Does money impede convergence?

Inspired by Clower’s conjecture that the necessity of trading through money in monetised economies might hinder convergence to competitive equilibrium, and hence, for example, cause unemployment, we experimentally investigate behaviour in markets where trading has to be done through money. In order to evaluate the properties of these markets, we compare their behaviour to behaviour in markets without money, where money cannot intervene. As the trading mechanism might be a compounding factor, we investigate two kinds of market mechanism: the double auction, where bids, asks and trades take place in continuous time throughout a trading period; and the clearing house, where bids and asks are placed once in a trading period, and which are then cleared by an aggregating device. We thus have four treatments, the pairwise combinations of non-monetised/monetised trading with double auction/clearing house. We find that: convergence is faster under non-monetised trading, implying that the necessity of using money to facilitate trade hinders convergence; that monetised trading is noisier than non-monetised trading; and that the volume of trade and realised surpluses are higher with the double auction than the clearing house. As far as efficiency is concerned, monetised trading lowers both informational and allocational efficiency, and while the double auction outperforms the clearing house in terms of allocational efficiency, the clearing house is marginally better than the double auction in terms of informational efficiency when trade is through money. Crucially we confirm the conjecture that inspired these experiments: that the necessity to use money in trading hinders convergence to competitive equilibrium, lowers realised trades and surpluses, and hence may cause unemployment.     

Worker Appropriation as Responsibility and Right

Discussion of worker rights often focuses on the right to associate freely and bargain collectively. Such rights may not be achievable in globalized labor markets when workers do not appropriate the value they add. Relationships in which workers either participate in the management of the enterprise or directly appropriate their own surplus are more common than is generally understood. Recent work in economic philosophy provides an inalienable right for workers to collectively appropriate the fruits of their labor. Given the general failure of existing corporate governance systems, the case for worker appropriation as both responsibility and right is both practical and strong.     

Gender Differences in Managerial Attitudes Towards Unearned Privilege and Favoritism in the Retail Sector

This paper describes the concepts of unearned privilege and favoritism and tests if there are differences in managerial attitudes towards the use of these behaviors based on respondent gender. Respondents included 180 managers employed with a large retail organization located in the southern part of the United States. The results indicate that female managers more strongly disapproved of the use of unearned privilege in making promotion decisions and more strongly disapproved of the decision to use favoritism in decision making related to customer relations. The results also indicated that male managers were less likely to disapprove of the use of unearned privilege when they had greater years of management experience. In addition, the most experienced female managers reported disapproval levels for the use favoritism in decision making related to customer relations equal to that of the most experienced male managers.     

The Regime Switching Portfolios

In this paper we develop a portfolio selection theory under regime switching means and volatilities. We use log mean-variance as the portfolio selection criteria and, as a result, the theory is made substantially easier to implement than other existing theories. Moreover, the estimated regimes are easy to interpret as one of the regimes corresponds to the business cycle turning points. Finally, we conduct an asset allocation simulation and obtain reasonable results by introducing an idea of switching volatility targets.     

The contextual relevance effect on financial advertising

The contextual relevance effect is an important factor for the effectiveness of financial services advertising that corresponds to the message effects such as ad recall (R_AD), perceived contextual relevance (PCR), message involvement (MI) and attitude towards the ad (A_AD), created during the process. Thus, this study examines whether the contextual relevance effect increases R_AD, PCR, MI and A_AD. The results reveal that the contextual relevance effect increases R_AD, PCR, MI and A_AD. Moreover, MI mediates PCR on A_AD. Implications based on the findings demonstrate the importance of contextual relevance as a metric for financial services advertising effectiveness.     

The implications of the FTC's clear and conspicuous standards for the communication of credit card information to young consumers

College students are an important target market for credit card companies and are substantial users of this form of credit, even though they may not have the appropriate knowledge to make informed decisions regarding credit cards. Specific to financial services marketing, the focus of this study is to ascertain whether college-age students recall and understand disclosed information in credit card commercials. This study analyzes the effectiveness of three disclosure standards advocated by the Federal Trade Commission (FTC) which are intended to ensure that consumers (such as college students) are appropriately informed. Specifically, this study focuses on: (1) modality, (2) audience consideration and (3) distraction level present during the disclosure presentation. Tests of the impact of these standards on consumer recall and comprehension of disclosed information have been mixed and the extant research has failed to test all of the standards in combination. An important contribution that this research makes is the reconciliation of differences found in previous research, while revealing the effects that implementing multiple FTC standards has on college students’ recall and comprehension, perceptions of recall and comprehension, and attitudes and behavioral intentions.     

Financial services ads and viewer response profiles: Psychometric properties of a shortened scale

Schlinger's Viewer Response Profile is a widely used tool in advertising research, in both commercial and academic environments. It is used in ad testing to gauge viewer reactions to television commercials. Initial research on its psychometric properties was critical of the scale; however, more recent work using more sophisticated statistical techniques and larger, more realistic, samples has been much more complimentary. This article reports on the use of a shorter version of the Schlinger scale to test financial services advertisements. The findings generally indicate that the scale can be used with confidence in that environment, and that the shorter scale generally performed well. The limitations of the study are acknowledged, managerial implications are discussed, and avenues for future research are identified.     

An empirical investigation of the relative effect of trust and switching costs on service loyalty in the UK retail banking industry

The crisis in the UK financial services industry has led to retail banking customers treating transactions with growing scepticism. Retail banks are having to work very hard to regain customer trust. Despite recent research in marketing that acknowledges the importance of service loyalty to service firms, studies that have examined the relative effects of trust and the different types of switching costs on attitudinal and behavioural loyalty are scant. Therefore this article aims to build a model to examine the strength of the relationships between these constructs. Using survey data collected from a convenience sample of 290 retail banking customers in the United Kingdom, the article reveals that the main drivers of attitudinal loyalty are trust and relational switching costs. In contrast, the main drivers of behavioural loyalty are trust, relational switching costs and attitudinal loyalty. Interestingly, financial and procedural switching costs exert no significant effect on either attitudinal or behavioural loyalty. Trust and relational switching costs exert a stronger effect on attitudinal than behavioural loyalty.