Monetary Policy Rules and Business Cycles

Basic features of business cycle properties under both exogenous and endogenous monetary policy rules are examined in calibrated dynamic stochastic general equilibrium models with nominal rigidities (the nominal wage contract model, the monopolistic competition model with price adjustment costs and a combination of these models). The experiments show that the difference in business cycle features under exogenous and endogenous monetary policy rules is as large as the change generated by introducing nominal rigidities (and monetary disturbances). This result suggests that, for monetary business cycle research, developing a proper way to incorporate endogenous monetary policy rules may be as important as developing new transmission mechanisms of monetary policy disturbances.     

Tourists' attitudes towards textiles and apparel-related cultural products: A cross-cultural marketing study

This study examined American, Korean, and Chinese female consumers' evaluations of and purchase intentions towards Korean textiles and apparel-related cultural products. This study also investigated how a consumer's evaluations of Korean textiles and apparel-related cultural products are related to novelty-seeking tendency, world-mindedness, and familiarity with Northeast Asian culture on the part of female tourists. Novelty-seeking appeared to be useful only when predicting how one will respond to cultural products from other countries and cultures, but not from one's own. Regardless of the sample, respondents' evaluations of the color and design of the product stood out as the most important indicator, across all four products, of how much they would like a given product, and further, would also like to purchase the product. Northeast Asian design contributed to favorable purchase intention even for those who are from Northeast Asia, indicating that fashion cultural products are not targeted only at those from other cultures.     

Effects of Monetary Policy Shocks on Farm Prices and Exchange Rates in Korea

The effects of monetary policy shocks on farm prices and exchange rates in Korea are empirically investigated by using vector auto-regression models with sign restrictions on impulse responses. The main empirical results are as follows. First, (contractionary) monetary policy shocks have significantly negative effects on real farm prices. Second, the SR effect on farm prices is significant but short-lived. The dynamic response of farm prices is consistent with the predictions of the “overshooting” model. Third, the effects of monetary policy shocks on farm prices are more significant than the effects of monetary policy shocks on exchange rates.     

Effect of regulatory oversight on the association between internal governance characteristics and audit fees

We examine the relationship between internal governance, external audit monitoring and regulatory oversight for a sample comprising industrial companies and financial/utility companies subject to additional industry‐specific regulation. Our results indicate that the association between audit fees and board/audit committee independence and size are weaker for regulated companies. These observations are consistent with the notion that regulatory oversight partially substitutes the external audit as a monitoring mechanism. However, boards/audit committees with more multiple directorships demand a more extensive audit in the presence of regulatory oversight to protect their reputation capital. Our study enhances our understanding of the complex relationships among the major corporate governance elements.     

On the empirics of international smoothing

By fully exploiting the statistical properties of panel data, this paper improves upon existing methodologies to estimate consumption smoothing at least in three respects. First, we model explicitly incomplete risksharing as well as incomplete intertemporal smoothing, and couch the two mechanisms in a unified framework. Second, we fully exploit simple panel data analysis in order to measure degrees of both risksharing and intertemporal smoothing taking place in a given set of economic regions. In particular, we are able to measure not only the smoothing of idiosyncratic shocks, but also the dependence on aggregate (non-diversifiable) shocks. Third, we distinguish neatly between the effects of temporary vs. permanent shocks. This can be done by taking advantage of the complementarity between the “within” estimator and the “between” estimator in a panel regression.     

The RMB Debate: Empirical Analysis on the Effects of Exchange Rate Shocks in China and Japan

For a better understanding of the ongoing debates on the RMB, this paper investigates the effects of exchange rate shocks on output and the current account for China and Japan. We use structural vector auto‐regression models and find that yen appreciation reduces current account surpluses while having no strong effect on output in Japan. RMB appreciation, on the other hand, has an insignificant effect on the current account, although it tends to reduce output in China. For China, dollar pricing with vertical trade integration seems responsible for the insignificant effect on the current account.     

Foodservice hygiene factors—The consumer perspective

Food safety is important to today's food industry operators as consumers have become increasingly concerned about risks related to food. Unlike foodservice operators or health inspectors, consumers can only rely on the visible cues, particularly those associated with food hygiene to judge the level of food safety in eating establishments. While previous research highlighted the influence of foodservice hygiene perception on consumer dining out decision, study examining the constructs of food safety cues that consumers employed is scant. This research aims to bridge the gap by exploring the topic from the consumer perspective. Results indicate that foodservice hygiene is one of the top three considerations when consumers select a dining place. Results of confirmatory factor analysis reveal a four-factor model encompasses staff and handling, food and location, premise and practices, and scent aspects. Further substantiation in different settings is needed for generalization purpose.     

Monetary policy, foreign exchange intervention, and the exchange rate in a unifying framework

The structural VAR model is developed to jointly analyze the effects of foreign exchange intervention and (money or interest rate setting) conventional monetary policy on the exchange rate, the two types of policy reactions to the exchange rate, and interactions between the two types of policies. First, many interactions among the two types of policies and the exchange rate are found, which suggests that a joint analysis is important. Second, foreign exchange intervention has substantial effects on the exchange rate, reacts to the exchange rate significantly (to stabilize the exchange rate), and signals future conventional monetary policy stance changes (to back up the intervention). This suggests the importance of modeling foreign exchange intervention explicitly in the study of monetary policy and exchange rate behaviors. Many other interesting results on the interactions among the two types of policies and the exchange rate are also documented.     

Economic screening procedures based on correlated variables

Summary Economic screening procedures for improving outgoing product quality based on screening variables are presented for the cases of one- and two-sided specification limits. It is assumed that the performance and screening variables are jointly normally distributed and that costs are incurred by screening inspection and misclassification errors. When all parameters are known, a closed-form solution is obtained for the case of one-sided specification limit and an approximate closed-form solution is derived for the case of two-sided specification limits. Methods for finding optimal solutions based on normal conditioned ont-distribution are presented for the cases of unknown parameters.