THE DETERMINANTS OF PRICE IN ONLINE AUCTIONS: MORE EVIDENCE FROM QUANTILE REGRESSION

This study explores how seller reputations affect auction prices and concludes that earlier findings may be biased due to the misspecification of seller reputation. This paper contributes to the literature by offering significant empirical evidence using Taiwanese internet auction data. Our study reveals that the influence of seller reputations on auction prices is significant, irrespective of the assumptions of linear or non‐linear relationships with price. However, failure to consider the non‐linear setting of seller reputation leads us to underestimate the impact of reputation when the seller's reputation score is low, but overestimates it when the seller's reputation becomes high. Using quantile regression, this study finds evidence of considerable differences in their impact on auction prices that are dependent on the distribution of price levels.     

Revisiting purchasing power parity in Latin America: sequential panel selection method

This study applies the Sequential Panel Selection Method (SPSM), proposed by Chortareas and Kapetanios (2009) to test the validity of long-run purchasing power parity (PPP) in a sample of 15 Latin American countries using monthly data spanning from December 1994 to February 2010. SPSM classifies the whole panel into a group of stationary and nonstationary series. In doing so, we can clearly identify how many and which series in the panel are stationary processes. Empirical results from the SPSM using the Panel KSS unit root test (Ucar and Omay, 2009) with a Fourier function which accounts for any structural break in the data indicate that PPP holds in many of the Latin American countries studied.     

LABOR‐MARKET FRICTIONS,HUMAN CAPITAL ACCUMULATION,AND LONG‐RUN GROWTH: POSITIVE ANALYSIS AND POLICY EVALUATION*

We construct a search model with endogenous human capital and labor participation to study the growth effects of short‐run frictions and the effectiveness of human capital policies. Employment, learning effort, and output growth increase with more effective learning, better labor‐market matching, lower job separation, or less costly vacancy creation. Although output growth, employment, vacancy creation, and learning and search effort are most responsive to changes in a human capital policy that directly affects learning effort, such a policy need not be more beneficial for welfare. The effects of human capital policies become larger as the severity of labor‐market frictions rises.     

The Use of Debt Covenants Worldwide: Institutional Determinants and Implications on Financial Reporting

This study investigates how the use of debt covenants around the world varies with legal institutions. On the basis of syndicated loans in 36 countries, we find that debt covenants are more prevalent in countries with stronger law enforcement and weaker creditor rights, suggesting that law enforcement facilitates, and creditor rights substitute for, the use of covenants. We also find that the substitution effect between covenant use and creditor rights exists mainly in countries with strong law enforcement, and the effect of legal institutions on covenants is primarily driven by covenants that preserve seniority and capital. In addition, timely loss recognition increases with the use of debt covenants and strong creditor rights attenuate this relation. Overall, our study is the first to provide comprehensive evidence on how the use of debt covenants responds to legal institutions and how it bridges the previously documented link between legal institutions and accounting conservatism.     

Non-productive consumption loans and threshold effects in the inflation-growth relationship

Recent empirical evidence indicates that two inflation thresholdsexist in the inflation-growth relationship. Pre-existing theoreticalmodels, however, fail to generate such a pattern. By addingconsumption loans (which are non-productive) into a standardmodel of imperfect information, this paper finds that an increasein the inflation rate may increase, decrease, or have no significanteffect on economic growth for inflation rates below a thresholdlevel; however, for inflation rates higher than this thresholdlevel, an increase in the inflation rate significantly reduceseconomic growth. Moreover, the marginal impact of an increasein the inflation rate in terms of reducing economic growth increaseswith the rise in the inflation rate, until the inflation ratesreach the second threshold level, from which such a marginaleffect significantly decreases. These results accord well withrecent empirical evidence.     

POVERTY DYNAMICS DURING TRADE REFORM: EVIDENCE FROM RURAL VIETNAM

This paper implements and adapts the conceptual framework developed by Winters (2002) that identifies the transmission mechanisms between trade policy reform and household welfare outcomes. We make use of household panel data from Vietnam collected in two years, 1992–93 and 1997–98 that span the very earliest years of the reform period and its immediate after effects. Poverty dynamics are modeled using changes in consumption expenditure and poverty transition models. The trade effect is captured by a set of variables that are most likely to have an impact on rural poverty, namely prices of staples and employment in the export sector. We show that trade liberalization has a material and positive effect on rural household welfare and this trade effect is largely transmitted to the poor through the labor market channel.     

LINEX Loss Functions with Applications to Determining the Optimum Process Parameters

In the classical Taguchi quality model, the symmetric quadratic loss function has been used to measure the loss of quality. However, there are a number of situations in which the symmetric quadratic loss may be inappropriate. In this paper, we proposed an asymmetric loss function, called linear exponential (LINEX) loss function, to determine optimum process parameters for the product quality. When the coefficient of LINEX loss function is small, it will be close to the quadratic loss. Moreover, the trade-off problem between quality and cost will be discussed.     

Policy System in Taiwan's Industrial Context

Drawing on institutional analysis of politics, this paper proposes a concept of policy system that is then applied empirically to Taiwan's industrial context of 1986–95. Contemporary political sciences now identify the institutionalization of state-business relations. Accounts differ, but generally they retain a strong sense of conventional rules in the formulation and implementation of industry policy. While taking this idea of rules seriously, we extend institutional perspectives on politics from the familiar confines of structural constraints to the institutional context of resources. Thus, a policy system is socially constructed with a variety of rules and resources, appreciable in the Taiwanese context.     

Entrepreneurs in Turkey: A Factor Analysis of Motivations, Success Factors, and Problems

One hundred and thirty-nine entrepreneurs in Ankara, Turkey were surveyed to determine their motivations for business ownership, the factors contributing to their success, and their problems. Based on survey responses, the primary reasons for starting a business are to increase income, to obtain job security, and to secure independence. According to the factor analysis, small and medium-sized enterprises owners are driven more by income rewards than intrinsic rewards. The most important business success variables are the entrepreneurs' reputation for honesty and friendliness. Social skills and good customer service were also cited as critical success factors. The most serious problem faced by entrepreneurs in Turkey is the complex and confusing tax structure. Other important problems include unreliable employees, the inability to maintain good records, and a weak economy.     

Democracy and Economic Growth: Optimal Level and Transmission Channels

After evening out all the benefits and costs, the overall optimal level of democracy is about 3.2, on a scale of 1 to 7. On average, fully dictatorial countries have a conditioned growth rate of –1.113 percent, fully democratic countries have a conditioned growth rate of 1.146 while countries with the optimal level of democracy/autocracy have a conditioned growth rate of 2.665. In the case of a fully dictatorial country, moving one unit towards democracy can raise the GDP growth rate by about 1.725 points; while for a fully democratic country, moving towards autocracy by one unit can raise the growth rate by about 0.885 points. This study provides useful information for many developing countries which are experiencing substantial pressures to restructure their political system.