Exchange rate exposure : do size and foreign operations matter?

Purpose – The purpose of this paper is to examine the effect of firm size and foreign operations on the exchange rate exposure of UK non-financial companies from January 1981 to December 2001. Design/methodology/approach – The impact of the unexpected changes in exchange rates on firms’ stock returns is examined. In addition, the movements in bilateral, equally weighted (EQW) and trade-weighted and exchange rate indices are considered. The sample is classified according to firm size and the extent of firms’ foreign operations. In addition, structural changes on the relationship between exchange rate changes and individual firms’ stock returns are examined over three sub-periods: before joining the exchange rate mechanism (pre-ERM), during joining the ERM (in-ERM), and after departure from the ERM (post-ERM). Findings – The findings indicate that a higher percentage of UK firms are exposed to contemporaneous exchange rate changes than those reported in previous studies. UK firms’ stock returns are more affected by changes in the EQW, and US$ European currency unit exchange rate, and respond less significantly to the basket of 20 countries’ currencies relative to the UK pound exchange rate. It is found that exchange rate exposure has a more significant impact on stock returns of the large firms compared with the small and medium-sized companies. The evidence is consistent across all specifications using different exchange rate. The results provide evidence that the proportion of significant foreign exchange rate exposure is higher for firms which generate a higher percentage of revenues from abroad. The sensitivities of firms’ stock returns to exchange rate fluctuations are most evident in the pre-ERM and post-ERM periods. Practical implications – This study provides important implications for public policymakers, financial managers and investors on how common stock returns of various sectors react to exchange rate fluctuations. Originality/value – The empirical evidence supports the view that UK firms’ stock returns are affected by foreign exchange rate exposure.

The exchange rate exposure of UK non-financial companies

Purpose – The purpose of this paper is to investigate the exchange rate exposure of UK nonfinancial companies from January 1981 to December 2001. Design/methodology/approach – The study employs different exchange rate measures and adopts an equally weighted exchange rate. The analyses are conducted at the firm level. All analyses are conducted by regressing the firm’s exchange rate exposure coefficients on its size, foreign activity variables and financial hedging proxies over the whole sample period. Findings – The findings show that a higher percentage of UK non-financial companies are exposed to exchange rate changes than those reported in previous studies. Generally, the results provide a stronger support for the suggested equally weighted rate as an economic variable, which affects firms’ stock returns. The results also show a high proportion of positive exposure coefficients among firms with significant exchange rate exposure, indicating a higher proportion of firms benefiting from an appreciation of the pound. Finally, the results also indicate evidence that firms’ foreign operations and hedging variables affect their sensitivity to exchange rate exposure. Practical implications – This study provides important implications for public policymakers who wish to understand links between policies that affect exchange rates and relative wealth effects. Originality/value – The empirical results of this study should help investors to examine how common stock returns react to exchange rate fluctuations when making financial decisions, and prove useful for financial managers when measuring exposure to foreign exchange rate changes.

Antecedents and outcomes of abusive supervision:test of a trickle-down model

The authors examined antecedents of abusive supervision and the relative importance of interactional and procedural justice as mediators of the relationship between abusive supervision and the work outcomes of affective organizational commitment and individual- and organization-directed citizenship behaviors. Data were obtained from subordinate-supervisor dyads from a telecommunication company located in southeastern China. Results of moderated regression analysis revealed that authoritarian leadership style moderated the relationship between supervisors' perceptions of interactional justice and abusive supervision such that the relationship was stronger for supervisors high rather than low in authoritarian leadership style. In addition, results of structural equation modeling analysis revealed that subordinates' perceptions of interactional but not procedural justice fully mediated the relationship between abusive supervision and the work outcomes. Implications for future investigations of abusive supervision are discussed. Copyright 2007 by the American Psychological Association.

