Scoring rules and survey density forecasts

This article provides a practical evaluation of some leading density forecast scoring rules in the context of forecast surveys. We analyse the density forecasts of UK inflation obtained from the Bank of England’s Survey of External Forecasters, considering both the survey average forecasts published in the Bank’s quarterly Inflation Report, and the individual survey responses recently made available to researchers by the Bank. The density forecasts are collected in histogram format, and the ranked probability score (RPS) is shown to have clear advantages over other scoring rules. Missing observations are a feature of forecast surveys, and we introduce an adjustment to the RPS, based on the Yates decomposition, to improve its comparative measurement of forecaster performance in the face of differential non-response. The new measure, denoted RPS*, is recommended to analysts of forecast surveys.     

Making sense of tourists' complaints

The problem of dealing with tourists' complaints is not fully covered in the tourism literature. This article discusses the quality of the data available on tourists' complaints and it is proposed that two concepts from social psychological research can be used to interpret and understand them; first, the notion of ‘fit’ between tourists and the environments they visit; second, the concept of attribution theory is shown to be useful for understanding the process by which tourists allocate blame and responsibility.     

Does family planning help the employment of women? The case of India

This paper gives some insight into the existence of a positive effect of family planning programmes on women's employment in developing countries. We study married women aged 15–49 living throughout India using a sample drawn from the National Health Family Survey (NFHS-2) for 1998–1999. We focus on a programme of doorstep services delivered by health or family planning (FP) workers who are sent to visit women in their assigned areas. Results derived from the estimation of fixed effect linear probability and conditional logit models show a positive and significant correlation of the share of women living in a local area (village, town or city) that has been visited by FP workers with the probability of women's employment. A multinomial analysis also shows that the largest positive effect of FP in rural India is to be found on paid work, as opposed to unpaid work, suggesting a potential empowering feedback of demographic measures through labour earnings.     

Common dynamic factors for cryptocurrencies and multiple pair-trading statistical arbitrages

Decisions in Economics and Finance - In this paper, we apply dynamic factor analysis to model the joint behaviour of Bitcoin, Ethereum, Litecoin and Monero, as a representative basket of the...     

Exploring word‐of‐mouth influences on travel decisions: friends and relatives vs. other travellers

Travel research consistently shows the importance of word‐of‐mouth (WOM) information sources in the travel decision‐making process. Friends and relatives have been identified as organic image‐formation agents, and it has been emphasized that this WOM information is one of the most relied‐upon sources of information for destination selection. While there has been recognition of the importance of WOM information sources on consumer behaviour in tourism, little has been performed to understand more specifically how and what behaviour is influenced. This study examined the differing influences of friends and relatives vs. other travellers on the travel choices and behaviours of 412 visitors to the North Queensland Region in Australia. More specifically, the present study compared the following four groups of respondents: those who indicated that they obtained travel information from friends/relatives and other travellers (n = 70); those who obtained information from friends/relatives only (n = 121); those who obtained information from other travellers only (n = 105); and those who obtained information from neither (i.e. no WOM) (n = 116). The results indicated that there were significant differences across the four groups with respect to demographic characteristics, other information sources used, accommodation and transportation used, and travel activities in the destination. However, the groups did not differ in their image of the destination.     

The Measurement and Characteristics of Professional Forecasters' Uncertainty

Several statistical issues that arise in the construction and interpretation of measures of uncertainty from forecast surveys that include probability questions are considered, with application to the Bank of England Survey of External Forecasters. Substantial heterogeneity of individual forecasters' uncertainty is found, together with significant persistence in their relative uncertainty, which is a new finding in professional forecast surveys. It is an individual characteristic akin to the individual optimism and pessimism already established in the literature on point forecasts; the latter is also found in the current dataset, now in a bivariate sense with respect to joint inflation and output growth point forecasts. Whether disagreement among point forecasts is a useful indicator of uncertainty is shown to depend on the underlying macroeconomic environment. Copyright © 2014 John Wiley & Sons, Ltd.     

The information in the term structure of German interest rates

This paper tests the Expectations Hypothesis (EH) of the term structure of interest rates using new data for Germany. The German term structure appears to forecast future short-term interest rates surprisingly well, compared with previous studies with US data, while it has lower predictive power for long-term interest rates. However, the direction suggested by the coefficient estimates is consistent with that implied by the EH, that is when the term spread widens, long rates increase. The use of instrumental variables to deal with possible measurement errors in the data significantly improves regressions for the long rates. Moreover, re-estimation with proxy variables to account for the possibility of time-varying term premia confirms that the evolution of both short and long rates corresponds to the predictions of the EH and that most of the information is in the term spread. These results are important as they suggest that monetary policy in Germany could be guided by the slope of the term structure.     

Blockchain and cryptocurrencies: economic and financial research

Decisions in Economics and Finance - The motivation of proposing and editing the Special Issue “Blockchain and cryptocurrencies” came from the inspirational invited and contributed...     

Parental occupation and children’s school outcomes in math.

We investigate the relationship between math attitude and students’ math scores using data obtained from PISA 2012 and a 2SLS model. Math attitude is approximated by an indicator that takes into account intangible (parental attitude, student instrumental motivation and student math anxiety) and tangible (parental help in math homework) factors. The presence of one family member in a math-related career is our instrumental variable. We find that an increase of one standard deviation in math attitude increases the student score by approximately 30 points, a relevant effect since 40 points is the equivalent of one year of schooling.