Arbitration proceeding – determination of “market price” – subpoena under Commercial Arbitration Act 1990 s 17

AGL Wholesale Gas Ltd v Origin Energy Ltd [2008] QCA 366 involved an appeal against the setting aside of paragraphs of a subpoena issued under s 17 of the Commercial Arbitration Act 1990 (Qld). The Court was satisfied that even if the documents were of “apparent relevance” to the subject matter of the proceedings, it would nevertheless be oppressive to require their production.

The effect of project information on the accuracy of building price forecasts

A fundamental proposition is that the accuracy of the designer's tender price forecasts is positively correlated with the amount of information available for that project. The paper describes an empirical study of the effects of the quantity of information available on practicing Quantity Surveyors' forecasting accuracy. The methodology involved the surveyors repeatedly revising tender price forecasts on receipt of chunks of project information. Each of twelve surveyors undertook two projects and selected information chunks from a total of sixteen information types. The analysis indicated marked differences in accuracy between different project types and experts/non-experts. The expert surveyors' forecasts were not found to be significantly improved by information other than that of basic building type and size, even after eliminating project type effects. The expert surveyors' forecasts based on the knowledge of building type and size alone were, however, found to be of similar accuracy to that of average practitioners pricing full bills of quantities.

Heuristics and building price forecasting

The construction industry contains two types of estimators the contractors' estimator and the designers' price forecaster. Each has two models of the building in which to systemize his procedures - the production model and the design model. The use of these models is discussed in the light of the industry's particular problems of complexity and uncertainty together with the pressures of the market. It is argued that estimators and forecasters, in order to function effectively in these conditions, are forced to exercise a high degree of subjective judgment. Means of eliciting good heuristics involved in judgment making are considered by reference to the artificial intelligence and construction literature and a methodology is proposed based on these findings. The results of two early trials of the method with students are given, indicating the usefulness of the approach.

What drives the commodity price beta of oil industry stocks

We test theoretical drivers of the oil price beta of oil industry stocks. The strongest statistical and economic support comes for market conditions-type variables as the prime drivers: namely, oil price (+), bond rate (+), volatility of oil returns (−) and cost of carry (+). Though statistically significant, exogenous firm characteristics and oil firms' financing decisions have less compelling economic significance. There is weaker support for the prediction that financial risk management reduces the exposure of oil stocks to crude oil price variation. Finally, extended modelling shows that mean reversion in oil prices also helps explain cross-sectional variation in the oil beta.

Ownership, corporate governance and timeliness of price discovery : Australian evidence

This study investigates whether and how a firm’s ownership and corporate governance affect its timeliness of price discovery, which is referred to as the speed of incorporation of value-relevant information into the stock price. Using a panel data of 1,138 Australian firm-year observations from 2001 to 2008, we predict and find a non-linear relationship between ownership concentration and the timeliness of price discovery. We test the identity of the largest shareholder and find that only firms with family as the largest shareholder exhibit faster price discovery. There is no evidence that suggests that the presence of a second largest shareholder affects the timeliness of price discovery materially. Although we find a positive association between corporate governance quality and the timeliness of price discovery, as expected, there is no interaction effect between the largest shareholding and corporate governance in relation to the timeliness of price discovery. Further tests show no evidence of severe endogeneity problems in our study.

Industrial land price and its impact on urban growth : a Chinese case study

China is experiencing rapid progress in industrialization, with its own rationale toward industrial land development based on a deliberate change from an extensive to intensive form of urban land use. One result has been concerted attempts by local government to attract foreign investment by a low industrial land price strategy, which has resulted in a disproportionally large amount of industrial land within the total urban land use structure at the expense of the urban sprawl of many cities. This paper first examines “Comparable Benchmark Price as Residential land use” (CBPR) as the theoretical basis of the low industrial land price phenomenon. Empirical findings are presented from a case study based on data from Jinyun County, China. These data are analyzed to reveal the rationale of industrial land price from 2000 to 2010 concerning the CBPR model. We then explore the causes of low industrial land prices in the form of a “Centipede Game Model”, involving two neighborhood regions as “major players” to make a set of moves (or strategies). When one of the players unilaterally reduces the land price to attract investment with the aim to maximize profits arising from the revenues generated from foreign investment and land premiums, a two-player price war begins in the form of a dynamic game, the effect of which is to produce a downward spiral of prices. In this context, the paradox of maximizing profits for each of the two players are not accomplished due to the inter-regional competition of attracted investment leading to a lose-lose situation for both sides’ in competing for land premium revenues. A short-term solution to the problem is offered involving the establishment of inter-regional cooperative partnerships. For the longer term, however, a comprehensive reform of the local financial system, more adroit regional planning and an improved means of evaluating government performance is needed to ensure the government's role in securing pubic goods is not abandoned in favor of one solely concerned with revenue generation.