Post-Bretton Woods evidence on PPP under different exchange rate regimes

This article investigates the behaviour of exchange rates across different regimes for a post-Bretton Woods period. The exchange rate regime classification is based on the classification of Frankel et al. (2004) who condensed the 10 categories of exchange rate regimes reported by the International Monetary Fund (IMF) into three categories. Panel unitroot tests and panel cointegration are used to examine the Purchasing Power Parity (PPP) hypothesis. The latter test is used to check for both the weak and strong forms of PPP. The panel unit-root tests show no evidence of PPP and suggest there is no difference in the behaviour of exchange rates across different regimes. However, failure to detect PPP across any of the regimes could be due to structural breaks. This assumption is reinforced by the results of cointegration tests, which suggest that there exists at least a weak form of PPP for the different regimes. The evidence for strong PPP decreases as the exchange rate regime moves away from a flexible exchange rate regime.

Trust as a mediator of the relationship between organizational justice and work outcomes:test of a social exchange model

Data obtained from full-time employees of a public sector organization in India were used to test a social exchange model of employee work attitudes and behaviors. LISREL results revealed that whereas the three organizational justice dimensions (distributive, procedural and interactional) were related to trust in organization only interactional justice was related to trust in supervisor. The results further revealed that relative to the hypothesized fully mediated model a partially mediated model better fitted the data. Trust in organization partially mediated the relationship between distributive and procedural justice and the work attitudes of job satisfaction, turnover intentions, and organizational commitment but fully mediated the relationship between interactional justice and these work attitudes. In contrast, trust in supervisor fully mediated the relationship between interactional justice and the work behaviors of task performance and the individually- and organizationally-oriented dimensions of citizenship behavior.

The relative contributions of colour and luminance signals towards the visuomotor localisation of targets in human peripheral vision

We sought to determine the extent to which colour (and luminance) signals contribute towards the visuomotor localization of targets. To do so we exploited the movement-related illusory displacement a small stationary window undergoes when it has a continuously moving carrier grating behind it. We used drifting (1.0-4.2 Hz) red/green-modulated isoluminant gratings or yellow/black luminance-modulated gratings as carriers, each curtailed in space by a stationary, two-dimensional window. After each trial, the perceived location of the window was recorded with reference to an on-screen ruler (perceptual task) or the on-screen touch of a ballistic pointing movement made without visual feedback (visuomotor task). Our results showed that the perceptual displacement measures were similar for each stimulus type and weakly dependent on stimulus drift rate. However, while the visuomotor displacement measures were similar for each stimulus type at low drift rates (<4 Hz), they were significantly larger for luminance than colour stimuli at high drift rates (>4 Hz). We show that the latter cannot be attributed to differences in perceived speed between stimulus types. We assume, therefore, that our visuomotor localization judgements were more susceptible to the (carrier) motion of luminance patterns than colour patterns. We suggest that, far from being detrimental, this susceptibility may indicate the operation of mechanisms designed to counter the temporal asynchrony between perceptual experiences and the physical changes in the environment that give rise to them. We propose that perceptual localisation is equally supported by both colour and luminance signals but that visuomotor localisation is predominantly supported by luminance signals. We discuss the neural pathways that may be involved with visuomotor localization. © 2007 Springer-Verlag.

Effects of the rate of formant-frequency variation on the grouping of formants in speech perception

How speech is separated perceptually from other speech remains poorly understood. Recent research suggests that the ability of an extraneous formant to impair intelligibility depends on the modulation of its frequency, but not its amplitude, contour. This study further examined the effect of formant-frequency variation on intelligibility by manipulating the rate of formant-frequency change. Target sentences were synthetic three-formant (F1?+?F2?+?F3) analogues of natural utterances. Perceptual organization was probed by presenting stimuli dichotically (F1?+?F2C?+?F3C; F2?+?F3), where F2C?+?F3C constitute a competitor for F2 and F3 that listeners must reject to optimize recognition. Competitors were derived using formant-frequency contours extracted from extended passages spoken by the same talker and processed to alter the rate of formant-frequency variation, such that rate scale factors relative to the target sentences were 0, 0.25, 0.5, 1, 2, and 4 (0?=?constant frequencies). Competitor amplitude contours were either constant, or time-reversed and rate-adjusted in parallel with the frequency contour. Adding a competitor typically reduced intelligibility; this reduction increased with competitor rate until the rate was at least twice that of the target sentences. Similarity in the results for the two amplitude conditions confirmed that formant amplitude contours do not influence across-formant grouping. The findings indicate that competitor efficacy is not tuned to the rate of the target sentences; most probably, it depends primarily on the overall rate of frequency variation in the competitor formants. This suggests that, when segregating the speech of concurrent talkers, differences in speech rate may not be a significant cue for across-frequency grouping of formants.

