DIMENSIONALITY AND DISAGREEMENT: ASYMPTOTIC BELIEF DIVERGENCE IN RESPONSE TO COMMON INFORMATION

We provide a model of boundedly rational, multidimensional learning and characterize when beliefs will converge to the truth. Agents maintain beliefs as marginal probabilities instead of joint probabilities, and agents' information is of lower dimension than the model. As a result, for some observations, agents may face an identification problem affecting the role of data in inference. Beliefs converge to the truth when these observations are rare, but beliefs diverge when observations presenting an identification problem are frequent. Robustly, two agents with differing priors who observe identical, unambiguous information may disagree forever, with stronger disagreement the more information received.     

Five Stylized Facts on Belt and Road Countries and Their Trade Patterns

The Belt and Road Initiative (BRI) offers investment opportunities for several Eurasian countries but not all of them attract investments in the same way. This paper investigates the geographical distribution of BRI projects completed between 2013 and 2020. The analysis shows that pre-existing trade patterns are related to the likelihood of a country receiving completed BRI projects. We single out and provide evidence in support of five stylized facts. First, BRI countries with completed projects tend to be poorer and larger. Second, projects are more likely to occur in countries with intense intermediate trade with China. Third, the countries that received projects have more diversified export structures and their sectoral specialization overlaps with that of China. Fourth, among middle-high-income countries, the allocation of projects tends to favor those with high levels of intra-industry trade. Fifth, among BRI countries with projects, the complexity or sophistication of the goods traded increases faster with income. These findings suggest that fostering trade integration has direct benefits and may also contribute to further BRI investments.     

Financial inclusion and food insecurity: Examining linkages and potential pathways

Considering the worsening levels of food insecurity globally, studies exploring the link between financial inclusion and food insecurity have become imperative. This paper contributes to the literature by examining the effect of financial inclusion on food insecurity using a multidimensional index of financial inclusion and a food insecurity construct obtained from the Food Insecurity Experience Scale. Based on data extracted from the seventh round of the Ghana Living Standards Survey, our preferred endogeneity-corrected results indicate that improvements in financial inclusion is associated with a reduction in food insecurity. This finding is consistent across different conceptualisations of food insecurity, alternative weighting schemes and cut-offs for the financial inclusion index and different quasi-experimental methods. Financial inclusion is mainly effective in reducing food insecurity in male-headed and rural-located households. Our findings reveal that entrepreneurship is an important pathway through which financial inclusion influences food insecurity.     

Development and Validation of Consumers' Need for Ingredient Authenticity (CNIA Scale)

ABSTRACT

Concepts from country-of-origin, the authenticity concept, and ingredient branding make up the essential literature for this scale development. This study intends to develop a scale specifically to measure consumers' motivation to seek for ingredient authenticity. While studies on authenticity have heavily looked into brands, this study aims to uncover consumers' motivations of ingredient authenticity of the raw materials and artisan skills of the products. Four studies were undertaken to develop and validate this scale. The research adopted the Churchill's (1979) method of scale development. The methods for scale development and its implications are also highlighted.     

Revisiting Country Image – Examining the Determinants towards Consumers' Purchase Intention of High Technological Products

ABSTRACT

The purpose of this study is to investigate consumers' perceptions towards a developed country image (e.g. USA) and a developing country image (e.g. China) in relation to evaluating and buying high technological products, more specifically, smartphones. In addition, the research also examines the effects of consumer aspirations and product knowledge as consumption traits towards buying behavior. A self-administered questionnaire was employed for this study using established scales with the questions formulated around two countries, USA and China. It was administered through a mall intercept method and a particular focus will be associated to the comparison of China and USA. The stark contrast between the two countries in terms of their image and stature presents an insightful inquiry into the relevancy of country image and country of origin image importance in modern day context. The results show that country image as an evaluation cue is still pertinent in a generation where globalization is present. Results further highlights that although possessing a positive country image leads to a positive evaluation of the product country image, it however does not ensure a successful purchasing intent. Additionally, it is beneficial to note that the results for both USA/IPhone and China/Xiaomi showed a significantly greater path coefficient as compared to other causal paths. Potential moderating factors such as product involvement or pricing can also be explored. Future research should attempt to account for socio economic or demographic factors such as important controls for education, social status and income that are bound to impact on the relationships at the heart of the proposed research hypotheses.     

Time-varying parameters in the almost ideal demand system and the Rotterdam model: will the best specification please stand up?

This article assesses the ability of the Rotterdam Model (RM) and of three versions of the Almost Ideal Demand System (AIDS) to recover the time-varying elasticities of a true demand system and to satisfy theoretical regularity. Using Monte Carlo simulations, we find that the RM performs better than the linear-approximate AIDS at recovering the signs of all the time-varying elasticities. More importantly, the RM has the ability to track the paths of time-varying income elasticities, even when the true values are very high. The linear-approximate AIDS, not only performs poorly at recovering the time-varying elasticities but also badly approximates the nonlinear AIDS.     

Pushing Economies (and Students) Outside the Factor Price Equalization Zone

Despite overwhelming empirical evidence of the failure of factor price equalization, most teaching of international trade theory (even at the graduate level) assumes that economies are incompletely specialized and that factor price equalization holds. The behavior of trading economies in the absence of factor price equalization is not well understood, and some major textbook treatments err. The authors map regions of specialization and diversification for standard competitive economies and show how outputs, goods, and factor prices change as economies move within and across different regions of diversification and specialization. Two examples of how the analysis can enrich graduate-level trade teaching are given: the substitutability of goods trade and factor movements, and debates over the trade and inequality.     

Financial Inclusion in Rural Uganda: Testing Interaction Effect of Financial Literacy and Networks

ABSTRACT

Based on the premise that financial literacy take place in networks to influence the level of financial inclusion, the study examined whether networks moderate in the relationship between financial literacy and financial inclusion among poor households in rural Uganda. Studies have revealed that financial literacy affects the level of financial inclusion. However, these studies have failed to incorporate the moderating role of networks in the relationship between financial literacy and financial inclusion. The results showed that networks positively and significantly moderates in the relationship between financial literacy and financial inclusion with both financial literacy and networks having direct and significant effects.     

Co-creating Value in the Dyadic Relationships of Small and Large Firms in the Agri-food Sector

Given the increasing interest in the process of how value is co-created through interaction in business relationships, this paper examines the areas of collaboration, value co-creation practices and the respective co-created value in the dyadic relationships. Multiple case studies design involving in-depth interviews were undertaken with small and medium-sized suppliers (SMEs) of organic food in South West England with the dyadic relationship being the unit of analysis. The findings suggest that SME suppliers and their larger customers collaborate in many areas including: innovation, corporate social responsibility, planning and interactive learning. The collaboration led to co-creation of monetary and non-monetary values. This research advances the extant literature on value co-creation in business relationships by examining this complex phenomenon in the context of small and large firms’ dyads in the organic food sector. It is novel in identifying the linkage of the co-created value to the respective value co-creation practices and collaborative areas.