Modeling structural changes in the volatility process

GARCH-type models have been very successful in describing the volatility dynamics of financial return series for short periods of time. However, the time-varying behavior of investors, for example, may cause the structure of volatility to change and the assumption of stationarity is no longer plausible. To deal with this issue, the current paper proposes a conditional volatility model with time-varying coefficients based on a multinomial switching mechanism. By giving more weight to either the persistence or shock term in a GARCH model, conditional on their relative ability to forecast a benchmark volatility measure, the switching reinforces the persistent nature of the GARCH model. The estimation of this benchmark volatility targeting or BVT-GARCH model for Dow 30 stocks indicates that the switching model is able to outperform a number of relevant GARCH setups, both in- and out-of-sample, also without any informational advantages.     

Multihoming, content delivery networks, and the market for Internet connectivity

Peering points between different Internet service providers (ISPs) are among the bottlenecks of the Internet. Multihoming (MH) and content delivery networks (CDNs) are two technical solutions to bypass peering points and to improve the quality of data delivery. So far, however, there is no research that analyzes the economic effects of MH and CDNs on the market for Internet connectivity. This paper develops a static market model with locked-in end users and paid content. It shows that MH and CDNs create the possibility for terminating ISPs to engage in monopolistic pricing towards content providers, leading to a shift of rents from end users and content providers to ISPs. Implications for future innovations are discussed.     

Time-Varying Betas of German Stock Returns

The market model assumes stock returns to be a linear function of the market return. However, there is considerable evidence that the beta stability assumption commonly used when estimating the market model is invalid. In this paper we account for beta instability in German stock returns by allowing the coefficients to vary over time in estimation. For time-varying beta estimation we rely on the Flexible Least Squares approach, the Random Walk Model and Moving Window Least Squares. Due to our results time-varying estimation fits the data considerably better than time-invariant estimation and, hence, increases the efficiency of beta based risk measurement.Acknowledgements: The authors thank Stefan Mittnik, Christian Pigorsch, an anonymous referee and the editor for constructive comments.     

Global Social Media Usage: Insights Into Reaching Consumers Worldwide

This study documents global social media usage patterns based on a large‐scale survey of 4,630 social media users around the world. The study provides insights into how users in the European Union, United States, and BRIC (Brazil, Russia, India, and China) regions use social media for business and personal use. It analyzes variability in global social media platforms being used in these different world regions. The study also presents insights into usage of multilingual content for global social media consumption and the global user propensity to translate social media. Finally, the paper showcases an innovative technology solution to help companies leverage machine and human translation to enable users to translate social media content. © 2012 Wiley Periodicals, Inc.     

Optimal clearing arrangements for financial trades

Clearinghouses support financial trades by keeping records of transactions and by providing liquidity through short-term credit that participants clear periodically. We study efficient clearing arrangements for exchanges, where traders must clear with a clearinghouse, and for over-the-counter (OTC) markets, where traders can clear bilaterally. When clearing is costly, it can be efficient to subsidize OTC clearing by charging a higher clearing price for transactions conducted on exchanges. The clearinghouse then operates across both markets. Since clearinghouses offer credit, intertemporal incentives are needed to ensure settlement. When liquidity costs increase, concerns about default lead to a tightening of liquidity provision.     

Campaign dynamics of cognitive accessibility of political judgments: measuring the impact of campaigns and campaign events using response latencies in two German rolling cross section studies

Do campaigns matter? Based on two rolling cross-section computer-assisted telephone surveys conducted in the run-up to the 2009 and 2013 German Federal Election, we test whether we can detect campaign effects on the accessibility of voters’ judgments: how do response latencies of political judgments evolve over the course of campaigns? The study uses response latencies, i.e. the standardized time it takes respondents to answer a survey question, as a proxy measurement of cognitive accessibility of political judgments. If campaigns do help voters to make up their minds, we should be able to observe changes at the implicit level of response latencies. Do people answer questions about their voting behavior and political attitudes faster as Election Day comes closer? Our results suggest that attitudes towards candidates and voting intentions become more cognitively accessible during campaigns whereas the accessibility of party identification is conditional on the contextual features of campaigns. In addition we find specific short-term effects of TV debates.     

Strategic Communication through Social Media Influencers: Current State of Research and Desiderata

ABSTRACT

This article provides an overview of the current state of research in strategic influencer communication and highlights research desiderata. We conducted a systematic literature review of 39 peer-reviewed articles published between 2011 and 2018. Using Lasswell’s transmission model of communication as an approach to systemize communication acts, we identified, systematized, and synthesized main findings from existing literature. The review reveals a rag rug of fragmented research questions, combined with a lack of theoretical integration and a widespread methodological monism. Moreover, questions related to the implications of influencer communication for strategic planning are understudied. Hence, more research is required to understand underlying cause-and-effect relations and managerial implementation of strategic influencer communication. In conclusion, we encourage researchers to investigate the concept of social media influencer communication from a strategic communication perspective, including applying multidisciplinary approaches and a broader range of empirical methods, which would foster a deeper understanding of strategic influencer communication.     

New development: ‘Healing at a distance’—telemedicine and COVID-19

ABSTRACT

In extreme circumstances such as pandemics, the presence of patients in hospital emergency departments becomes untenable. Healthcare professionals and organizations worldwide are leaning on technology as a crucial ally to deal with the COVID-19 outbreak. This article focuses on the positive impact of telemedicine for helping service provision, from enabling virtual triage to mitigating the negative psychological effects of social isolation. The authors discuss the challenges and opportunities to telemedicine practices.