R&D Activities In a Peripheral Region: an Empirical Study with Special Reference to the North East Region of the UK

This study examines the incidence of research and development (R&D) activities, type of R&D undertaken and the incidence of R&D co-operation among manufacturing firms located in a key urban area of the North East England, a peripheral region of the UK. We have found that over 62% of manufacturing firms in this urban growth area to be R&D active, suggesting that R&D active firms tend to be concentrated in urban area s in a peripheral region, as it is the case in the leading regions. However, the incidence of R&D co-operation was found to be relatively low among R&D active firms. It is also found that the key determinants of undertaking R&D to be the existence of a core competence/product and exporting activities. These findings might be of interest to policy makers promoting economic growth via firm’s R&D activities.     

The demand for tourism in North East England with special reference to Northumbria: an empirical analysis

This paper examines the trends of tourism in North East England. In particular, we focus on the area of Northumbria to show the potential of tourism for economic development in the region. Within this analysis, we concentrate on the demand for tourism in the region, and in particular we are concerned with tourism by UK residents in Northumbria (‘domestic’ tourism). The long run relationship between domestic tourism demand, and a number of economic factors effecting this demand, is considered using the Johansen and Juselius (1990, 1992) Multivariate Cointegration analysis. An error-correction model is then proposed for short-run forecasting of domestic demand for tourism in Northumbria.     

The components of the bid-ask spread: a general approach

A simple time-series market microstructure model is constructedwithin which existing models of spread components are reconciled.We show that existing models fail to decompose the spread intoall its components. Two alternative extensions of the simplemodel are developed to identify all the components of the spreadand to estimate the spread at which trades occur. The empiricalresults support the presence of a large order processing componentand smaller, albeit significant, adverse selection and inventorycomponents. The spread components differ significantly accordingto trade size and are also sensitive to assumptions about therelation between orders and trades.     

Aggregate imports and expenditure components in the UK: an empirical analysis

This paper examines the long-run relationship between UK aggregate imports and the macroeconomic components of final expenditure, using the Johansen multivariate cointegration analysis. It is found that there are significant differences between the long-run elasticities of import demand with respect to the different components of final expenditure, over the period 1972 to 1990. An error correction model is proposed for short-run forecasting of UK aggregate imports. The short-run model appears to track the data well.     

A price endogenous computable planning model for a dual economy

This paper examines the nature of linkages between growth, employment and functional distribution of income in a dual economy. The analysis is carried out in terms of a dual economy general equilibrium model which is implicitly based on a social accounting matrix (SAM) type of information system. The parameter values and the structure of the model are based on Iranian data and the selection of policy packages is inspired by those undertaken in Iran during the 1970s. The model sheds some light on the consequences of the policies by quantifying their potential impact on the sectoral growth of output, levels of employment and functional distribution of income in the rural and urban areas.     

Stock market structure and volatility

The procedure for opening stocks on the NYSE appears to affectprice volatility. An analytical framework for assessing themagnitude of the structurally induced volatility is presented.The ratio of variance of open-to-open returns to close-to-closereturns is shown to be consistently greater than one for NYSEcommon stocks during the period 1982 through 1986. The greatervolatility at the open is not attributable to the way in whichpublic information is released since both the open-to-open returnand the close-to-close return span the same period of time.Instead, the greater volatility appears to be attributable toprivate information revealed in trading and to temporary pricedeviations induced by specialist and other traders. The impliedcost of immediacy at the open is significantly higher than atthe close. Other empirical evidence in this article documentsthe volume of trading at the open, the time delays between theexchange opening and the first transaction in a stock, the differencein daytime volatility versus overnight volatility, and the extendto which volatility is related to trading volume.     

Market microstructure and stock return predictions

To what extent are the empirical regularities implied by marketmicrostructure theories useful in predicting the short-run behaviorof stock returns? A two-equation econometric model of quoterevisions and transaction returns is developed and used to identifythe relative importance of different microstructure theoriesand to make predictions. Microstructure variables and laggedstock index futures returns have in-sample and out-of-samplepredictive power based on data observed at five-minute intervals.The most striking microstructure implication of the model, confirmedby the empirical results, specifies that the expected quotereturn is positively related to the deviation between the transactionprice and the quote midpoint while the expected transactionreturn is negatively related to the same variable.