Trends and cycles of the internet evolution and worldwide impacts

In this paper we present a quantitative analysis of the evolution of some Internet and ICT evolution indicators. It focuses on the number of Internet hosts, the Internet penetration index, the ICT development index and the software/protocols development. In addition, we analyzed the series of most impacting events building up the Internet along the last fifty years. These analyses were carried out using the multi-logistic procedure recently proposed by the authors. Our results for hosts counting, penetration index and software/protocols development are compatible with the onset of some radical changes in the Internet technology to be currently underway and we forecast new growth rate peaks to occur by 2015. The software/protocols were found to having been powered by bursts of creativity with periods of the order of the Kuznets and Kondratiev economic cycles. Similar conclusions were drawn from the series of main events building up the Internet. Despite the clear signs of worldwide improvement in the ICT infrastructure and usage between 2002 and 2007 obtained from the ICT development index, its cross-correlation with the human development index (HDI) revealed the presence of a group of countries whose improvements in the operational ICT index are disconnected from their corresponding HDI improvements.     

Macrodynamics of debt regimes, financial instability and growth

This paper develops a post-Keynesian dynamic model of capacityutilisation and growth, in which the supply of credit-moneyis endogenous and firms' debt position—and thus the financialfragility of the economy à la Hyman Minsky—is explicitlymodelled. The interest rate is set by banks as a markup overa base rate exogenously determined by the monetary authority.The banking markup varies with changes in capacity utilisation,while the debt ratio varies with changes in the rates of interest,capital accumulation and growth. Regarding dynamics, it is shownthe possibility of relating the stability properties of a systemwith the interest rate and the debt ratio as state variablesto the prevailing Minskyan regime—hedge, speculative orPonzi.     

Intangible assets and value relevance: Evidence from the Portuguese stock exchange

We assess the value relevance of the amounts for identifiable intangible assets and goodwill reported in the financial statements of all non-finance companies listed on the main market of the Portuguese Stock Exchange from 1998 to 2008. Additionally, we use panel data to explore the impact on value relevance of Portugal’s formal adoption of International Accounting Standards [IAS] and International Financial Reporting Standards [IFRS] in 2005. A distinctive feature of the accounting by our sample companies is that when they adopted IAS 38 and IFRS 3 in 2005, they were no longer required to recognise some intangible assets (such as start-up costs and research expenditures) and were no longer required to amortise goodwill.We find that net earnings, reported goodwill and other intangible assets are highly significantly associated with stock price. However, whereas earnings are related positively to stock prices when Portuguese Generally Accepted Accounting Principles (GAAP) were applied prior to 2005, the value relevance of earnings appears to have declined after the adoption of IAS/IFRS in 2005. Although the change to IAS/IFRS had no impact on the value relevance of identifiable intangibles as a whole, the evidence suggests that there was a positive effect on the value relevance of goodwill. When the subclasses of identifiable intangible assets are considered, we found evidence of an increase in value relevance of goodwill, other intangible assets, and research and development expenditures.     

Local persistence and the PPP hypothesis

This paper examines the statistical properties of the bilateral real exchange rates of the U.S. vs. France, Germany, and the U.K. during the Post-Bretton-Woods period, and draws implications on the Purchasing Power Parity (PPP) hypothesis. Contrary to traditional studies that consider only unit root and stationary processes to describe the real exchange rate behavior, this paper considers an in-between process, the locally persistent process. The empirical results demonstrate the following two findings: (1) Locally persistent processes describe the real exchange rate movements better than unit root and stationary processes, which implies that PPP reversion occurs and PPP holds in the long-run. (2) The confidence intervals for half-life deviations from PPP under local persistence tend to be narrower than those obtained by assuming the ADF and the local-to-unity models.     

Firm Size Distribution and Growth*

Abstract Empirical documentation of the sectoral distribution of firm size for a set of European countries reveals substantial differences. We study the relationship between productivity growth at the industry level and size structure. A positive and robust relation is found between average firm size and growth. We ask why size should matter for growth by considering the role of innovation to construct a test based on the differential effect of size on growth according to various indicators of R&D intensity. Our results indicate that larger size fosters productivity growth because it allows firms to take advantage of all the increasing returns associated with R&D. We argue that our test can be interpreted as a test of reverse causality, which lends support to the view that firm size has a causal impact on growth.     

Antecedents of Perceived Value and Repurchase Intention of Organic Food

The rise of the natural and organic products market follows a global trend of increasing demand largely due to the growth of environmental awareness and the concern of having a healthier diet. Thus, the objective of this study is to propose and test a theoretical model based on antecedent constructs of perceived value and repurchase intention on the consumption of organic products. The results, based on 256 consumers of organic products, confirm the positive relationship between environmental awareness and perceived quality, healthy consumption, and perceived price fairness. Moreover, they underpin the influence of healthy consumption, perceived price fairness and perceived quality on perceived value, and lastly, the influence of perceived value on repurchase intention. Therefore, this study can help practitioners and consumers comprehend in a more systematic way the buying behaviour of this food category.     

A panel data approach to economic forecasting: The bias-corrected average forecast

In this paper, we propose a novel approach to econometric forecasting of stationary and ergodic time series within a panel-data framework. Our key element is to employ the (feasible) bias-corrected average forecast. Using panel-data sequential asymptotics we show that it is potentially superior to other techniques in several contexts. In particular, it is asymptotically equivalent to the conditional expectation, i.e., has an optimal limiting mean-squared error. We also develop a zero-mean test for the average bias and discuss the forecast-combination puzzle in small and large samples. Monte-Carlo simulations are conducted to evaluate the performance of the feasible bias-corrected average forecast in finite samples. An empirical exercise, based upon data from a well known survey is also presented. Overall, these results show promise for the feasible bias-corrected average forecast.     

Uncertainty and the slowdown of capital accumulation in Europe

The slowdown in the process of capital formation in continental Europe in the 1990s is analysed. Sector-level data from the OECD's International Sectoral Data Base (ISDB) are used. Econometric estimates of an investment function indicate structural instability in the early 1990s and, specifically, a break in the coefficient linking the growth of capital stock to demand. This result neither seems to be related to non-linearities in the relationship between capital formation and expected demand, nor to the sectoral composition of European economies. Evidence is found that the drop in the accelerator is at least partly attributable to greater demand uncertainty in the 1990s as compared with the earlier period.