Control-based channel governance and relative dependence

Control and governance theories recognize that exchange partners are subject to two general forms of control, the unilateral authority of one firm and bilateral expectations extending from their social bond. In this way, a supplier both exerts unilateral, authority-based controls and is subject to socially-based, bilateral controls as it attempts to manage its brand successfully through reseller channels. Such control is being challenged by suppliers’ growing relative dependence on increasingly dominant resellers in many industries. Yet the impact of supplier relative dependence on the efficacy of control-based governance in the supplier’s channel is not well understood. To address this gap, we specify and test a control model moderated by relative dependence involving the conceptualization and measurement of governance at the level of specific control processes: incenting, monitoring, and enforcing. Our empirical findings show relative dependence undercuts the effectiveness of certain unilateral and bilateral control processes while enhancing the effectiveness of others, largely supporting our dual suppositions that each control process operates through a specialized behavioral mechanism and that these underlying mechanisms are differentially impacted by relative dependence. We offer implications of these findings for managers and identify our contributions to channel theory and research.

Are poor mathematics skills associated with visual deficits in temporal processing?

Developmental learning disabilities such as dyslexia and dyscalculia have a high rate of co-occurrence in pediatric populations, suggesting that they share underlying cognitive and neurophysiological mechanisms. Dyslexia and other developmental disorders with a strong heritable component have been associated with reduced sensitivity to coherent motion stimuli, an index of visual temporal processing on a millisecond time-scale. Here we examined whether deficits in sensitivity to visual motion are evident in children who have poor mathematics skills relative to other children of the same age. We obtained psychophysical thresholds for visual coherent motion and a control task from two groups of children who differed in their performance on a test of mathematics achievement. Children with math skills in the lowest 10% in their cohort were less sensitive than age-matched controls to coherent motion, but they had statistically equivalent thresholds to controls on a coherent form control measure. Children with mathematics difficulties therefore tend to present a similar pattern of visual processing deficit to those that have been reported previously in other developmental disorders. We speculate that reduced sensitivity to temporally defined stimuli such as coherent motion represents a common processing deficit apparent across a range of commonly co-occurring developmental disorders.

Continous annular chromatography for the separation of carbohydrate mixtures

The continuous separation of beet molasses resulting in a sucrose rich product and a non-sugar waste product was carried out using a rotating annular chromatograph. The annulus was 12 mm wide and 1.4 m long and was packed with a sodium charged 5.5% cross-linked polystyrene ion exchange resin. Separation was achieved by the simultaneous mechanisms of ion exclusion, size exclusion and partition chromatography. The entire packed bed was slowly rotated while beet molasses was fed continuously through a stationary feed nozzle to the top of the bed. Each molasses constituent having a different relative affinity for the packing and the deionised water mobile phase describes a characteristic helical path as it progresses from the stationary feed point to the bottom of the rotating bed. Each solute then elutes from the annulus at a different angular distance from the feed and separation of the multicomponent mixture is thereby achieved. When a 35% w/w sucrose beet molasses feed was used the throughput achievable was 45.1 kg sucrose m~3 resin h"1. In addition to beet molasses separation other carbohydrate mixtures were separated. In particular the separation of glucose and fructose by Ligand exchange chromatography on a calcium charged ion exchange bed was carried out. The effects of flowrates, concentration, rotation rate, temperature and particle size on resolution and dilution of constituents in the mixtures to be separated were studied. A small test rig was designed and built to determine the cause of liquid maldistribution around the annulus. The problem was caused by the porous bed support media becoming clogged with fines being introduced by eluent flows and off the resin. An outer ring was constructed to house the bed support which could be quickly replaced with the onset of maldistribution. The computer simulation of the operation of the rotating annular chromatograph has been carried out successfully.

