Testing the asymmetric effects of exchange rate pass‐through in BRICS countries: Does the state of the economy matter?

This paper investigates not only the question of whether there is exchange rate pass‐through (ERPT) but also the extent to which the pass‐through is asymmetric or state‐dependent in the BRICS countries. Using monthly data from 1999:M1 to 2019:M12 and non‐linear smooth transition vector autoregressive (STVAR) model, our results provide evidence of period‐specific ERPT between the upper and lower regime periods, governed by the selected transition variables. The results further suggest that the pass‐through of exchange rate is higher when the economy is experiencing large appreciations and expansions as well as large depreciations and recessions. Theimplication for these findings is that ERPT is strongly affected by the state of the economy.     

Public policy and rural poverty : A system dynamics analysis of a social change effort in Pakistan

This paper attempts to explain why public policies that were expected to alleviate rural poverty in Pakistan have not worked. The analysis is based on a system dynamics model that incorporates the income distribution processes of a typical developing country agrarian economy consisting of a capitalist and self-employed sector. Only the economic factors arising out of the rational decisions of the two sectors regarding production and disbursement of income have been taken into account. These factors are considered adequate for explaining the persistence of rural poverty, although the role of social and political factors is acknowledged.The study suggests that the absence of an economic force that should encourage land ownership by its cultivators is a key factor responsible for the poor economic condition of the working rural household that form the majority of the rural population. Land is easily separated from cultivators and is concentrated among the few capitalist households. This concentration significantly reduces income in self-employment and thus leaves the cultivators with very little bargaining power for negotiating compensation for thier labor. Thus development policies striving to increase productivity may only serve to increase the claim to income of the few capitalist households, leaving incomes of the majority of the households unchanged while also assuring continuation of low worker compensation.The study indicates that a development policy for alleviating poverty should simultaneously incorporate fiscal instruments to encourage transfer of land ownership to its cultivators and measures that help increase the productivity of land.     

The relationship between laissez-faire leadership and burnout: Mediation through work alienation and the moderating role of political skill

We tested the relationship between laissez-faire leadership and job burnout and the mediating role of work alienation in this relationship. We also examined the moderating role of political skill in the relationship between laissez-faire leadership and burnout. Based on time-lagged (three waves, two months apart) survey data collected from 272 employees in 92 firms operating in China, our results showed that laissez-faire leadership was positively related to burnout both directly and via work alienation. Moreover, the positive relationship between laissez-faire leadership and burnout was contingent on political skill, such that the relationship was weak when political skill was high. The study provides useful suggestions to help managers curb employees' feelings of burnout and work alienation.     

Valuing Homeownership

Housing tenure decision combines financial, economic and socio-psychological factors. This paper considers the global premium associated to homeownership. On the one hand, homeownership is associated to private benefits of being an owner. On the other hand, overinvestment in housing is harmful to diversification and distorts portfolio management. This trade-off, similar to the one associated to corporate private benefits of control, is the cornerstone of our theoretical model based on the expected utility maximization. The originality of the model comes from its simplicity. Furthermore, the empirical implementation of the model, using price and rent data normalized by square-meter, exhibits a homeownership premium for houses in the Brussels Region reaching at least 9% of the housing price. The findings are robust to several methodological refinements. In particular, they confirm the link between liquidity constraints and house prices documented in the literature. However, the premium may largely vary from one place to another, according to tax laws, cultural habits and social status associated to tenure.     

Want to make me emotional? The influence of emotional advertisements on women’s consumption behavior

A wide difference of opinion exists about the content and composition of emotions. Advertising may influence an audience and their buying decisions about products and services. The objective of this study is to better conceptualize how women emotionally respond to emotional advertisements (EAs). The variant views are integrated into an ACE model, composed of subordinate levels of emotions (E), celebrity endorsements (C), and appeal drivers (A). This empirical study examines women’s emotional response using data from 240 Chinese women respondents. The study participants were invited to develop ACE mix based advertisements and fill out questionnaires. PLS-SEM analysis, a novel approach in ACE advertisement development and its applicability to consumer behavior, was used. The results show that showbiz celebrities expressing the emotion of happiness with music and color make the most effective ACE mix to influence the consumption behavior of women. The results are significantly mediated by attention levels and are widely applicable in the burgeoning advertising industry. The study also calls for further research with different ACE mixes in different contexts and on different audiences. It also opens doors for policy making and an appropriate understanding of women’s consumption behavior in the Chinese context.     

Exchange rate undervaluation and manufactured exports: A deliberate strategy?

Recent literature suggests that a proactive exchange rate policy in accordance with price incentives (i.e. undervaluation) can foster manufactured exports and growth. This paper is built on these recent developments and investigates, using a sample of 52 developing countries, whether such a proactive exchange rate policy is adopted. The results show that during the period 1991–2005 a number of countries has used undervaluation to foster the price competitiveness of manufactured exports.     

A Structural Break Analysis of Fiscal Deficit Process in Nigeria

The study examined the sustainability of fiscal policy process in Nigeria for the period 1961 to 2013, using ARDL cointegrating method between government revenue and government expenditure. The Bai-Perron multiple break point tests showed that there was structural shift in variables in 1981 which accounted for unsustainable fiscal deficit throughout the period. It was however, found that fiscal deficit before 1981(1961–1980) was weakly sustainable, while the estimation after 1981(1982–2013) indicated strong sustainability of fiscal policy in Nigeria. We therefore recommend that government should continue with the policies put in place by successive governments since 1982 to ensure stability of macroeconomics environment.     

Does the Quality of Institutions Limit the MENA's Integration in the World Economy?

Using a large sample of countries over the 1990s, this paper examines the extent to which institutions’ functioning disables a greater participation of the Middle East and North Africa (MENA) in the world economy. It focuses on the impact on manufactured exports and FDI attractiveness and considers a broad index of political risk as well as indices targeted toward specific aspects of governance (corruption, government effectiveness and the rule of law). The results are robust to different econometric approaches and lend strong support to the hypothesis that the functioning of institutions may disable the participation of MENA countries in the world economy. They suggest that the impact of an improvement in the quality of institutions may result in a sensitive increase of FDI inflows and manufactured exports. That increase is comparable to the one resulting from liberalisation policies. Hence, although institutional reforms can take time, they deserve the necessary efforts given their outcomes as compared to other reforms.     

Affects of alliance entrepreneurship on common vision,alliance capability and alliance performance

The underlying theoretical argument of our study concerns that value from alliance knowledge may be created not only through exploitation and augmentation of the existing organizational knowledge base, but more through entrepreneurial actions in accessing and integrating key strategic resources that exist in the alliance relationship. In this view, our study investigates the role of alliance entrepreneurship with its effects on common vision, alliance capability and alliance performance in penetrating into the foreign markets. This study develops and empirically tests a model that specifically focuses on (1) to what extent alliance entrepreneurship relates to developing a common vision between alliance and organizational knowledge, (2) to what extent alliance entrepreneurship relates to the alliance capability and alliance performance respectively, and (3) to what extent barriers to alliance knowledge acquisition and learning orientation moderate the relationship between alliance entrepreneurship and alliance capability.Based on a sample of 100 ICT firms, findings of our study reveal a positive and significant affect of alliance entrepreneurship on common vision, alliance capability and alliance performance. However, more significant support is received for the relation between alliance entrepreneurship and alliance capability through moderating interaction effects of barriers to alliance knowledge acquisition and firm level learning orientation.