Consumer demand by Black Americans

This article investigates the consumption patterns of black Americans for five different commodity groups: food, housing, clothing, health care, and transportation. The black consumer’s demand for these products is hypothesized as describable by the linear expenditure system. The system allows the investigation of changing relative commodity prices and income. The system also establishes a basic consumption bundle as an estimable parameter of the system. The basic bundle allows for changes in composition due to increased product familiarity, habit formation, and emulation by black consumers. Product familiarity and habit-formation play a role in determining the black consumer’s demand for the commodities food, housing, and clothing. This demand is also partially determined by the consumer’s “emulation” of consumption standards established by society in general. The article is not a comparison study of black-white differences in consumer behavior; however, the possible existence of an emulation effect in black consumer behavior suggests an interrelation of black-white consumer welfare which might fruitfully be studied by future researchers.     

TO TAX OR NOT TO TAX? THE CASE OF ELECTRONIC COMMERCE

Despite the intensifying debate over the taxation of Internet commerce, the relevant issues have not been given a systematic treatment in the context of the literature on optimal taxation. This article presents such an analysis and investigates separately the taxation of business purchases of intermediate goods, the taxation of consumer purchases of final goods and services, and the various issues of administration and compliance costs as they apply to the development of E-commerce. The authors conclude that generally the optimal tax literature cannot be used in support of a blanket tax exemption for Internet purchases. Certain conditions could lead to the optimality of an exemption, but those conditions are not likely to be met in practice.     

CEOs who have COOs: contingency analysis of an unexplored structural form

We use contingency theory to examine, for the first time, the incidence and effectiveness of CEO/COO duos. We argue that industry dynamism, extraordinary organizational task demands, and the CEO's own professional limitations will influence the decision to have a COO, as well as its effect on performance. Based on a large 10‐year sample, we find some support for the contingency view in explaining the presence of COOs; we particularly find that CEOs who lack experience in operational activities and in managing the focal firm are relatively likely to have COOs. We find, however, essentially no support for the contingency view in explaining when COOs are most beneficial. Instead, we find strong evidence of a very substantial negative main effect: CEOs who have COOs deliver lower organizational performance than those who do not. Copyright © 2004 John Wiley & Sons, Ltd.     

Fertility and Economic Growth: Do Immigrant Maids Play a Role?

A significant source of child-care services in East and South-East Asia are provided by immigrant maids. Using a modified version of the model used in Galor and Weil (1996), the present paper analyses the impact of this source of child-care services on women's labor market participation, fertility behavior and the household purchase of child-care services. The results show that a lower price for the maid service leads to a lower savings rate, a higher demand for children and less time being spent with children. We also find that hiring immigrant maids leads to lower economic growth in the long run.     

Environmental social controls and capital investments: Australian evidence

Environmental social controls (ESCs) such as mandatory disclosure, regulations, subsidies, and stakeholder opinion are intended to improve firm environmental performance. This paper reports ESC importance to Australian financial managers in making capital investment decisions. A decision‐making experiment showed managers to be most responsive to stakeholder opinion (42 per cent), followed by subsidization (26 per cent) and regulatory cost (22 per cent). Mandatory disclosure has very little influence (10 per cent). ESC interaction effects are limited so coordination of ESC policy is not a primary concern. High degrees of managerial self‐insight suggest policy changes would be enhanced by close consultations with the managers involved.     

Some Economics of Integrated and Segmented Markets

For the purposes of the discussion in this paper, whether markets are integrated or segmented is endogenous and is determined by the interaction of demand parameters, tariffs, transportation costs, and arbitrage. Given certain restrictions, it is shown, in equilibrium, that policymakers choose tariffs to segment markets. The effects of trade liberalization (reducing all tariffs to zero) in an endogenous market structure framework are determined and compared to the existing literature. The results differ substantially, highlighting the importance of explicit modeling of costly arbitrage in imperfectly competitive models.     

A note on asymmetric stochastic volatility and futures hedging

This note incorporates asymmetric responses to good and bad news within a stochastic volatility framework. It is shown that the asymmetry leads to a greater average optimal hedge ratio. Moreover, the ratio increases with increasing degree of asymmetry. On the other hand, asymmetry has no impact on the hedging performance. The result is consistent with the empirical finding of Brooks, Henry, and Persand (2002) where GARCH models are employed. © 2005 Wiley Periodicals, Inc. Jrl Fut Mark 25:607–612, 2005     

The marketing of bank risk-management services

This article analyzes the need to reform the structure of bank risk-management services (RMS), including the sale of derivatives. It reviews the contribution derivatives make to corporate financial management and discusses threatened restrictions on bank RMS following large losses reported by corporate clients. The two major weaknesses in RMS are characterized by incentive incompatibility and asymmetric information. Steps are proposed for aligning bank RMS incentives with client objectives. This requires reskilling bank management of RMS consistent with the holistic demands of globalization on corporate operations and strategies. Additional steps are proposed for equalizing buyer-seller information on the risks of opaque derivatives. These steps involve assistance to clients in setting policies leading to position limits and loss tolerances and instituting monitoring and disclosure. © 1995 John Wiley & Sons, Inc.