Zero-non-zero patterned vector error correction modeling for I(2) cointegrated time series with applications in testing PPP and stock market relationships

Vector error-correction models (VECMs) have become increasingly important in their application to financial markets. Standard full-order VECM models assume non-zero entries in all their coefficient matrices. However, applications of VECM models to financial market data have revealed that zero entries are often a necessary part of efficient modelling. In such cases, the use of full-order VECM models may lead to incorrect inferences. Specifically, if indirect causality or Granger non-causality exists among the variables, the use of over-parameterised full-order VECM models may weaken the power of statistical inference. In this paper, it is argued that the zero–non-zero (ZNZ) patterned VECM is a more straightforward and effective means of testing for both indirect causality and Granger non-causality. For a ZNZ patterned VECM framework for time series of integrated order two, we provide a new algorithm to select cointegrating and loading vectors that can contain zero entries. Two case studies are used to demonstrate the usefulness of the algorithm in tests of purchasing power parity and a three-variable system involving the stock market.

Relationship between franking credits and the market risk premium

In a dividend imputation tax system, equity investors have three potential sources of return: dividends, capital gains and franking (tax) credits. However, the standard procedures for estimating the market risk premium (MRP) for use in the capital asset pricing model, ignore the value of franking credits. Officer (1994) notes that if franking credits do affect the corporate cost of capital, their value must be added to the standard estimates of MRP. In the present paper, we explicitly derive the relationship between the value of franking credits (gamma) and the MRP. We show that the standard parameter estimates that have been adopted in practice (especially by Australian regulators) violate this deterministic mathematical relationship. We also show how information on dividend yields and effective tax rates bounds the values that can be reasonably used for gamma and the MRP. We make recommendations for how estimates of the MRP should be adjusted to reflect the value of franking credits in an internally consistent manner.

Energy consumption, economic growth and prices: A reassessment using panel VECM for developed and developing countries

This paper reinvestigates the energy consumption-GDP growth nexus in a panel error correction model using data on 20 net energy importers and exporters from 1971 to 2002. Among the energy exporters, there was bidirectional causality between economic growth and energy consumption in the developed countries in both the short and long run, while in the developing countries energy consumption stimulates growth only in the short run. The former result is also found for energy importers and the latter result exists only for the developed countries within this category. In addition, compared to the developing countries, the developed countries' elasticity response in terms of economic growth from an increase in energy consumption is larger although its income elasticity is lower and less than unitary. Lastly. the implications for energy policy calling for a more holistic approach are discussed. (c) 2006 Elsevier Ltd. All rights reserved.

Globalisation and the reconstruction of the literate child

In New Zealand, the turn from the welfare state since 1984 to a global market driven economy in the early mid 1990s has affected the way that primary curriculum documents have been developed and implemented. Those documents, together with teachers’ handbooks, have in turn affected the way that teachers teach. In particular, the construction of literacy and what constitutes literacy teaching in these documents have affected teachers’ work and have also constructed and are reconstructing childhood and the child literate. The way that teachers teach literacy depends on their constructions of children and childhood and that as their views of childhood and children change, so too do their views of the teaching of literacy. Against this background of locating childhood and children in educational and literacy discourses, other discourses of new technologies, cultural diversity, time and space of “new times” are also challenging the construction of literacy, the literate child and childhood.

Diversity and change in Australia's rangelands: a post-productivist transition with a difference?

Australia's rangelands are experiencing a post-productivist transition at a tempo comparable to Western Europe's, but in contexts that ensure marked divergence in impulses, actors, processes and outcomes. In Australia's most marginal lands, a flimsy mode of pastoral occupance is being displaced by renewed indigenous occupance, conservation and tourism, with significant changes in land ownership, property rights, investment sources and power relations, but also with structural problems arising from fugitive income streams. The sharp delineation between structurally coherent commodity-oriented regions and emerging amenity-oriented regions can provisionally be mapped at a national scale. A comparison of Australia with Western Europe indicates that three distinct but interconnected driving forces are propelling the rural transition, namely: agricultural overcapacity; the emergence of amenity-oriented uses; and changing societal values.

Exploring the characteristics of the market-driven firms and antecedents to sustained competitive advantage

During the last few decades, identifying and examining the characteristics of market-driven firms have been a dominant theme in strategic marketing research. It has been argued that market-driven firms are superior in their market sensing and customer linking capabilities, enabling market-driven firms to outperform their competitors. This paper reports the findings of a study that examines the role market-focused learning capability and marketing capability in innovation-based competitive strategy on sustainable competitive advantage. The findings indicate that entrepreneurship is an important factor in sustained competitive advantage (SCA) and while market-focused learning capability leads to higher degrees of innovation, marketing capability enables SCA. (C) 2003 Elsevier Inc. All rights reserved.

