Exchange-rate volatility and industry trade between the U.S. and Malaysia

Previous research that investigated the impact of exchange rate volatility on the trade flows of Malaysia concentrated only on the aggregate exports of Malaysia to the rest of the world. In this paper we first concentrate on the trade flows between Malaysia and the U.S. After showing that exchange rate volatility has neither short-run nor long-run effect on the trade flows between the two countries, we disaggregate the trade data by industry and consider the experience of 101 U.S. exporting industries to Malaysia and 17 U.S. importing industries from Malaysia. While exchange rate volatility seems to have significant short-run effects on the trade flows of most industries, short-run effects translate into the long run only in a limited number of small industries.     

THE EFFECT OF CROSS‐LISTING ON TRADING VOLUME: REDUCING SEGMENTATION VERSUS SIGNALING INVESTOR PROTECTION

We examine the relation between cross‐listing on the U.S. and UK regulated and unregulated exchanges and trading volume for a sample of 500 foreign firms from 34 countries. We find that the increase in trading volume is a function of both reducing segmentation and signaling investor protection. In addition, we find that home market trading volume, firm size, firm returns, and analyst forecast accuracy are the major determinants of a firm's trading volume. We also show that U.S. and UK investors trade foreign securities that originate from low‐investor‐protection countries more than they trade those from high‐investor‐protection countries, which is consistent with the bonding hypothesis.     

An extension of the benefit segmentation base for the consumption of organic foods: A time perspective

Abstract

Benefit segmentation is a long-standing marketing approach that emphasises the ‘what’ and ‘how’ dimensions of consumer benefits; that is, what benefits consumers perceive in product/service consumption, and how such benefits are perceived. This research proposes a fresh time-based approach to benefit segmentation – namely, focusing on the ‘when’ element or when in time benefits take effect. Drawing upon a survey of UK consumers, it explains and discusses consumption motivations through examining antecedents of temporally dominated benefits in application to organic food. Specifically, the study investigates why some consumers predominantly seek present-based benefits vis-à-vis future-based benefits or vice versa in organic food purchase and consumption behaviour. Using correlation and regression analyses, the research findings establish significant associations of level of involvement, prior knowledge level, and product usage level, and some association of time orientation with the temporally emphasised consumption benefits consumers ultimately pursue. Overall, the research highlights the added contribution of a time perspective in a benefit segmentation approach which can assist marketers in understanding better and communicating more effectively with consumers through drawing up consumer profiles based on when in time their dominantly pursued benefit for an offering is perceived to take effect.     

Real and Nominal Effective Exchange Rates for LDCs: 1971–2004

International Monetary Fund constructs and publishes real and nominal effective exchange rates mostly for industrial countries. Recently it has begun publishing such data for some newly industrialized developing countries as well. There remains some developing countries that still have not received any attention by the IMF. This paper bridges that gap by constructing quarterly real and nominal effective exchange rates for 11 developing countries over the 1971–2004 period. As an application we try to assess whether nominal depreciation in these countries has led to real depreciation.     

S-Curve at the Commodity Level: Evidence from US-India Trade

The short-run response of the trade balance to changes in the terms of trade or the real exchange rate comes under the heading of the “J-Curve” or the “S-Curve.” While the J-Curve is mostly investigated through regression analysis, the S-Curve is based on the cross-correlation function between the terms of trade and the trade balance. Previous research has shown that in a country where support for any of the two curves is weak, disaggregation of the trade data helps discover more evidence of either curve. This article adds to the literature by considering the experience of India. We demonstrate that once the trade data between India and the United States is disaggregated by commodity, there is evidence of the S-curve in most industries that trade between the two countries. Out of total of 27 industries that constitute about 70% of trade, there are 15 that support the S-Curve.     

Exchange-rate volatility and industry trade between Canada and Mexico

While it has long been assumed that exchange-rate volatility introduces a level of uncertainty that helps reduce trade flows, this need not be the case for particular country pairs or for specific products. This study examines the case of trade between Canada and Mexico—two members of the highly integrated North American market. Trade flows are examined for a number of specific products using the “bounds testing” cointegration approach over the period from 1973 to 2006. Relatively few industries see a long-run reduction in trade volumes due to volatility. This indicates that multinational producers in these integrated markets might be able to hedge against exchange-rate risk. Since major Mexican exports appear to see the largest reductions, Mexico might have a stronger incentive to reduce the volatility of the peso.     

Role of Advertising and Promotion in Brand Equity Creation

This article surveys the effects of the individual's attitude toward advertising and nonmonetary promotions besides other subjects, namely advertising cost and monetary promotions on brand equity. It has been surveyed on 392 consumers in Iran. Its results prove the effective role of the individual's attitude toward advertising in promoting the brand equity. The deficiency of advertising in affecting the perceived quality and brand association, and the inefficacy of nonmonetary promotions on brand equity are the fascinating ramifications. In addition, the findings show that businesses can improve the process of the brand equity management by contemplating the relations between the dimensions of the brand equity.     

Children’s Food Choice: Advertised Food Type,Health Knowledge and Entertainment

The purpose of this research is to examine how the moderating effects of health knowledge (inactive vs. active) and advertising’s entertainment level (high vs. low) affect children’s response to advertising’s food content (unhealthy vs. healthy). First, a primary study using the qualitative method was conducted with the purpose of identifying healthy and unhealthy food options based on culture, eating habits, nutritional value and the access of Iranian children to each option so that they could be displayed in TV advertising, advergames and questionnaires. Then, a 2 × 2 × 2 full-factorial, randomized, mixed-effects experimental design was used to test the research framework. 330 students (aged 6–11) participated in the study. The findings revealed that children tended to choose more unhealthy foods after exposure to unhealthy food advertising. This effect was greater for a higher level of entertainment, and was successfully moderated by the activation of health knowledge. It was concluded that embedding health messages in advertising (included TV advertising and advergames) help retrieving children’s health knowledge and therefore, choosing less unhealthy food by them.     

Do inpayments and outpayments respond to exchange rate changes asymmetrically: Evidence from Malaysia

Since the pass-through of exchange rate changes on import and export prices are asymmetric, we expect a country’s inpayments (export earnings) and outpayments (cost of imports) to also react to exchange rate changes asymmetrically. We demonstrate this hypothesis by considering trade between Malaysia and each of her 11 largest trading partners. We find that while the short-run effects of exchange rate changes on Malaysia’s inpayments and outpayments are asymmetric with all partners, the long-run asymmetric effects are present in less than half of the partners. The results are partner specific.     

A new perspective on the third-country effect: The case of Malaysia–US industry-level trade

Cushman suggested that impact of exchange rate volatility declines after the inclusion of the third-country effect. Like Cushman, when we use a linear analysis, we confirm his results. However, when we engage in asymmetric effects of exchange rate volatility which requires including nonlinear adjustment of volatility measures, the findings show more support to both exchange rate volatility influence and the third-country effect. Therefore, we propose that in examining exchange rate volatility effect on trade, consideration must be given to not just asymmetric effects of exchange rate volatility but also asymmetric effects of the third-country effect. We demonstrate these findings using monthly data from 54 Malaysian industries that export to the US and 63 Malaysian industries that import from the US.