Mapinduzi Daima – Revolution Forever : Using the 1964 Revolution in Nationalistic Political Discourses in Zanzibar

This Master's thesis examines two opposite nationalistic discourses on the revolution of Zanzibar. Chama cha Mapinduzi (CCM), the party in power since the 1964 revolution defends its revolutionary and "African" heritage in the current multi-party system. New nationalists, including among others the main opposition party Civic United Front (CUF), question both the 1964 revolution and the post-revolution period and blame CCM for empty promises, corruption and ethnic discrimination. This study analyzes the role of a significant historical event in the creation of nationalistic ideology and national identity. The 1964 revolution forms the nucleus of various debates related to the history of Zanzibar: slavery, colonialism, racial discrimination and political violence. Representations of these Social constructivist principles form the basis of this study, and central concepts in the theoretical framework are nationalism, national identity, ethnicity and race. I use critical discourse analysis as my research method, lean on the work by Teun A. van Dijk and Norman Fairclough as the most significant researchers in this field. I examine particularly the ways in which linguistic methods, such as stereotypes and metaphors are used to form in- and out-groups ("us" vs. "others"). My material, both in Swahili and English, was collected mainly in Tanzania in the fall of 2007 and from online sources in the spring of 2009. It includes publications by the Zanzibari government between the years of 1964-2000 (12), official speeches for the Revolution Day or the Union Day (12), articles from Tanzanian newspapers from the 1990s until the year of 2009 (15), memoirs and political pamphlets (10), blog posts and opinion pieces from four different websites (8), and interviews or personal communication in Zanzibar, Dar es Salaam and Uppsala (8). Nationalistic rhetoric often creates enemy images by using binary good-bad oppositions. Both discourses in this study build identities on the basis of "otherness" and exclusion, with the intent of emphasizing the particularity of the own group and excluding "evilness" outside the own reference group. These opposite views on the 1964 revolution as the main axis of the history of Zanzibar build different portraits of the nation and Zanzibari-ness (Uzanzibari). CCM still relies on the pre-revolutionary enemy images of Arabs as selfish rulers and cruel slave traders. For CCM, Zanzibar is primarily an "African" nation and a part of Tanzania which is threatened by "Arabs", the outsiders. In contrast, the new nationalists stress the long history of Zanzibar as multi-racial, cosmopolitan and formerly independent country which has its own, separate culture and identity from mainland Tanzanians. Heshima, honour/respect, one of the basic values of Swahili culture, occupies a central role in both discourses: the main party emphasizes that the revolution returned "heshima" to the Zanzibari Africans after centuries of humiliation, whereas the new nationalists claim that ever since the revolution all "non-Africans" have been humiliated and lost their "heshima". According to the new nationalists, true Zanzibari values which include tolerance and harmony between different "races" were lost when the "foreign" revolutionaries arrived from the mainland. Consequently, they see the 1964 revolution as Tanganyikan colonialism which began with the help of Western countries, and maintain that this "colonialism" still continues in the violent multi-party elections.

Intraday Dynamics of International Equity Markets

The increased availability of high frequency data sets have led to important new insights in understanding of financial markets. The use of high frequency data is interesting and persuasive, since it can reveal new information that cannot be seen in lower data aggregation. This dissertation explores some of the many important issues connected with the use, analysis and application of high frequency data. These include the effects of intraday seasonal, the behaviour of time varying volatility, the information content of various market data, and the issue of inter market linkages utilizing high frequency 5 minute observations from major European and the U.S stock indices, namely DAX30 of Germany, CAC40 of France, SMI of Switzerland, FTSE100 of the UK and SP500 of the U.S. The first essay in the dissertation shows that there are remarkable similarities in the intraday behaviour of conditional volatility across European equity markets. Moreover, the U.S macroeconomic news announcements have significant cross border effect on both, European equity returns and volatilities. The second essay reports substantial intraday return and volatility linkages across European stock indices of the UK and Germany. This relationship appears virtually unchanged by the presence or absence of the U.S stock market. However, the return correlation among the U.K and German markets rises significantly following the U.S stock market opening, which could largely be described as a contemporaneous effect. The third essay sheds light on market microstructure issues in which traders and market makers learn from watching market data, and it is this learning process that leads to price adjustments. This study concludes that trading volume plays an important role in explaining international return and volatility transmissions. The examination concerning asymmetry reveals that the impact of the positive volume changes is larger on foreign stock market volatility than the negative changes. The fourth and the final essay documents number of regularities in the pattern of intraday return volatility, trading volume and bid-ask spreads. This study also reports a contemporaneous and positive relationship between the intraday return volatility, bid ask spread and unexpected trading volume. These results verify the role of trading volume and bid ask quotes as proxies for information arrival in producing contemporaneous and subsequent intraday return volatility. Moreover, asymmetric effect of trading volume on conditional volatility is also confirmed. Overall, this dissertation explores the role of information in explaining the intraday return and volatility dynamics in international stock markets. The process through which the information is incorporated in stock prices is central to all information-based models. The intraday data facilitates the investigation that how information gets incorporated into security prices as a result of the trading behavior of informed and uninformed traders. Thus high frequency data appears critical in enhancing our understanding of intraday behavior of various stock markets’ variables as it has important implications for market participants, regulators and academic researchers.

