocks to aggregate output on private consumption in poor countries.     

三次采油技术的研究现状

本文主要介绍了三次采油技术产生的背景,现有的主要驱油方法及其驱油机理,总结了各类三次驱油中主要的驱油剂,并对未来的三次采油技术发展趋势和亟待解决的问题进行了展望.     

A Nonlinear Model of the Term Structure of Interest Rates

We present an economically motivated two–factor term structure model that generalizes existing stochastic mean term structure models. By allowing a certain parameter to acquire dynamical behavior we extend the two–factor model to obtain a nonlinear three–factor model that is shown, in a deterministic version, to be equivalent to the Lorenz system of differential equations. With reasonable parameter values the model exhibits chaotic behavior. It successfully emulates certain properties of interest rates including cyclical behavior on a business cycle time scale. Estimation and pricing issues are discussed. Standard PCA techniques used to estimate HJM type models are observed to be equivalent to dimensional estimates commonly applied to 'spatial data' in nonlinear systems analysis.
It is concluded that techniques commonly used in the analysis of nonlinear systems may be directly applicable to interest rate models, offering new insights in the development of these models. Tests of nonlinearity in interest rate behavior may need to focus on long cycle times.     

Businessman or host? Individual differences between entrepreneurs and small business owners in the hospitality industry

Prior research has identified individual characteristics that distinguish business owners from non-business owners. The researchers tested their contention that not every successful business owner can be characterized by such typical ‘entrepreneurial’ characteristics. Multiple analysis of variance on a unique data set of 194 business owners in the hospitality industry revealed that several individual characteristics discriminated between entrepreneurs and small business owners. Entrepreneurs possessed higher levels of independence, tolerance of ambiguity, risk-taking propensity, innovativeness, and leadership qualities, but not of market orientation and self-efficacy. It is concluded that ‘entrepreneurial’ characteristics identified in the literature may be useful predicting a specific type of business ownership. However, other criteria need to be developed in order to describe other groups of business owners operating in the service industries.     

Entrepreneurial marketing strategies during the growth of international new ventures originating in small and open economies

This research provides new knowledge on the development of marketing strategies in international new ventures (INVs) by applying the concept of entrepreneurial marketing to these early internationalizing firms. Using a qualitative approach, the authors identify the key dimensions of this concept in INVs, namely innovativeness and adaptation, and elaborate on both the defining elements and the development of these dimensions. They suggest that the innovativeness and adaptation of marketing strategies decrease during the global growth of INVs. Other contextual issues also underlie the development of international entrepreneurial marketing strategies; in particular, they appear to reflect the turbulence and global diversity of the environment and the market orientation of the INV. The marketing performance of INVs is determined by the fit between international entrepreneurial marketing strategies and the internal and external contingencies of the firm. Propositions for future research and managerial implications are provided.     

The feasibility of currency union in Gulf Cooperation Council countries: A business cycle synchronisation view

This paper study the feasibility of a monetary union among Gulf Cooperation Council (GCC) countries, by measuring the evolution of economic integration among them. Considering the critical role of crisis and shocks in the integration process within the region, we determine whether GCC countries are characterised by a common business cycle. We suggest a different empirical approach that, unlike previous studies, allows one to endogenously detect structural changes in the comovement process between outputs. We apply a new measure for this region that is based on the time‐varying coherence function. Such a measure not only detects comovement dynamics but also distinguishes these dynamics in terms of short‐ and long‐term cycles. Additionally, we can test whether certain countries tend to be more synchronised. The main finding of this study is that not all GCC countries share a common short‐term business cycle. However, in the long term, all country‐pairs indicate a medium‐level synchronisation in the most recent subperiods. The new role of the United Arab Emirates’ regional trade platform allows it to strengthen long‐term business cycle comovement, thus differentiating it from other GCC country‐pairs that have shown a decline in the last two subperiods.     

The macroeconomics of commercial policy and the trade balance: A policy perspective

Given the continuing growth of foreign direct investment (FDI) in the United States, there is a growing interest in examining its impact on the rate of economic growth. The immense literature on economic growth in the United States is composed of studies that concentrate on measuring the domestic variables that affect U.S. economic growth. However, the impact of foreign direct investment on the economic growth of the United States has not received the attention that is deserves. The purpose of this study is: (1) to examine the determinants of economic growth in the United States over time, and (2) to see if there is any time-series support for the FDI-led growth hypothesis in the United States. To achieve these goals the study uses a model that is based on the postulates of de Mello. Employing a 40-year period of annual data, the model is estimated by using the Beach Mackinnon technique which corrects for autocorrelation. The estimation results suggest the following conclusions: 1. The major determinants of economic growth in the United States are total factor productivity growth, domestic investment growth, and foreign direct investment growth. 2. Causal relationships between foreign direct investment growth and economic growth is uni-directional, running from foreign direct investment to economic growth. 3. Causal relationships between foreign direct investment growth and total factor productivity growth is uni-directional, running from foreign direct investment to total factor productivity. These findings suggest that foreign direct investment growth has a significant impact on the United States economic growth. Additionally, foreign direct investment has a significant impact on total factor productivity in the United States, further contributing to the United States’ economic growth. This calls on the U.S. policy makers to devise policies that are conducive to increasing the amount of foreign direct investment in this country.     

近年煤焦油市场回顾与后市展望

本文通过对近年煤焦油行业现状及近年价格波动情况进行了深层次分析,指出影响煤焦油价格涨跌的几大重要因素,并提出了一些有利于煤焦油产业有序健康发展的可行性建议.     

The quality of cooking oil used in informal food processing in Malawi: a preliminary study

A survey was conducted in Lilongwe city urban markets in Malawi, to assess the quality of cooking oil used for frying potato chips. Purposive sampling was performed to come up with respondents who were using vegetable oils. A stratified random sampling was used to select the 32 informal food processors who were interviewed using a structured questionnaire. Oil samples were collected from the most commonly used brand of oil. Fifteen respondents were selected and these were divided into three categories of five: those who were not reusing the oil, those who were reusing the oil and those who were preparing potato chips and chicken in the same oil, for chemical analysis. The preliminary results showed that while the majority (59.4%) of the informal food processors discarded the oil after 1 day, 3.1% discarded it after 4 days and another 12.5% after 3 days. A larger proportion of the respondents (40.6%) used the leftover oils at home, 37.5% kept it in oil bottles, 3.1% kept it in plastic papers for reuse the following day. Also, most respondents (57%) indicated dark colour as the sign of oil deterioration, 29% discarded the oil after noticing foam formation while 8.2% and 6.1% said they discarded the oil after noticing a bad smell and food absorbing the oils respectively. A physical observation of the various oils showed that for most of the respondents (34%), the oils were dark brown in colour, in 22%, the oils were slightly dark brown and 16%, the oils were brown. Foam formation was noticed in 13% of the respondents. It was also noted that 91% of the respondents had not been trained or briefed of food quality and safety issues. A chemical analysis of the oils showed high values of free fatty acids (range, 0.84–1.4112 compared with 0.42 in the fresh oil) and peroxide values (range 14.7–16.6 compared with 9.0 in the fresh oil). It may be concluded that the oils being used by the informal food processors in Malawi are of poor quality and so the foods cooked in them may be a health hazard to the consumers and the processors themselves. Although this work in ongoing, it may be recommended at the outset that the health department of the city assemblies should inspect these oils for the good health of the consumers.