Sterilisation and Monetary Control by the GCC Member Countries

The prevailing dollar peg of the Gulf Cooperation Council (GCC) countries and the absence of any significant current and capital account restrictions led some to believe that these countries have lost monetary independence. However, the paper presents evidence that interest rates of the GCC countries did not converge to the interest rates of the US implying that the assets of the GCC countries are not perfect substitutes to the US assets. This imperfect asset substitutability has allowed the GCC countries to manoeuvre their monetary policies and the central banks of the GCC countries have had some control over their money growth rates by sterilising the changes in international reserves. Results indicate that the monetary authorities of these countries used domestic credit policy to attain some domestic policy objective while engaging in sterilised foreign exchange intervention. This result implies that the proposed GCC central bank should be able to maintain the monetary independence as a group and can reap the benefit of monetary efficiency of the proposed Gulf Monetary Union.     

Postnormal network futures: A rejoinder to Ziauddin Sardar

Sardar's “Welcome to Postnormal Times” describes the chaotic, contradictory and uncertain climate today, and analyses the failure of progress, modernisation or efficiency to provide ethical, political or even trustworthy economic solutions to the instability of the present. Missing in his analysis is the role of knowledge, especially as it is migrating from individuals to technical networks. This paper argues that recent developments in the networking of knowledge point towards a new constellation in which networks are emerging as major powers alongside the nation and the market, the two pillars of global political economy in the 20th and early 21st century. It responds to Sardar's challenge to imagine the future by imagining the political consequences of recognising non-human agencies as political actors.     

Advertising in Malaysia—A Cultural Perspective

This article outlines, through a cultural perspective, one possible approach for advertising in Malaysia. The basis for this approach is derived from an analysis of the standardized and localized schools of advertising. Within the study, a Canadian example is used to shed light on the implications for businesses around the world for advertising in Malaysia. In addition, a comparison is drawn between Saudi Arabian and Malaysian cultures to determine if an advertising strategy used in other Islamic countries should be adopted in Malaysia. The findings suggest that although the majority of the citizens of Malaysia are Muslim, Malaysia's heterogeneous culture does not encourage a strict adherence to Islamic principles. The implication for Western businesses advertising in Malaysia is that a compromise be struck between a standardized and a localized advertising strategy.     

Welfare Effect of Mergers and Multilateral Trade Liberalization

In a two‐country model where firms behave à la Cournot, we show that trade liberalization increases (decreases) the social desirability of those mergers that generate sufficiently large (small) reductions in marginal cost. There exists a range of intermediate levels of marginal cost savings such that marginal tariff reductions increase (decrease) the desirability of merger at sufficiently low (high) tariff levels. Moreover, in the neighborhood of free trade, we show that if trade liberalization increases the profitability of a merger, it necessarily also increases its desirability.     

The business model and balanced scorecard in creative tourism: the ultimate strategy boosters

Despite the various studies on creative tourism, little managerial frameworks such as a business model and a balanced scorecard are investigated for this new phenomenon. The overall image that emerges from the literature is ambiguous and fuzzy. Also, many activities known as creative tourism experiences may provide new participative experiences but rarely include a creative process. This study covers a whole aspect in designing a feasibility test model for creative experiences based on balanced scorecard through qualitative content analysis and as the essence of that, a Business Model by content validity and clustering analysis. Analysis of data by the mentioned methods reveals that four perspectives and 13 critical success factors are essential for the feasibility of a creative tourism experience. In addition, 22 indicators in 3 main dimensions determine the success of a creative tourism business model. This study is part of a growing body of research focused on discovering hidden aspects of creative tourism.     

