Stock market cycles and stock market development in Spain

In this paper we use Spanish stock market data to identify the bull and bear phases of the market and to analyze its characteristics during the period 1941-2002. We compare these characteristics with those of the US and of two other European countries (Germany and the UK). Our sample is divided in two subperiods in order to account for differences induced by the process of development undergone by Spanish capital markets in the late 1980s and early 1990s. We find that the Spanish stock market has become increasingly more similar to those of the more developed countries, although some differences still persist. Additionally, we show that concordance of the Spanish stock market with other developed markets has increased quite significantly.JEL Classification: C22, G15An earlier version of the paper circulated under the title Bulls and bears: lessons from some European countries. Comments from seminar participants at the Universidad de Navarra, at the IX Meeting of the Spanish Finance Association (Pamplona 2001) and at the Royal Econonomic Society Conference (Warwick 2002) are gratefully acknowledged. We are very grateful to J.M. Campa, G. Llorente and two anonymous referees for helpful comments and suggestions. We also thank D. Garcia and the Research Department of the Madrid Stock Exchange for generously providing the data of the Spanish case. Financial assistance from the Spanish Ministry of Science and Technology (SEC2002-01839) is gratefully acknowledged. The usual disclaimer applies.     

Opportunity motivation and SME internationalisation in emerging countries: Evidence from entrepreneurs’ perception of institutions

Institutional studies based on cross-country comparisons and founded on a determinist perspective analyse the behaviour in emerging economies. The current research, in contrast, looks to neo-institutionalism and the literature on entrepreneurship to pose two research questions based on individuals’ discretion: (1) How does the entrepreneur’s perception of the institutional dimensions influence their decision to involve their SME in international operations? (2) What role does opportunity motivation play in the impact of those perceptions on the internationalisation decision? We analyse a sample of 296 entrepreneurs who had founded their businesses in Brazil (Federal State of Sergipe), and our results confirm that the individual’s perception of the normative and regulative aspects of institutions, the interaction between the two, and the interaction between the normative and cognitive aspects of institutions, explain the decision to embark on international operations. Opportunity motivation mediates the impact of the normative aspects of institutions on that decision.     

Loss of water availability and stream biodiversity under land abandonment and climate change in a Mediterranean catchment (Olzinelles,NE Spain)

In the north rim of the Mediterranean region, where forest cover is increasing as a result of land abandonment and temperatures are rising as a result of climate change, there is increasing interest for the effects of such changes on the runoff of water courses. This is a paramount issue for the conservation of many freshwater habitats and species. In this work we studied the effects of both an increase in forest cover after depopulation and land abandonment and an increase in temperature on the runoff of a Mediterranean catchment and on the aquatic and semi-aquatic fauna species of the stream (Olzinelles valley, NE Spain). Although in our simulation no decreasing trend in runoff is detected, the monthly runoff-rainfall ratio is now 15% lower than 30 years ago, a fact that may be attributed to a drier period rather than to the small afforestation experienced by the catchment in the last decades. Other factors such as increasing temperatures, changing rainfall patterns and increasing canopy cover are discussed. The observed decrease in the water flow has caused the disappearance of white-clawed crayfish (Austropotamobius pallipes), Mediterranean barbel (Barbus meridionalis), chub (Squalius cephalus), European eel (Anguilla anguilla), and southern water vole (Arvicola sapidus). Our results suggest that in a progressively warmer climate, and especially after land abandonment processes, management of Mediterranean mountain areas should be oriented towards an appropriate distribution of agrarian and forest land-covers in terms of water availability. Down to the stream scale, the pools that keep water throughout the year should be conserved and extended to enhance its potential to maintain aquatic and semi-aquatic species populations.     

Brakes to organic market enlargement in Spain: consumers’ and retailers’ attitudes and willingness to pay

In Spain, consumption of organic products has not kept pace with production. Up till now, foreign markets have been a natural destination for excess supply. However, world trade liberalization might cause important commercial problems to Spanish producers that could be partially solved by enlarging the domestic market. The goal of this paper is to assess the opportunity for such enlargement focusing on two main aspects: consumers’ and retailers’ attitudes and willingness to pay for organic products. Concerns about health, natural diets or environmental issues could stimulate consumption, while retailing dynamism and competition to gain new market segments might favour distribution. Both aspects are investigated through two surveys addressed to consumers and retailers in two Spanish towns. The results confirm that only a small proportion of consumers and distributors show attitudes that might favour demand expansion. The most sensitized segments are willing to pay more for organic products, but this premium is still very far from the prevailing gap between conventional and organic food products.     

