An econometric study of tourist arrivals in Aruba and its implications

The principal purpose of this study is to analyze econometric estimates in order to explain tourist arrivals to Aruba from the United States, The Netherlands and Venezuela. The study specified a dynamic econometric model for modeling short term as well as the long-term responses. It estimated both linear and log-linear functions, and it applied the Box–Cox statistical method to determine the appropriate functional form. The inclusion of Venezuela as a developing country permitted the comparison of the behavior of tourism demand in relatively rich and poor countries. The results indicated the extent to which cross-country behavior of demand differs with respect to changes in effective prices and exchange rates. This study can assist in the formulation of future macroeconomic policies as well as market and pricing strategies in a small or microstate economy.     

The nature of entrepreneurial experience,business failure and comparative optimism

Entrepreneurial (i.e. business ownership) experience may enable some entrepreneurs to temper their comparative optimism in subsequent ventures. The nature of entrepreneurial experience can shape how entrepreneurs adapt. Using data from a representative survey of 576 entrepreneurs in Great Britain, we find that experience with business failure was associated with entrepreneurs who are less likely to report comparative optimism. Portfolio entrepreneurs are less likely to report comparative optimism following failure; however, sequential (also known as serial) entrepreneurs who have experienced failure do not appear to adjust their comparative optimism. Conclusions and implications for entrepreneurs and stakeholders are discussed.     

Does socially responsible investment equity indexes in emerging markets pay off? Evidence from Brazil

This paper explores the financial performance of a mainstream socially responsible investment equity index in emerging markets: the Brazilian Corporate Sustainability Index. The results indicate that investors in emerging markets could accommodate their ethical values while at the same time not scarifying their overall portfolio performance in bullish market periods. However, the financial crisis led ethical investors to take a riskier and less profitable portfolio. These results seem to be due to socially responsible investment in Brazil that, as with other emerging markets, is highly influenced by social and institutional factors.     

How Does the Market Value Corporate Sustainability Performance?

This study provides empirical evidence on how corporate sustainability performance (CSP), as proxied by membership of the Dow Jones sustainability index, is reflected in the market value of equity. Using a theoretical framework combining institutional perspectives, stakeholder theory, and resource-based perspectives, we develop a set of hypotheses that relate the market value of equity to CSP. For a sample of North American firms, our preliminary results show that CSP has significant explanatory power for stock prices over the traditional summary accounting measures such as earnings and book value of equity. However, further analyses suggest that we should not focus on corporate sustainability itself. Our findings suggest that what investors really do is to penalize large profitable firms with low level of CSP. Firms with incentives to develop a high level of CSP not engaging on such strategy are, thus, penalized by the market.     

Bank lending,misleading signals,and the latin american debt crisis

This article explores the microfoundations of bank and borrower behavior in the Latin American debt crisis. In the model developed, less developed countries attract loans by signaling their ability and willingness to pay. Some of the signals are “coercive” because they indicate that if income targets are not met, income will be redistributed in order to honor debt obligations. Implicit in such coercive signaling is the borrower's expectation that redistribution will not damage economic productivity. A coercive signal is misleading when feedback effects on social stability and work effort—and thus on the ability to pay—are underestimated or ignored; in this case, it inaccurately predicts repayment prospects. We estimate two equations: (1) private lending to Latin borrowers as a function of our specified signals, and (2) the probability of payments problem as a function of the same set of signals. The results support our borrowing model: coercive signals do enhance lending, and at least one of these signals is misleading.     

Pecking Order Theory versus Trade-Off Theory: are service SMEs�� capital structure decisions different?

This paper seeks to analyse if the capital structure decisions of service small and medium-sized enterprises (SMEs) are different from those of other types of firm. To do so, we consider four research samples: (i) 610 service SMEs; (ii) 126 service large firms; (iii) 679 manufacturing and construction SMEs; and (iv) 132 manufacturing and construction large firms. Using the two-step estimation method, the empirical evidence obtained in this study shows that the capital structure decisions of service SMEs are different from those of other types of firm. Service SMEs’ capital structure decisions are closer to the assumptions of Pecking Order Theory and further removed from those of Trade-Off Theory compared with the case of other types of firm.     

Retail-consumer commitment and market segmentation

Customer's commitment has become a main mediating goal for many companies. It appears to be a promising market segmentation criterion. In this sense, the present work focuses on commitment as a possible criterion to segment the consumers' market. It starts by analysing the importance of consumer commitment for companies. After the review of the literature of commitment at different relationship levels, a definition and a multidimensional structure is proposed for this construct. The study performs a segmentation analysis of bank customers. Three clusters of clients are identified according to their level of commitment. Main conclusions and its implications for marketing management are pointed out.