A Comparative Literature Survey of Islamic Finance and Banking

There has been large-scale growth in Islamic finance and banking in Muslim countries and around the world during the last twenty years. This growth is influenced by factors including the introduction of broad macroeconomic and structural reforms in financial systems, the liberalization of capital movements, privatization, the global integration of financial markets, and the introduction of innovative and new Islamic products. Islamic finance is now reaching new levels of sophistication. However, a complete Islamic financial system with its identifiable instruments and markets is still very much at an early stage of evolution. Many problems and challenges relating to Islamic instruments, financial markets, and regulations must be addressed and resolved. In this paper, we provide a comprehensive comparative review of the literature on the Islamic financial system. Specifically, we discuss the basic features of the Islamic finance and banking. We also introduce Islamic financial instruments in order to compare them to existing Western financial instruments and discuss the legal problems that investors in these instruments may encounter. The paper also gives a preliminary empirical assessment of the performance of Islamic banking and finance, and highlights the regulations, challenges and problems in the Islamic banking market.     

In search of global leaders

For all the talk about global organizations and executives, there's no definitive answer to the question of what we really mean by "global." A presence in multiple countries? Cultural adaptability? A multilingual top team? We asked four CEOs and the head of an international recruiting agency--HSBC's Stephen Green, Schering-Plough's Fred Hassan, GE's Jeffrey-lmmelt, Flextronics's Michael Marks, and Egon Zehnder's Daniel Meiland--to tell us what they think. They share some common ground. They all agree, for example, that the shift from a local to a global marketplace is irreversible and gaining momentum. "We're losing sight of the reality of globalization. But we should pay attention, because national barriers are quickly coming down", Daniel Meiland says. "If you look ahead five or ten years, the people with the top jobs in large corporations ... will be those who have lived in several cultures and who can converse in at least two languages." But the CEOs also disagree on many issues--on the importance of overseas assignments, for instance, and on the degree to which you need to adhere to local cultural norms. Some believe strongly that the global leader should, as a prerequisite to the job, live and work in other countries. As Stephen Green put it, "If you look at the executives currently running [HSBC's] largest businesses, all of them have worked in more than one, and nearly all in more than two, major country markets." Others downplay the importance of overseas assignments. "Putting people in foreign settings doesn't automatically imbue new attitudes, and it is attitudes rather than experiences that make a culture global," says Fred Hassan. The executives' essays capture views that are as diverse and multidimensional as the companies they lead.     

Japanese foreign exchange intervention: A tale of pattern,size, or frequency

This paper contributes to the debate of the efficacy of different patterns of foreign exchange intervention (FXI). Daily data on the Japanese foreign exchange intervention and the Yen/Dollar exchange rates among other macroeconomic variables over the period 1992–2004, in an EGARCH time series model is used to measure the impact of intervention on both the level and volatility of the exchange rate. This paper offers two important results in regard to the effectiveness of the Japanese FXI. First, this study tests whether the pattern of FXI leads to conflicting outcomes with respect to the desired level and volatility of the exchange rates. Second, this study examines the asymmetric impact of the frequency and size of the Japanese FXI on the level and volatility of the exchange rate. This paper finds that successful depreciation of the yen has always been achieved at the expense of higher volatility, a result that supports the conflicting outcomes of the Japanese FXI. In addition, the frequency of intervention is found to be a crucial factor in affecting the level of the exchange rate while the size of intervention is more influential in affecting its volatility.     

Charity Care by Non-profit Hospitals: The Price of Tax-exempt Debt

In this paper, we study the effects of tax-exempt debt on the supply of charity care of non-profit hospitals. We hypothesize that hospitals using tax-exempt rather than taxable debt are forced to provide higher levels of charity care as a condition for gaining access to the tax-exempt market. The study uses a panel of 189 California non-profit hospitals. Hospital uncompensated care is regressed on the level of uncompensated care by other hospitals in the market, lagged values of tax-exempt and taxable debt and other control variables.The magnitude of the tax-exempt bond subsidy has a positive effect on the flow of charity care and varies positively with the charity care provided by other hospitals. We conclude that subsidies provided by tax-exempt debt are an effective media to increase the supply of charity care by hospitals. Regulators can use competition between non-profit hospitals in order to enforce the desired behavior.