Partial adjustment without tears: A tale for the tolar

The design of monetary system in Slovenia was influenced by the heritage of peristent shortages of foreign exchange. This and other considerations prompted a decision that a new currncy-Tolar was to float on two separate foreign exchange markets: a market for current account transactios, and a market for capital account transactios. Actual developments differed considerably from forecasts; an abundance prevailed, and the Tolar remained remarkably strong. The aim of the paper is to present, estimate and test a simple model describing the behaviour of the Tolar in the first period of high uncertainty; and to assess its relevance for the real world. Exchange-rate movements are analyzed as if they were adjusting to the expected price level. The results imply that the dealers do not wait for new data on prices to be disclosed; they, howevr, try and anticipate the likely effects of inflation on the exchange rate. It is shown that interventions by the Central Bank did not affect the SIT/DM exchange rate appreciably. The answer to the question whether other Eastern European countries could have benefitted from the short-run story of the tolar, is inconclusive, if not negative.We are grateful to A. Beltratti, A. Brzeski, Ch. Flinn, P. Sgro, H. Wagener and the referees of this Journal for their comments on a preliminary draft of this paper. Part of this work has been carried out while J. Mencinger was a Fellow at ICER, Turin, to which we are both indebted.     

Selecting sustainable electric bus powertrains using multipreference evolutionary algorithms

Constant improvement of vehicle technologies towards more efficient powertrains and reduced pollutant emissions, frequently leads to the increase of the vehicle or fuel costs, compromising its viability. Multi-objective optimization methods are commonly used to solve such problems, finding optimal trade-off solutions relatively conflicting objectives. Nevertheless, vehicle driving performance, is often disregarded from the optimization process or considered only as a fixed constraint. This may raise some issues, which are discussed in this paper: (a) vehicle dynamics are not improved, (b) trade-off optimal solutions are not distinguishable, (c) interesting solutions near constraints limits won´t be considered if constraints are not marginally relaxed.

This paper proposes a method to optimize three electric-drive vehicle options for an urban bus, a battery electric (BEV), a fuel cell hybrid (FC-HEV) and a plug-in hybrid (FC-PHEV), aiming minimum carbon footprint, maximum financial indicator and simultaneously improved driving performance (speed, acceleration, and electric range). The carbon footprint is assessed by a life cycle (LC) approach, considering the impact of the fuel production and use, and vehicle embodied materials; while the financial assessment considers the vehicle and fuel costs. The spherical pruning multi-objective differential evolution algorithm (spMODE-II) is used in the optimization, considering different preference regions within the problem constraints and objectives. The vehicle solutions optimality and suitability are compared with other multi-objective algorithm, NSGA-II.

The FC-HEV achieved the lowest LC emissions (547 g/km), and the FC-PHEV the maximum financial gain (0.19 $/km), while the BEV achieved the best trade-off of solutions.     

Proposition for an improved version of the consumer entitlement inventory

This note proposes an improved version of the Consumer Entitlement Inventory (CEI) developed by Boyd and Helms ( 2005 ). Two studies, conducted in two different cultural settings—France (n = 203) and the United States (n = 181)—raised some issues with the original version of the CEI. The underlying theoretical reasons for these results are discussed and an analysis of the CEI's content validity is performed. An improved version of the CEI, enriched with items that more closely capture the consumer entitlement construct, is proposed. © 2010 Wiley Periodicals, Inc.     

Is the Virtual Integration of Financial Markets Beneficial in Emerging Markets? Evidence from MILA

This article analyzes whether the Latin American Integrated Market (MILA) has been beneficial for its participants. Using a dynamic conditional correlation (DCC) model proposed by Engle (2002), we found evidence that creating MILA increased the correlation levels in stock returns of member countries. Evidence indicates that this increase occurs mainly due to the increase in traded volume in the country with the least developed stock market—Peru.

In short, findings suggest that in an integration process such as MILA, as stock market members differ, in terms of stock market development, the markets will benefit from the integration. However, in the long term these benefits dissipate over time.     

Change of numeraire in the two-marginals martingale transport problem

In this paper, we apply change of numeraire techniques to the optimal transport approach for computing model-free prices of derivatives in a two-period setting. In particular, we consider the optimal transport plan constructed in Hobson and Klimmek (Finance Stoch. 19:189–214, 2015) as well as the one introduced in Beiglböck and Juillet (Ann. Probab. 44:42–106, 2016) and further studied in Henry-Labordère and Touzi (Finance Stoch. 20:635–668, 2016). We show that in the case of positive martingales, a suitable change of numeraire applied to Hobson and Klimmek (Finance Stoch. 19:189–214, 2015) exchanges forward start straddles of type I and type II, so that the optimal transport plan in the subhedging problems is the same for both types of options. Moreover, for Henry-Labordère and Touzi’s (Finance Stoch. 20:635–668, 2016) construction, the right-monotone transference plan can be viewed as a mirror coupling of its left counterpart under the change of numeraire.     

Heterogeneous student perceptions of accounting course importance and their implications for SET reporting and use

This research tests for an association between student perceptions of accounting course importance (PCI) and student evaluation of teaching (SET) ratings of satisfaction with instructor performance, course quality, and grading procedures. The study also investigates whether instructor rankings constructed from SET ratings vary across student groupings based on PCI. Using responses from students enrolled in introductory accounting classes at three AACSB-accredited accounting programs we find that SET ratings vary significantly with PCI. We also find that instructor rankings constructed from SET ratings vary with PCI. These findings suggest that, when heterogeneous perceptions are present, satisfying all students enrolled in a course may not be possible and that reliance on aggregated SET data may obscure important differences in student opinion. In this circumstance, disaggregating SET data by PCI and emphasizing the feedback of students holding higher (stronger) perceptions of course importance may enhance SET diagnostic value.     

Have Unions Turned the Corner? New Evidence on Recent Trends in Union Recognition in UK Firms

This paper reports results from a recent survey conducted on unionization in over 650 firms in the private sector in the UK. The survey shows that since 1997 there has been a slight fall in derecognition, but a relatively large increase in union recognition. This increase in new recognition agreements is consistent with the idea that the incoming Labour government had a positive effect on the ability of unions to gain recognition, either through the 1999 legislation or more indirectly through changing the political climate.     

Asset pricing with skewed-normal return

Despite the fact that it is easy to see intuitively why skewness and coskewness should matter for asset pricing, it is difficult to build a model that links analytically skewness premia to deep structural parameters governing preferences and the distribution of shocks. This paper takes up the challenge and studies the effect of skewness and coskewness on asset valuation. To reach this important goal, asset returns skewness is modeled with promising Azzalini’s [1985. Scandinavian Journal of Statistics 12, 171–178] skew-normal distribution. With this assumption, we are now able to derive explicit expressions of assets skewness premiums and to shed a new light on asset valuation.     

Dynamic complex hedging in additive markets

In general, geometric additive models are incomplete and the perfect replication of derivatives, in the usual sense, is not possible. In this paper we complete the market by introducing the so-called power-jump assets. Using a static hedging formula, in order to relate call options and power-jump assets, we show that this market can also be completed by considering portfolios with a continuum of call options with different strikes and the same maturity.