CATCHING‐UP AND TECHNOLOGICAL PROGRESS OF THE ASEAN ECONOMIES

Total factor productivity growth of the five ASEAN founding members is estimated by decomposing total factor productivity growth into technical efficiency and technological progress. By using the stochastic frontier model with individual‐specific temporal pattern of technical efficiency for the period of 1981–2003, the present paper identifies the unique temporal pattern of productivity changes in each country, to analyze the relationship between country characteristics and the inherent efficiency and productivity changes. The empirical results indicate that over the study period, growth in Singapore and Malaysia was largely driven by both technological progress and input accumulation, whereas growth in Thailand was induced by an improvement in technical efficiency and through input accumulation.     

DEVELOPING A BUSINESS PERFORMANCE EVALUATION SYSTEM: AN ANALYTIC HIERARCHICAL MODEL

A good business performance measurement system is a very effective tool to motivate and monitor employees of a company. Although interest in creating performance measurement models is widespread, a well-designed system is rare. To be successful in today's competitive environment, a good performance measurement systems should incorporate strategic success factors. The model proposed in this study uses a three-level hierarchical schema to combine financial and nonfinancial performance measures and emphasizes external as well as internal business performance measures. In comparison with previous methods, such a method is more likely to cover a broader set of measures that include operational as well as strategic control. A prototype based on the analytic hierarchical model can be applied to other business situations.     

CREATION OF A SEPARATE TELECOM REGULATORY AGENCY: A DURATION ANALYSIS OF ITS TIME PATTERN

At the center of the issues set out in the 1997 WTO Agreement on Basic Telecommunication Services was the creation of separate telecom regulatory agencies. Using the Cox proportional hazards model, this study examines how a country's socioeconomic factors affect the country's incentive to reorganize its regulatory structure and create a separate telecom regulatory agency. The main empirical findings suggest that a country's incentive to institute a separate telecom regulatory body is greater when its telecom sector performance is relatively poor and its political environment is more competitive with few institutional barriers. (JEL L52, L96 )     

Option Trading,Price Discovery,and Earnings News Dissemination*

Abstract. Option market activity increases by more than 10 percent in the four days before quarterly earnings announcements. We show that the direction of this preannouncement trading foreshadows subsequent earnings news. Specifically, we find option traders initiate a greater proportion of long (short) positions immediately before “good” (“bad”) earnings news. Midquote returns to active-side option trades are positive during nonannouncement periods and are significantly higher immediately prior to earnings announcements. Bid-ask spreads for options widen during the announcement period, but traders do not gravitate toward high delta contracts. Collectively, the evidence shows option traders participate generally in price discovery (the incorporation of private information in price), and more specifically in the dissemination of earnings news.     

The Role of Social Media in the Capital Market: Evidence from Consumer Product Recalls

We examine how corporate social media affects the capital market consequences of firms’ disclosure in the context of consumer product recalls. Product recalls constitute a “product crisis” exposing the firm to reputational damage, loss of future sales, and legal liability. During such a crisis it is crucial for the firm to quickly and directly communicate its intended message to a wide network of stakeholders, which, in turn, renders corporate social media a potentially useful channel of disclosure. While we document that corporate social media, on average, attenuates the negative price reaction to recall announcements, the attenuation benefits of corporate social media vary with the level of control the firm has over its social media content. In particular, with the arrival of Facebook and Twitter, firms relinquished complete control over their social media content, and the attenuation benefits of corporate social media, while still significant, lessened. Detailed Twitter analysis confirms that the moderating effect of social media varies with the level of firm involvement and with the amount of control exerted by other users: the negative price reaction to a recall is attenuated by the frequency of tweets by the firm, while exacerbated by the frequency of tweets by other users.     

A REVISIT TO THE STATIONARITY OF OECD INFLATION: EVIDENCE FROM PANEL UNIT‐ROOT TESTS AND THE COVARIATE POINT OPTIMAL TEST*

This paper re‐examines the stationarity of inflation rates in 19 Organisation for Economic Cooperation and Development countries with the use of cross‐sectional information. We employ the panel unit‐root tests that allow for cross‐sectional dependency and the covariate point optimal test. These tests have high power in common due to the exploitation of cross‐sectional information, and they can assist mutually to draw a concrete conclusion on inflation dynamics for all series in the panel. Our empirical results show that allowing for cross‐sectional dependency rejects the null hypothesis that all series in the panel have a unit root, implying that there is at least one stationary series in the panel. With the help of the results of the covariate test, we can distinguish the panel into a group of stationary and a group of non‐stationary series. For robustness, the two groups of series are re‐confirmed by the panel tests. Our results reveal evidence of mean reversion in inflation for 15 of 19 countries, which is significantly stronger as compared to that obtained by the state‐of‐the‐art univariate unit‐root tests.     

Measuring Birding Specialization: A Confirmatory Factor Analysis

The purpose of this study was to empirically test the construct validity of Gómez' Ethnicity and Public Recreation Participation (EPRP) Model. The EPRP Model was tested in the field on 311 Puerto Ricans in Massachusetts. Confirmatory factor analysis, path analysis, and fit indices were employed to test the model. The results indicated that all scales possessed good validity and reliability, and that the model met various goodness of fit criteria. Theoretical and practical implications of the EPRP Model are discussed.     

Asset Accumulation In Early Married Life

This longitudinal study of the factors influencing the accumulation of financial assets by young married couples in three metropolitan areas of Illinois, finds that couples that start out with a strong financial base tend to improve their relative financial position over time. Especially intriguing is the finding that those couples that acquired initially substantial amounts of debt were more likely to be well off financially at a later time, possibly because the principal asset purchased with these debts, own home, appreciated substantially during the period studied. The results also suggest that a measure of normal income becomes relevant to explaining variations in asset accumulation only after five or six years of the marriage, while socioeconomic variables other than income seemed to have relatively little effect on changes in asset holdings over time.