Cultural differences and entrepreneurial behaviour: an intra-country cross-cultural analysis in Cape Verde

Two recent research trends give rise to the current work: the need to extend the conclusions reached in entrepreneurship studies to other cultural contexts, particularly important given the interest in stimulating the creation of firms in recently industrialised and less developed countries; and the need to go beyond the axiom ‘nation=culture’ in favour of the multiple cultures perspective. With these antecedents, we present the current work, which aims to answer two research questions: (1) are the cultural values associated in the literature with venture creation generalisable to different cultural contexts? (2) are there intra-cultural differences in a country generating differences in the entrepreneurial behaviour of its population? Thus, this work contributes to extending knowledge about entrepreneurship and international cross-cultural management by taking the novel approach of studying the cultural values and the decision to create a venture from the intra-cultural differences perspective. A sample of 448 individuals, obtained in the Republic of Cape Verde and analysed in six territories within this country, allows us to confirm the existence of cultural differences in individualism between regions of the Republic of Cape Verde, as well as their capacity to explain entrepreneurial behaviour in these regions.     

Organizational commitment in MNC subsidiary top managers: antecedents and consequences

This article studies, first, how affective and continuance commitments affect MNC subsidiary top managers' intent to leave either their current post or the firm itself, and second, which variables influence these managers' affective and continuance commitments. The analysis uses a sample of MNC subsidiary top managers in Spain, and the results confirm that these managers' intent to leave the subsidiary and the multinational is determined by affective and continuance commitments in its two dimensions (high-sacrifice and low-alternatives), and that these commitments, in turn, are determined by the managers' personal cultural values and company bonding variables.     

Are Local and Organic Claims Complements or Substitutes? A Consumer Preferences Study for Eggs

This paper provides an analysis of consumer preferences for product claims, specifically about origin and production methods. In particular, it addresses two important questions: i) whether consumers are willing to pay a premium for food products carrying these claims; and ii) whether local and organic claims are complements or substitutes. A choice experiment designed to estimate two‐way interactions was undertaken in Spain for eggs. The findings show first, that consumers are willing to pay a positive premium price for an enhanced method of production (that of barn, free‐range and/or organic instead of cage produced eggs) as well as for the proximity of production (local, regional and national over imported). Second, the findings show that consumer preferences for the claims are heterogeneous with two consumer segments being identified: “origin preference”, the larger segment, and the “production method preference”. Results show that organic and local claims were complements for the larger first segment but that free‐range and local/regional claims were substitutes for the second smaller segment. These results provide the marketing chains with insights applicable for pricing strategies.     

The Future of East Asia’s Trade: A Call for Better Globalization

This paper is about how East Asia should respond to the challenges of the external environment. The first challenge is the current slowdown in trade, which has been due to cyclical and structural factors such as the decline in productivity and the maturation of global value chains. The rise in protectionism as measured by rising trade restrictiveness has not impacted on trade, but political and policy uncertainty regarding the direction of trade policy seems to have begun to impact on trade growth. The policy stance of increased protectionism and a retreat from the multilateral rules‐based trading system is linked to the pockets of the population who have not seen their incomes improve and who have blamed their plight and increased inequality on globalization. In fact, the issue is more about the lack of effective responses to manage the costs of trade liberalization. East Asian economies need to respond to these challenges by upholding the multilateral rules‐based trading system, continuing the various pathways to regional economic integration, and ensuring better globalization through effective capacity building and policies to address the negative effects of trade liberalization.     

Do consumers perceive benefits from the implementation of a EU mandatory nutritional labelling program?

This paper examines consumers’ knowledge about nutritional labels (i.e., nutritional panel), use of nutritional labels, and perceived benefits from a mandatory nutritional labeling program. Using data from a pilot study conducted in a Spanish city and a three-equation multivariate probit model, our results suggest that individuals who suffer some health problems related to food intake are more knowledgeable about nutritional labels. Further, those who are more knowledgeable about nutritional labels are more likely to use nutritional labels, and nutritional label users are more likely to consider mandatory nutritional labeling as beneficial. Perceived usefulness of the information provided by nutritional labels as well as the amount of presented information affect consumer perceptions about whether or not mandatory nutritional labeling would be beneficial.     

US stock market volatility persistence: evidence before and after the burst of the IT bubble

In this paper we test whether the US stock market volatility presents a different behavior before and after the burst of the IT bubble. Using long range dependence techniques we examine the order of integration in the absolute and squared returns in three daily stock market indices (DJIA, S&P and NASDAQ). The results indicate that both absolute and squared returns present long memory behavior. In general, the highest orders of integration in the volatility processes correspond to the NASDAQ index. The results also show that in most cases the volatility is more persistent in the bear market than in the bull market.