A comparison of attitudes among purchasers of imported fruit in Guangzhou and Urumqi, China

Research on Chinese consumer behavior is dominated by studies of Chinese consumers as a whole, or studies of consumers in a single city or region. Comparative studies that take into account the cultural, economic and demographic differences between contrasting markets within China are poorly represented in the literature. The widening economic gap between rapidly developing coastal cities and less developed cities in more remote regions provides an opportunity for comparative consumer studies. In this research we compared the responses of buyers of imported fruit in two very different cites, Guangzhou (highly developed) and Urumqi (relatively undeveloped). Results revealed that buyers' beliefs and their evaluation of those beliefs towards the attributes of imported fruit were distinctly different. Factors such as the city's background, consumers' education level and the intended uses explained most of these differences. Results will help to broaden our understanding of Chinese consumer behavior and provide valuable information when formulating marketing strategies. (C) 2003 Elsevier Ltd. All rights reserved.

Experimental study of the quantum driven pendulum and its classical analog in atom optics

We present experimental results for the dynamics of cold atoms in a far detuned amplitude-modulated optical standing wave. Phase-space resonances constitute distinct peaks in the atomic momentum distribution containing up to 65% of all atoms resulting from a mixed quantum chaotic phase space. We characterize the atomic behavior in classical and quantum regimes and we present the applicable quantum and classical theory, which we have developed and refined. We show experimental proof that the size and the position of the resonances in phase space can be controlled by varying several parameters, such as the modulation frequency, the scaled well depth, the modulation amplitude, and the scaled Planck’s constant of the system. We have found a surprising stability against amplitude noise. We present methods to accurately control the momentum of an ensemble of atoms using these phase-space resonances which could be used for efficient phase-space state preparation.

Control of vector-borne disease by genetic manipulation of insect populations: technological requirements and research priorities

The possibility of controlling vector-borne disease through the development and release of transgenic insect vectors has recently gained popular support and is being actively pursued by a number of research laboratories around the world. Several technical problems must be solved before such a strategy could be implemented: genes encoding refractory traits (traits that render the insect unable to transmit the pathogen) must be identified, a transformation system for important vector species has to be developed, and a strategy to spread the refractory trait into natural vector populations must be designed. Recent advances in this field of research make it seem likely that this technology will be available in the near future. In this paper we review recent progress in this area as well as argue that care should be taken in selecting the most appropriate disease system with which to first attempt this form of intervention. Much attention is currently being given to the application of this technology to the control of malaria, transmitted by Anopheles gambiae in Africa. While malaria is undoubtedly the most important vector-borne disease in the world and its control should remain an important goal, we maintain that the complex epidemiology of malaria together with the intense transmission rates in Africa may make it unsuitable for the first application of this technology. Diseases such as African trypanosomiasis, transmitted by the tsetse fly, or unstable malaria in India may provide more appropriate initial targets to evaluate the potential of this form of intervention.

Evaluating Flexible Transport Solutions

Flexible transport services (FTS) have been of increasing interest in developed countries as a bridge between the use of personal car travel and fixed route transit services. This paper reports on findings from a recent study in Queensland Australia, which identified lessons from an international review and implications for Australia. Potential strategic directions, including a vision, mission, key result areas, strategies, and identified means of measuring performance are described. Evaluation criteria for assessing flexible transport proposals were developed, and approaches to identifying and assessing needs and demands outlined. The use of emerging technologies is also a key element of successful flexible transport services.

Public policy in knowledge-based economies: Foundations and frameworks

Knowledge is a product of human social systems and, therefore, the foundations of the knowledge-based economy are social and cultural. Communication is central to knowledge creation and diffusion, and Public Policy in Knowledge-Based Economies highlights specific social and cultural conditions that can enhance the communication, use and creation of knowledge in a society.The purpose of this book is to illustrate how these social and cultural conditions are identified and analysed through new conceptual frameworks. Such frameworks are necessary to penetrate the surface features of knowledge-based economies - science and technology - and disclose what drives such economies.This book will provide policymakers, analysts and academics with the fundamental tools needed for the development of policy in this little understood and emerging area.