Evaluating consumer sentiments as predictors of UK household consumption behavior: Are they accurate and useful?

This paper investigates empirically whether consumer sentiments indices, based on surveys complied by GfK, forecast household consumption types for the UK. Firstly, we use a quantitative equation approach to assess whether the indices are able to forecast household consumption growth in addition to traditional variables, which are included as control variables. Subsequently, using qualitative directional analysis, we investigate whether the indices are accurate and useful predictors as well. We find that, broadly speaking, both the headline, or aggregate, and the major purchasing indices have some predictive powers in addition to the control variables and are also directionally accurate and useful.     

Book reviews

Journal of the Academy of Marketing Science -     

Why elementary price index number formulas differ: Evidence on price dispersion

Most countries use either the Dutot or Jevons index number formula for the compilation of their consumer price index at the elementary level of aggregation. The difference between the formulas is shown to be accounted for by changes in price dispersion. In turn, some of this difference is shown to be explained by product heterogeneity. Scanner data on television sets (TVs) are used to calculate Dutot and Jevons indexes. The difference between them is successfully explained in terms of changes in price dispersion and much reduced using an hedonic, heterogeneity-controlled Dutot index.     

Evidence of Forward-Looking Loan Loss Provisioning with Credit Market Information

Our paper makes a fundamental contribution by studying loan loss provisioning over the credit cycle as three distinct phases. Looking at the three distinct phases of the financial crisis – the pre-crisis period, crisis period, and post-crisis period – is important as loan loss provisioning is driven by different factors in each, in part due to extensive shifts in (or in the application of) regulatory rule. Controlling for credit market information using data from the Senior Loan Officer Opinion Surveys (SLOOS) we extend the work of previous studies of forward-looking loan loss provisions using the delayed expected loss recognition approach. We contribute to the growing literature on forward-looking loan loss provisioning and early in the cycle loss recognition by incorporating a broader range of available credit information and explicitly controlling for structural breaks in the sample corresponding to the financial crisis.     

A causal relationship between trade efficiency and economic efficiency: Evidence from dynamic simultaneous equations models

The objective of this study is to examine the causal relationship between economic efficiency and trade efficiency using dynamic panel data in simultaneous equations models for global panel of 50 countries over the period 2000–2014. The study also implements this interrelationship for two groups of countries based on their level of development. Two models applying different factors reflecting countries’ economic and trade policies are proposed to measure the targeted efficiencies using data envelopment analysis method. Evidence from the simultaneous equations models to identify a relationship between economic efficiency and trade efficiency supports the bidirectional causality between them in all three categories of countries. It has been also found that both economic and institutional factors have a significant positive influence on trade and growth performance, with the effect of political factors being especially pronounced for developing countries that suffer from weak institutional capacity. These empirical findings are of particular interest to policy-makers as they help to build sound policies in order to maximize trade performance as well as economic efficiency.     

Mergers and innovation: evidence from a panel of US firms*

Mergers lead to larger firms and a less competitive market structure, but their effects on innovation are not clear. Mergers may improve innovation incentives by promoting economies of scope and scale, R&D activities, and increasing the ability to deal with uncertainties. However, mergers may also discourage innovation by reducing competition, increasing costs, and decreasing production and R&D efficiencies. In this study, we investigate merger impacts on innovation using a panel data consisting of four different data sets on publicly traded US manufacturing firms from 1980 to 2003. Our proxy for innovation is based on citation-weighted patent stocks. In our estimation model, we control for endogeneity using instrumental variables and factors such as market share, size, industry, and time. We find that mergers are positively and significantly correlated with firms’ innovation. Our findings also indicate that merger effect on innovation is heterogeneous across industries, increases with market share, and is greater in the long run. Our findings are robust to alternative measures of innovation.     

Do Political Connections Affect Firm Performance? Evidence from a Developing Country

We investigate how politicians serving on the boards of directors influence firm performance. The results show a negative relationship between political connections and firm performance. Specifically, politically connected firms underperform nonconnected firms directors by almost 17 percent and 15 percent based on return on assets and return on equity, respectively. By stratifying the sample duration into two periods based on the political environment, we find that this effect is more pronounced in autocratic as opposed to democratic regimes. Finally, our results also suggest that the performance of connected firms with more growth opportunities is not affected by political connections.     

Customer-based brand equity and destination visit behaviour in the tourism industry: the contingent role of social media

Quality & Quantity - This study aims to examine the role of customer-based brand equity (CBBE) in relation to the intention to select a destination as a tourist destination with the moderating...     

Commitment and turnover intention in the UAE oil industry

This paper aims to explore the links between two components of commitment – affective and continuance – and employees' intention to stay/quit in the oil industry. A self-administered questionnaire was used in order to collect study data from 600 employees representing three levels of management. Eight hypotheses were developed such as there is no significant relationship between affective commitment and intention to quit the organization, there is no significant relationship between affective commitment and intention to stay with the organization, there is no significant relationship between personal variables and organizational commitment and its dimensions, and there is no significant relationship between job-related variables and organizational commitment and its dimensions. These hypotheses were examined using various tests drawn from the SPSS program, for example, correlations, factor analysis and multiple regressions. Findings confirmed the multidimensionality nature of commitment. A significant negative relationship between organizational commitment and intention to quit was also reported. The results related to demographic factors and commitment show some evidences that support these links. The implications of the findings for both practitioners and researchers are discussed in the paper with some guidelines for future research in this field.     

A comparison of six sampling schemes for price index construction in a COICOP food group

This article compares the behaviour of sampling techniques for price indices using a scanner data set as a model population. Indices produced by two purposive deterministic cut-off designs and four probabilistic sampling schemes are compared with each other and with the ‘true’ population index from the whole data set. We found that the two deterministic cut-off sampling schemes show much different behaviour from the probabilistic sampling schemes. This is not unexpected, as the former schemes have a very restricted focus with respect to the variety of products. We also found that the probabilistic schemes are generally closer to each other and the ‘true’ value than the deterministic cut-off designs. The jackknife resampling technique is also explored as a means of estimating the SE of the index and compared with the actual results from repeated sampling.