Single Versus Multi-market Approach: An Application to the Greek Cotton Market

Estimation of the price-induced welfare effects in vertical and horizontal market settings may prove a tricky task when multiple price changes are taken into account. Whether a multi-market sequential approach or a single-market approach is used the well-established, theoretical result suggests that these two partial equilibrium methods are equivalent in terms of implied welfare changes. This paper develops the methodology to empirically compare these two methods. We estimate the welfare changes to Greek cotton–yarn producers induced by the simultaneous change in the prices of cotton–yarn and the cost of labor. Results substantiate the multi-market approach offers more accurate welfare estimates than the single-market approach, in empirical work.

Exchange Rate Uncertainty, Sociopolitical Instability and Private Investment: Empirical Evidence from Latin America

Using exchange rate uncertainty (ERU) and sociopolitical instability (SPI) as measures of macroeconomic imbalances and political disorder, respectively, we investigate the link between these two factors and private investment in Latin America. The analysis shows that while ERU and SPI negatively impact private investment jointly, the individual impact of ERU is much greater than that of SPI. Our results should prove useful both to policymakers and others interested in understanding the impact of uncertainty on private investment. Most importantly, macroeconomic policies that limit excess volatility in relative prices should lessen an economy’s general level of investment risk leading to enhanced private investment. Further, though lesser in degree, institutional reforms that reduce social tensions and strengthen property rights should also stimulate private investment. Finally, structural reforms that combine these two are likely to foster a robust market for private investment thus contributing to an economy’s growth potential.     

Environmental Degradation,Longevity, and the Dynamics of Economic Development

I construct a two-period overlapping generations model in which longevity is positively affected by public spending on health services and negatively affected by pollution. It is shown that the parameters which determine the extent of environmental degradation (i.e., emission rate and pollution abatement) may also represent additional factors affecting the dynamics of the economy, the likelihood of multiple (non-trivial) steady-state equilibria and the emergence of poverty traps. The distribution of public spending between public health care and pollution abatement that maximizes equilibrium income is also derived. This distribution of spending minimizes the threshold which the economy needs to surpass in order to avoid a poverty trap while, under certain circumstances, it can maximize equilibrium welfare as well.     

The effect of board composition on the informativeness and quality of annual earnings: Empirical evidence from Greece

This study examines how the informational quality of annual accounting earnings, varies according to the size and composition of the board of directors of publicly listed firms within the Greek capital market. Data analysis over a period of five years (2000-2004) revealed that the informativeness of annual accounting earnings is positively related to the fraction of outside directors serving on the board, but it is not related to board size. Additionally, firms with a higher proportion of outside board members proved to be more conservative when reporting bad news but on the contrary they do not display greater timeliness on the recognition of good news. Finally, firms with a higher proportion of outside directors report earnings of higher quality compared to firms with a low proportion of outside directors. Our results are robust to several sensitivity tests controlling for endogeneity, firm's fixed effects and alternative models for the estimation of discretionary accruals.     

The Behaviour of Banking Stocks During the Financial Crisis and Recessions. Evidence from Changes‐in‐Changes Panel Data Estimations

This paper examines the impact of the financial crisis and economic recessions on bank shares compared to the overall stock market index for 18 OECD countries from 1993 to 2015. The empirical methodology utilizes the changes‐in‐changes approach. We compare and contrast the returns of the banking stock price index (treatment group) in each country with their general stock price index (control group), which experiences smaller changes. Our results suggest that bank returns on average perform significantly worse than that of the general stock price index during recessions. In addition, we also find significantly greater volatility in bank share returns.     

Intertemporal asset pricing with bitcoin

Review of Quantitative Finance and Accounting - This paper develops and tests an intertemporal regime-switching asset pricing model characterized by heterogeneous agents that have different...     

International and domestic tourists’ “a priori” and “in situ” image differences and the impact of direct destination experience on destination image: the case of Linz,Austria

A profound understanding of destination image and its determinants is of significance for destinations aiming to effectively position themselves in the tourism market. However, existing research on destination image formation has mainly focused on the “a priori” and “a posteriori” stages and paid only limited attention to the “in situ” stage. To fill in this gap, this study examines the effect direct destination experience and visitors’ nationality (domestic vs. international) have on both “pre-travel” and “in situ” cognitive and affective elements of image. The study was conducted using 400 international and domestic visitors to Linz, Austria. The findings indicate that there are significant differences in the way domestic and international tourists perceive Linz as a tourist destination both prior and during the actual experience. The study also provides empirical evidence that direct destination experience plays a major role in destination image formation, irrespective of individual’s nationality. The theoretical and practical implications of these findings are also discussed.     

Annual report readability and stock liquidity

We examine the effect of annual report textual complexity on firms’ stock liquidity. Using techniques from computational linguistics, we predict and find that less readable filings are associated with lower stock liquidity. Our study provides evidence that difficult‐to‐read annual reports hinder investors’ ability to process and analyze information contained in corporate annual reports, reducing thereby their willingness to trade which decreases stock liquidity. Our findings are robust to a battery of sensitivity tests, including endogeneity, use of alternative estimation techniques, and use of alternative liquidity and readability proxies.