Asymmetric causality between Australian inbound and outbound tourism flows

We employ the asymmetric version of the Granger causality test to assess how Australian inbound and outbound tourism flows across 49 markets (countries) are driven by the sign-dependent variations in departure series or vice versa. A multivariate generalized autoregressive conditional heteroscedasticity (MGARCH) model is also estimated to study the time-varying co-volatility between inbound and outbound tourism growth rates. We find that rising co-volatility spillovers between inbound and outbound tourism are statistically significant for a number of markets. The six markets that are most susceptible to global shocks are China, Hong Kong, Papua New Guinea, Singapore, South Africa and the United Kingdom. China is by far the largest of these markets and, except for the United Kingdom, both arrivals and departures for each of these countries represent growing markets for Australia. We present recommendations for policymakers and destination management organizations (DMOs) to assist in developing customized strategies targeting resilient inbound markets in order to optimize tourism performance and reduce potential losses in times of crisis.     

Asymmetric size-dependent effects of the output gap on inflation: US evidence from the last half a century

This article examines asymmetric size- and sign-dependent effects of the output gap on the US quarterly inflation rate using data from the last half a century (1959Q2–2013Q1). Consistent with previous studies, it is found that the consumer price index is cointegrated with the unit labour cost and the price of oil. A short-run dynamic model is then estimated in which variations in the output gap are divided into three groups: large-positive; large-negative; and small-medium positive/negative. The results provide convincing evidence that only sufficiently large (positive or negative) variations of the output gap can significantly influence inflation. Put otherwise, relatively small to medium changes in the output gap exert no significant impact on inflation and if not separated, they can somewhat obscure the significant effects associated with large variations of the output gap. This study can lead to greater consensus on the inflation–output gap nexus. The findings remain robust despite the use of different measures of output gap and they are consistent with the modern doctrine but with a new caveat: inflation responds to both positive and negative changes in the output gap as long as such variations are of sizable magnitudes.     

Input substitution in manufacturing for three LDCs: translog estimates and policy implications

Demand and subsititution elasticities from a translog cost model are estimated for the manufacturing sectors of India, Pakistan, and Bangladesh. Conventional formulae for the standard errors of the estimated elasticities are checked by a bootstrap experiment, and their validity is confirmed for the moderate-sized samples of India and Pakistan. The elasticity estimates indicate a high degree of substitutability among capital, labour, and energy resources in manufacturing sectors of these countries. The result yields important policy implications for employment expansion through changing relative resource prices and the ability of these three economies to adjust to energy price shocks without serious impairment to economic growth.     

Global slack hypothesis: evidence from China,India and Pakistan

It is widely believed that globalization has changed inflation process. The global resource capacity reduces responsiveness of inflation to domestic activity and increases responsiveness of inflation to global resource capacity. This global slack hypothesis is tested using different theoretical specifications, which also relate domestic output elasticity and foreign output elasticity to the degree of trade openness of an individual economy. The results reject this hypothesis. The global resource capacity does not drive domestic inflation. The impact of globalization has not increased in the inflation process, and the results yield important policy implications for monetary policy formulation. The global resource capacity does not affect ability of the central banks to stabilize inflation, real economic activity and also respond to the volatility of output growth.     

Identifying structural changes and regime switching in growing and declining inbound tourism markets in Australia

This paper examines the dynamic changes in the number of tourists arriving in Australia from 53 markets using monthly data (1991m1–2014m4). A modified capital asset pricing model incorporating Markov switching and Bai–Perron search models is adopted to measure the extent to which individual arrival series exhibit systematic co-movements in relation to total arrivals as a global composite barometer. The study identifies 15 large and growing markets from different countries and regions with the switching/shifting betas greater than +1, suggesting a diverse portfolio that, if properly managed, will continue to sustain Australia's tourism industry. The study presents a series of marketing and promotion strategies to improve marketing efficiency and implications for further research are discussed.     

An analytical approach with a reliable logic and a ranking policy for post-mining land-use determination

Because it is the post-mining land-use that prescribes the methods, the measures and the costs of mine reclamation, a major implicit goal of mine reclamation is to determine an after-use option. Therefore, there should be an analytical approach to optimize the determination of post-mining land-use. A Mined Land Suitability Analysis (MLSA) framework, which had been previously derived from reclamation practice reports of mines and other disturbed lands, is used in combination with two Multi-Attribute Decision-Making (MADM) techniques to provide the required analytical approach. In the proposed approach the decision makers consist of the most related experts and the identified stakeholders. The Analytical Hierarchy Process (AHP) method is used to determine global weights of MLSA framework attributes via pair-wise comparison matrixes composed by each individual expert. Once the global weight vector of the attributes is calculated using AHP, they are incorporated into the decision matrices composed by stakeholders and passed to the Technique for Order Preference by Similarity to Ideal Solution (TOPSIS), which is a distance-based MADM technique and is used to determine preference order of post-mining land uses.     

Assessing the Impact of Changes in Petroleum Prices on Inflation and Household Expenditures in Australia

This article analyses the expected impact of a twofold rise in petrol prices on sectoral prices and household expenditures in Australia using 1996–97 and 1977–78 input-output tables.     

Modeling integrated supply chain logistics in real-time large-scale disaster relief operations

The goal of this research is to develop a comprehensive model that describes the integrated logistics operations in response to natural disasters. We propose a mathematical model that controls the flow of several relief commodities from the sources through the supply chain and until they are delivered to the hands of recipients. The structure of the network is in compliance with FEMA's complex logistics structure. The proposed model not only considers details such as vehicle routing and pick up or delivery schedules; but also considers finding the optimal locations for several layers of temporary facilities as well as considering several capacity constraints for each facility and the transportation system. Such an integrated model provides the opportunity for a centralized operation plan that can eliminate delays and assign the limited resources to the best possible use.A set of numerical experiments is designed to test the proposed formulation and evaluate the properties of the optimization problem. The numerical analysis shows the capabilities of the model to handle the large-scale relief operations with adequate details. However, the problem size and difficulty grows rapidly by extending the length of the operations or when the equity among recipients is considered. In these cases, it is suggested to find fast solution algorithms and heuristic methods in future research.     

Willingness to Pay for Pesticide Free Fruits: Evidence from Pakistan

ABSTRACT

This paper analyzes factors influencing consumption decision of pesticide free fruits (PFF) and estimates the willingness to pay (WTP) price premium for PFF in Pakistan. A contingent valuation survey of 200 households was conducted using face to face interview and payment card method. Results suggested that 93.5% respondents were WTP higher prices for PFF. Remarkably, around 35% respondents were WTP 16–20% higher prices and 24% respondents were WTP 6–10% higher prices for PFF than the existed conventional price. In addition, our ordered logit regression suggests that demographic and socio-economic variables such as age, education, income, household’s size and perception about health benefits are significantly associated with higher WTP for PFF.     

Effective utility functions induced by organizational target‐based incentives

Many companies set performance targets for their divisions to decentralize the decision‐making process and communicate with outside investors. This paper analyzes the effects of performance targets on the decision‐making behavior of the divisions. We introduce the notion of an ‘effective utility function’—a function that a division should use in its selection of projects if it wishes to maximize the probability of achieving its targets. We show that many target‐based incentives induce S‐shaped utility functions and discuss the organizational problems they may pose. We then show how an organization can set targets that induce expected utility maximization. Copyright © 2008 John Wiley & Sons, Ltd.