Idiosyncratic volatility,option-based measures of informed trading,and investor attention

Review of Derivatives Research - We establish a direct link between sophisticated investors in the option market, private stock market investors, and the idiosyncratic volatility (IVol) puzzle. To...     

Scientists' commitment to underperforming research projects: linking past success and the social environment

This article investigates scientists' commitment to underperforming research projects based on the concomitant consideration of their past success and social environments. Based on escalation of commitment and network theory, the model hypothesizes that past success triggers the commitment to underperforming projects but that the strength of this influence varies depending on the characteristics of decision makers' social networks. Results from the analysis of 3,072 scenario assessments nested within 96 scientists show that the positive relationship between past success and continued investment in underperforming projects is more positive when the network is larger, when the ties within the network are stronger, and when feedback from network partners is predominantly positive. Surprisingly and contrary to model predictions, results also show that the relationship between past success and scientists' tendency to commit to underperforming projects becomes stronger with lower communication frequency with network partners. This study extends current research by exploring the boundary conditions of the impact of decision makers' social environment on commitment to failing projects. Further, it adds to literature on the downside of success by emphasizing that decision makers, particularly those in some social environments, are driven to commit additional resources to underperforming – and potentially failing – projects. Decision makers acting in such environments should be aware that they are prone to overinvestment of resources, and the findings of this study can help them increase their awareness. Based on this study's results, decision makers (including scientists) can thus better reflect on and improve their research project evaluations. Finally, the findings of this study open up various opportunities for future research.     

IS MARKET‐ORIENTED REFORM PRODUCING A ‘TWO‐TRACK’ EUROPE? EVIDENCE FROM ELECTRICITY AND TELECOMMUNICATIONS

ABSTRACT: The European Commission has formally recognized that adequate provision of basic household services, including energy, communications, water and transport, is key to ensuring equity, social cohesion and solidarity. Yet little research has been done on the impact of the reform of these services in this regard. This article offers an innovative way to explore such questions by analyzing and contrasting stated and revealed preferences on citizen satisfaction with and expenditure on two services, telecommunications and electricity, in two large countries, Spain and the UK. We find evidence that in telecommunications, but not in electricity, reform has led to a ‘two‐track’ Europe, where citizens who are elderly, not working or the less‐educated behave differently in the market, with the result that they are less satisfied with these services than their younger, working, better‐educated, counterparts.     

Can message framings influence air passengers’ perceived credibility of aviation voluntary carbon offsetting messages?

Abstract

Past literature has identified low purchase rates of aviation voluntary carbon offsetting (VCO) schemes. A lack of credibility of such schemes has been identified as a key obstacle, yet little attention has been given on how to enhance perceived credibility. Using communication theory, this study examines effects of message framing on consumers’ perceived credibility of aviation VCO messages. Data were drawn from a representative sample of 1680 Australians. The results revealed that spatial distance framing influences air passengers’ perceived credibility of aviation VCO messages. Messages focusing on the influence of VCO programs on the environment of a local community obtain higher perceived credibility than those located in other countries. The study also found the interaction of spatial and temporal distance framing effects were different based on consumers’ past purchase experience. The findings suggest how airlines should design messages and refine them based on consumers’ past experience of aviation VCOs.     

Using a Regional Tourism Adaptation Framework to Determine Climate Change Adaptation Options for Victoria's Surf Coast

This paper reports research into adaptation to climate change for regional tourism destinations. It explains the application of a regional tourism adaptation framework model to the Surf Coast destination, within the state of Victoria, Australia. It then examines the usefulness of the framework model in guiding a vulnerability resilience assessment of the destination and developing strategies to increase the destinations resilience, resistance and readiness. A Delphi study was conducted, using a panel of experts, to determine the major risks and opportunities for tourism in the region as well as appropriate adaptation options. Although many of the findings focused on the best way to manage the negative bio-physical impacts of climate change, such as increased bushfire risk or more frequent and intense storms, several opportunities also became apparent including the potential to reduce seasonality. Tourism destination management is already a complex area and the introduction of climate change provides yet another challenge for managers and policy-makers. Consequently, the development and use of a regional adaptation framework can play an important role in assisting destination planning and management.     

Music Festivals and Social Inclusion – The Festival Organizers’ Perspective

There is growing interest in how festivals can help to build strong and cohesive communities, particularly whether they can reach a broad swathe of the population or operate as enclaves. This article explores ways in which festival organizers may contribute to social inclusion goals through a qualitative phenomenological study of music festivals. Findings suggest that these festival organizers may contribute to social inclusion across four areas of society—consumption, production, political engagement, and social interaction or communitas—through factors such as providing opportunities for local participation, learning new skills, and access to education about social justice. However, it appears that these festival organizers tended to direct their social inclusion efforts toward portable communities, focusing on attendees but failing to reach out to local residents. This limits their ability to embrace the local community in its broadest sense, and calls into question their likelihood of achieving inclusivity outcomes.     

Cartel overcharges: Survey and meta-analysis

The article presents a novel meta-regression analysis of the size of cartel overcharges from a sample of more than 800 observations collected from a wide variety of published sources. The analysis of a subsample of 395 cartel episodes finds that duration, legal environment, and organizational characteristics of cartels explain variation in overcharge rates to a greater extent than the type of publication or the method of calculation. Overcharges tend to be significantly higher for durable international cartels. Secular decline is observed as antitrust-enforcement regimes have stiffened.