Modeling electricity price events as point processes

Energy prices are highly volatile and often feature unexpected spikes. It is the aim of this paper to examine whether the occurrence of these extreme price events displays any regularities that can be captured using an econometric model. Here we treat these price events as point processes and apply Hawkes and Poisson autoregressive models to model the dynamics in the intensity of this process.We use load and meteorological information to model the time variation in the intensity of the process. The models are applied to data from the Australian wholesale electricity market, and a forecasting exercise illustrates both the usefulness of these models and their limitations when attempting to forecast the occurrence of extreme price events.

The impact of the clean development mechanism (CDM) on the cost price of wind power electricity : a China study

As a renewable energy source, wind power is playing an increasingly important role in China’s electricity supply. Meanwhile, China is also the world’s largest market for Clean Development Mechanism (CDM) wind power projects. Based on the data of 27 wind power projects of Inner Mongolia registered with the Executive Board of the United Nations (EB) in 2010, this paper constructs a financial model of Net Present Value (NPV) to analyze the cost of wind power electricity. A sensitivity analysis is then conducted to examine the impact of different variables with and without Certified Emission Reduction (CER) income brought about by the CDM. It is concluded that the CDM, along with static investment and annual wind electricity production, is one of the most significant factors in promoting the development of wind power in China. Additionally, wind power is envisaged as a practical proposition for competing with thermal power if the appropriate actions identified in the paper are made.

The effect of consumer education on unit price usage : an early exploratory study

Consumer awareness and usage of Unit Price (UP) information continues to hold academic interest. Originally designed as a device to enable shoppers to make comparisons between grocery products, it is argued consumers still lack a sufficient understanding of the device. Previous research has tended to focus on product choice, effect of time, and structural changes to price presentation. No studies have tested the effect of UP consumer education on grocery shopping expenditure. Supported by distributed learning theories, this is the first study to condition participants over a twenty week period, to comprehend and employ UP information while shopping. A 3x5 mixed factorial design was employed to collect data from 357 shoppers. A 3 (Control, Massed, Spaced) x 5 (Time Point: Week 0, 5, 10, 15 and 20) mixed factorial analysis of variance (ANOVA) was performed to analyse the data. Preliminary results revealed that the three groups differed in their average expenditure over the twenty weeks. The Control group remained stable across the five time points. Results indicated that both intensive (Massed) and less intensive (Spaced) exposure to UP information achieved similar results, with both group reducing average expenditure similarly by Week 5. These patterns held for twenty weeks, with conditioned groups reducing their grocery expenditure by over 10%. This research has academic value as a test of applied learning theories. We argue, retailers can attain considerable market advantages as efforts to enhance customers’ knowledge, through consumer education campaigns, can have a positive and strong impact on customer trust and goodwill toward the organisation. Hence, major practical implications for both regulators and retailers exist.

Monitoring the price and affordability of foods and diets globally

Food prices and food affordability are important determinants of food choices, obesity and non-communicable diseases. As governments around the world consider policies to promote the consumption of healthier foods, data on the relative price and affordability of foods, with a particular focus on the difference between ‘less healthy’ and ‘healthy’ foods and diets, are urgently needed. This paper briefly reviews past and current approaches to monitoring food prices, and identifies key issues affecting the development of practical tools and methods for food price data collection, analysis and reporting. A step-wise monitoring framework, including measurement indicators, is proposed. ‘Minimal’ data collection will assess the differential price of ‘healthy’ and ‘less healthy’ foods; ‘expanded’ monitoring will assess the differential price of ‘healthy’ and ‘less healthy’ diets; and the ‘optimal’ approach will also monitor food affordability, by taking into account household income. The monitoring of the price and affordability of ‘healthy’ and ‘less healthy’ foods and diets globally will provide robust data and benchmarks to inform economic and fiscal policy responses. Given the range of methodological, cultural and logistical challenges in this area, it is imperative that all aspects of the proposed monitoring framework are tested rigorously before implementation.

City relative price dynamics in Australia : are structural breaks important?

This paper examines the dynamic behaviour of relative prices across seven Australian cities by applying panel unit root test procedures with structural breaks to quarterly consumer price index data for 1972 Q1–2011 Q4. We find overwhelming evidence of convergence in city relative prices. Three common structural breaks are endogenously determined at 1985, 1995, and 2007. Further, correcting for two potential biases, namely Nickell bias and time aggregation bias, we obtain half-life estimates of 2.3–3.8 quarters that are much shorter than those reported by previous research. Thus, we conclude that both structural breaks and bias corrections are important to obtain shorter half-life estimates.