Capital Market Equilibrium with Differential Taxation

This paper studies the effect of investor-specific differentialdividend taxation on the dynamics of equilibrium security pricesand allocations. In order to deal with the inherent Paretoinefficiency of such an equilibrium as well as the preclusion oftax arbitrage, we construct a continuous-time equilibrium via arepresentative investor with state-dependent utility. Investorsdiffer in their pricing of risk, inducing investor-specificconsumption-based CAPMs, with differential taxation appearing asan additional factor. The interest rate, stock price, andconsumption dynamics are also impacted. Under logarithmicpreferences, risk is transferred from the higher-taxed to thelower-taxed investor, and the interest rate decreases tocounteract extra precautionary savings against this suboptimallyshared risk. Numerical analysis reveals further tax rate,time-to-horizon, and dividend risk effects on equilibriumquantities. For most wealth allocations, the stock returnvolatility is increased above the no-tax benchmark.     

Collage creation: unexplored potential in tourism research

This paper proposes collage creation as an elicitation tool of underexplored potential in tourism research. Collage creation was employed within an exploratory research investigating the destination image of Jordan. This work focuses on the process of the tool development, and reports the assessment of the tool-related trustworthiness in this specific application. Collage creation emerged to be a valuable tool; it proved efficacious in encouraging participants’ elaboration of thoughts, aiding self-expression, and disclosing preconceptions and stereotypes. Further tool development would benefit both tourism and hospitality research, while applications of the tool may be useful for destination marketing development and renewal.     

Transboundary Pollution in the Black Sea: Comparison of Institutional Arrangements

This paper analyses the transboundary pollution between Romania and Ukraine, coastal states along the Black Sea, and studies the welfare consequences of institutional arrangements for controlling this problem. To achieve this goal, we use a dynamic and strategic framework. We compare in terms of total welfare for two countries a first-best case with three different institutional arrangements: the non-cooperative game of countries, the uniform emission policy and the constant emission policy as proposed by the Black Sea Commission. Our findings indicate that the non-cooperative game provides a better level of total welfare than the other rules.     

Factors Affecting Outbound Tourists' Destination Choice: The Case of Hong Kong

Trip expenditure, length of stay during the trip, size of the travel party, monthly household income, discovering new places and/or things, and getting away from daily routine, role, obligation, stress and troubles have significant influence on Hong Kong residents' destination choice. Hong Kong residents' destination choice is highly associated with trip characteristic in comparison to socio-demographics and travel motivation factors. Destinations close to Hong Kong can focus on packaging their products with shorter trip lengths and making the packages attractive to travel companions in addition to the travelers. Destinations that are relatively far away from Hong Kong should focus on packaging their products to attract the Hong Kong outbound travelers with longer trip lengths and plan activities that cater to individual needs.     

Temporal Changes of Airfares Toward Fixed Departure Date

Despite the existence of numerous published articles that examined the online fares for air-tickets, no prior studies have investigated the issue of temporal changes of airfares toward a fixed departure date. In other words, consumers have no knowledge of when the best time is to purchase their lowest fared air-tickets from the Internet. This study investigated the daily changes of fares for return air-tickets on five online travel agency (OTA) websites with fixed dates of departure during shoulder and high seasons. Empirical findings showed the lowest airfares from Hong Kong to Beijing and Bangkok, representing two most popular short-haul travel destinations, were not found at the initial stage of the data collection period. In other words, consumers should not make online purchase of air-tickets too early.     

The process of technical change in UK manufacturing

This paper tests the validity of the Fisher hypothesis, which establishes a positive relation between interest rates and expected inflation, for the G7 countries and 45 developing economies. For this purpose, we estimate a version of the GARCH specification of the hypothesis for all countries included in the sample. We also test the augmented Fisher relation by including the inflation uncertainty in the equation. The simple Fisher relation holds in all G7 countries but in only 23 developing countries. There is a positive and statistically significant relationship between interest rates and inflation uncertainty for six of the G7 and 18 of the developing countries and this relationship is negative for seven developing countries.     

Robustness of Distance Decay for International Pleasure Travelers: A Longitudinal Approach

Distance decay explains tourism demand in terms of destination distance from the origin. Although travelers tend to travel further over time, scant research studies have examined the relationship between temporal variant and distance decay. This study examines the relationship between distance and destination choice of Hong Kong international pleasure travelers’ activity over a decade. A constant pattern of distance decay with two secondary peaks was identified for a decade. This study suggests a threshold of a three‐hour flight for a five‐day trip before demand declined exponentially. The findings imply that the no traveling zone would result from weak pulling power. Copyright © 2011 John Wiley & Sons, Ltd.     

Incentive Contracts and Environmental Performance Indicators

A principal-agent (P-A) model is used to analyse the effect of environmentaldiligence, the principal (top management), having to use imperfectperformance indicators and fearing penalties for environmental damages,wants to avoid environmental harm and induce the agent (employeemanipulating hazardous materials) to take appropriate action. To motivatethe agent, the principal offers an incentive contract based onenvironmental stewardship performance (as measured by EPI).Environmental stewardship being difficult to measure, due to high levelsof uncertainty surrounding, EPI, creates impediments to the establishmentof an efficient P-A contract.