Pooling international tourism in Western Europe

This paper examines potential improvements in measures of international travel demand elasticities by pooling cross sections and time series of travel receipts. International travel receipts for 18 European countries are pooled and estimates of elasticities with respect to income, exchange rates, relative prices, transport costs, and number of terrorism events are computed. Indexes are developed for the purpose of measuring and aggregating transport costs and terrorism. The results show that the responses to changes in these variables are significantly different across countries. When the countries are constrained to have the same elasticities, but the constants are allowed to be different, it is found that all variables affect tourism in the expected direction and are statistically significant.     

The effect on stockholder wealth of product recalls and government action: The case of Toyota's accelerator pedal recall

We analyze the effect of Toyota's faulty accelerator pedal on stockholder wealth. Using the event study methodology, we show that a major recall in January of 2010 is associated with a 19% fall in the company's cumulative abnormal returns. Continued concerns that Toyota was unable to identify and adequately fix the problem prompted the National Highway Traffic Safety Administration to conduct its own investigation in March, 2010. The results of this government investigation exonerated the company and Toyota's cumulative abnormal returns rose by almost 9%. The Toyota case provides an opportunity to study a product recall with both company error and a government action that addressed concerns about the safety of the product.