Essays on Market Microstructure: Price Discovery and Informed Trading

Market microstructure is “the study of the trading mechanisms used for financial securities” (Hasbrouck (2007)). It seeks to understand the sources of value and reasons for trade, in a setting with different types of traders, and different private and public information sets. The actual mechanisms of trade are a continually changing object of study. These include continuous markets, auctions, limit order books, dealer markets, or combinations of these operating as a hybrid market. Microstructure also has to allow for the possibility of multiple prices. At any given time an investor may be faced with a multitude of different prices, depending on whether he or she is buying or selling, the quantity he or she wishes to trade, and the required speed for the trade. The price may also depend on the relationship that the trader has with potential counterparties. In this research, I touch upon all of the above issues. I do this by studying three specific areas, all of which have both practical and policy implications. First, I study the role of information in trading and pricing securities in markets with a heterogeneous population of traders, some of whom are informed and some not, and who trade for different private or public reasons. Second, I study the price discovery of stocks in a setting where they are simultaneously traded in more than one market. Third, I make a contribution to the ongoing discussion about market design, i.e. the question of which trading systems and ways of organizing trading are most efficient. A common characteristic throughout my thesis is the use of high frequency datasets, i.e. tick data. These datasets include all trades and quotes in a given security, rather than just the daily closing prices, as in traditional asset pricing literature. This thesis consists of four separate essays. In the first essay I study price discovery for European companies cross-listed in the United States. I also study explanatory variables for differences in price discovery. In my second essay I contribute to earlier research on two issues of broad interest in market microstructure: market transparency and informed trading. I examine the effects of a change to an anonymous market at the OMX Helsinki Stock Exchange. I broaden my focus slightly in the third essay, to include releases of macroeconomic data in the United States. I analyze the effect of these releases on European cross-listed stocks. The fourth and last essay examines the uses of standard methodologies of price discovery analysis in a novel way. Specifically, I study price discovery within one market, between local and foreign traders.

Essays on the Role of Time in Price Discovery (summary section only)

The purpose of this thesis is to examine the role of trade durations in price discovery. The motivation to use trade durations in the study of price discovery is that durations are robust to many microstructure effects that introduce a bias in the measurement of returns volatility. Another motivation to use trade durations in the study of price discovery is that it is difficult to think of economic variables, which really are useful in the determination of the source of volatility at arbitrarily high frequencies. The dissertation contains three essays. In the first essay, the role of trade durations in price discovery is examined with respect to the volatility pattern of stock returns. The theory on volatility is associated with the theory on the information content of trade, dear to the market microstructure theory. The first essay documents that the volatility per transaction is related to the intensity of trade, and a strong relationship between the stochastic process of trade durations and trading variables. In the second essay, the role of trade durations in price discovery is examined with respect to the quantification of risk due to a trading volume of a certain size. The theory on volume is intrinsically associated with the stock volatility pattern. The essay documents that volatility increases, in general, when traders choose to trade with large transactions. In the third essay, the role of trade durations in price discovery is examined with respect to the information content of a trade. The theory on the information content of a trade is associated with the theory on the rate of price revisions in the market. The essay documents that short durations are associated with information. Thus, traders are compensated for responding quickly to information

Hedging Options with Different Time Units in the Pricing Models

This study examined the effects of the Greeks of the options and the trading results of delta hedging strategies, with three different time units or option-pricing models. These time units were calendar time, trading time and continuous time using discrete approximation (CTDA) time. The CTDA time model is a pricing model, that among others accounts for intraday and weekend, patterns in volatility. For the CTDA time model some additional theta measures, which were believed to be usable in trading, were developed. The study appears to verify that there were differences in the Greeks with different time units. It also revealed that these differences influence the delta hedging of options or portfolios. Although it is difficult to say anything about which is the most usable of the different time models, as this much depends on the traders view of the passing of time, different market conditions and different portfolios, the CTDA time model can be viewed as an attractive alternative.