The effect of banking market structure on the lending channel: Evidence from emerging markets

This paper analyses the extent to which the level of bank competition influences monetary policy transmission. Using a large panel dataset of 978 banks from 55 countries, and employing the Lerner index model as a measure of market structure, our results show that an increase in banking sector competition weakens the effectiveness of monetary policy on bank lending. The findings are robust to a broad array of sensitivity checks including control of alternative measurements of the Lerner index, different samples and different methodological specifications. By extension, these results have important policy implications for regulators in assessing the effectiveness of monetary policy transmission mechanisms.     

Evidence of Industry Scale Effects on Audit Hours,Billing Rates,and Pricing

Using a proprietary data set consisting of all private firm audit engagements in 2000 from one Big 4 firm in Belgium, we investigate (i) whether audit office industry scale is associated with a reduction of total, partner, and staff audit hours and thus with efficiency gains triggered by organizational learning from servicing more clients in an industry and (ii) whether the extent of efficiency pass‐on from the auditor to its clients depends on the audit firm's market power. We find that auditor office industry scale is associated with efficiency gains and a reduction of the variable costs (i.e., fewer total audit hours, partner hours, and staff hours), ceteris paribus. Our results also suggest that, on average, realized efficiencies are entirely passed on, as evidenced by a nonsignificant effect of auditor industry scale on the auditor's billing rate. Furthermore, we find that the extent of the efficiency pass‐on decreases with the market power of the audit firm in the industry market segment as we document a higher billing rate for auditors with high market power (versus low market power). In addition, we find that the lower audit hours associated with auditor industry scale do not compromise audit quality.     

An investigation of issues relating to where energy should enter the production function

This paper examines the impact of imposing different separability assumptions in the specifications of the standard hierarchical KLEM production function in a computable general equilibrium (CGE) model. The appropriate means of introducing energy to production functions has been a source of debate for a number of years. However, while modellers often subject results to parametric sensitivy analysis regarding the values associated with elasticities of substitution between inputs, it is rarely the case that the structure of the production function is subjected to testing. However, the chosen structure reflects the modeller's view about elasticity between different inputs and will have implications for model results wherever there are changes in relative prices. We illustrate our argument by introducing a simple demand shock to a CGE model of the Scottish economy (targeted at the energy supply sector) under different assumptions regarding the structure of the KLEM production function and separability assumptions therein.     

Reflections on discriminant validity: Reexamining the Bove et al. (2009) findings

Bove, Pervan, Beatty and Shiu (2009) develop and test a latent variable model of the role of service workers in encouraging helpful behaviors by customers towards the service business (OCBs). Farrell (2010) questions these findings due to an incorrect application of the Fornell and Larcker (1981) discriminant validity test. The authors respond to Farrell's criticism by discussing the options available for assessing discriminant validity, the current use of these options in top journals, the underlying assumptions of these assessments, and the appropriateness of the alternative assessments under different types of situations. Finally, the authors address the specific concerns raised in Farrell (2010) in regard to Bove et al. (2009).     

Estimating consumer willingness to pay for food quality with experimental auctions: the case of yellow versus fortified maize meal in Kenya

Biofortification of maize with provitamin A carotenoids is a new approach to the alleviation of vitamin A deficiencies in Africa. Unfortunately these varieties are yellow or orange, while consumers generally prefer white. Consumer willingness to pay for yellow and fortified maize was compared in experimental auctions in three regions in Kenya. The premium that consumers are willing pay for fortified maize (24%) was higher than the discount they require to buy yellow maize (11%), and in one zone consumers prefer yellow. Yellow color is, therefore, not an impossible obstacle for biofortified maize, although it would clearly be easier to introduce this maize first in regions where yellow maize is currently grown.     

Regime switching as a test for exchange rate bubbles

This paper develops a new test for speculative bubbles, which is applied to data for the Japanese yen, the German mark and the Canadian dollar exchange rates from 1977 to 1991. The test assumes that bubbles display a particular kind of regime-switching behaviour, which is shown to imply coefficient restrictions on a simple switching-regression model of exchange rate innovations. Test results are sensitive to the specification of exchange rate fundamentals and other factors. Evidence most consistent with the bubble hypothesis is found using an overshooting model of the Canadian dollar and a PPP model of the Japanese yen.     

Enabling the language of accessible tourism

The growing body of literature on “accessible tourism” lacks a critical scholarly debate around its specific language use and nomenclatures. To fill this gap, this paper provides a first examination of language. Language provides a unique capability to resist, strengthen and reframe identities of individuals and groups, yet can also reinforce, weaken and perpetuate dominant worldviews of disability. A content analysis examined previous accessible tourism literature with results illustrating that diversity exists amongst the varying terminologies adopted by scholars. Terms were employed loosely, inconsistently and interchangeably, euphemistically with erroneous understandings and nuances. The paper concludes with critical discussion about the power of researchers to (re) produce oppression through language that maligns and misrepresents, or to (re) conceptualise and (re) construct the world we live in with liberating language that facilitates positive social change.