Ablative pyrolysis of biomass

The primary objectives of this work were to design, construct, test and operate a novel ablative pyrolysis reactor and product recovery system. Other key objectives included the development of an ablative pyrolysis reactor design methodology, mathematical modelling of the ablation process and measurement of empirical ablation rate data at 500°C. The constructed reactor utilised a rotating blade approach to achieve particle ablation in a 258mm internal diameter reactor. By fulfilling the key requirements of high relative motion and high contact pressure, pine wood particles of maximum size 6.35 mm were successfully ablated.Sixteen experiments were carried out: five initial commissioning experiments were used to test the rotating blade concept and to solve char separation problems. Mass balances were obtained for the other eleven experiments with good closures. Based on ablatively pyrolysed dry wood, a maximum organic liquid yield of 65.9 wt% was achieved with corresponding yields of 12.4 wt% char, 11.5 wt% water and 9.2 wt% non-condensable gas. Reactor throughputs of 2 kg/h dry ablated wood were achieved at 600°C. The theoretical ablative pyrolysis reactor design methodology was simplified and improved based upon empirical data derived from wood rod ablation experiments. Yields of chemicals were qualitatively similar to those of other fast pyrolysis processes.The product recovery system, comprising hot char removal, liquids collection in two ice-cooled condensers followed by gas filtration and drying, gave good mass balance closures. The most significant problem was char separation and removal from the reactor. This was solved by using a nitrogen blow line. In general, the reactor and product collection systems performed well.Future development of the reactor would involve modification of the reactor feed tube to allow the reactor residence time to be reduced and testing of the rotating blade approach with different blade angles, configurations and numbers of blades.

Openness and economic growth

The themes of this thesis are that international trade and foreign direct investment (FDI) are closely related and that they have varying impacts on economic growth in countries at different stages of development. The thesis consists of three empirical studies. The first one examines the causal relationship between FDI and trade in China. The empirical study is based on a panel of bilateral data for China and 19 home countries/regions over the period 1984-98. The specific feature of the study is that econometric techniques designed specially for panel data are applied to test for unit roots and causality. The results indicate a virtuous procedure of development for China. The growth of China’s imports causes growth in inward FDI from a home country/region, which in turn causes the growth of exports from China to the home country/region. The growth of exports causes the growth of imports. This virtuous procedure is the result of China’s policy of opening to the outside world. China has been encouraging export-oriented FDI and reducing trade barriers. Such policy instruments should be further encouraged in order to enhance economic growth. In the second study, an extended gravity model is constructed to identify the main causes of recent trade growth in OECD countries. The specific features include (a) the explicit introduction of R&D and FDI as two important explanatory variables into an augmented gravity equation; (b) the adoption of a panel data approach, and (c) the careful treatment of endogeneity. The main findings are that the levels and similarities of market size, domestic R&D stock and inward FDI stock are positively related to the volume of bilateral trade, while the geographical distance, exchange rate and relative factor endowments, has a negative impact. These findings lend support to new trade, FDI and economic growth theories. The third study evaluates the impact of openness on growth in different country groups. This research distinguishes itself from many existing studies in three aspects: first, both trade and FDI are included in the measurement of openness. Second, countries are divided' into three groups according to their development stages to compare the roles of FDI and trade in different groups. Third, the possible problems of endogeneity and multicollinearity of FDI and trade are carefully dealt with in a panel data setting. The main findings are that FDI and trade are both beneficial to a country's development. However, trade has positive effects on growth in all country groups but FDI has positive effects on growth only in the country groups which have had moderate development. The findings suggest FDI and trade may affect growth under different conditions.

Effect of pulsed current on the electrodeposition of chromium and copper

This research was concerned with the effects of pulsed current on the electrodeposition of chromium and copper. In the case of the latter metal, a novel application has been studied and a theory proposed for the ability to improve throwing power by the joint use of organic additives and pulsed reverse current. During the course of the research, several improvements were made to the pulse plating unit.Chromium. A study was made of the effect of square wave pulsed current on various physical properties of deposits from three hard chromium plating electrolytes. The effect of varying frequency at a duty cycle of 50% on the mean bulk internal stress, visual appearance, hardness, crack characteristics and surface topography of the electrodeposits was determined. X-ray diffraction techniques were used to study the phases present in the deposits. The effect of varying frequency on the cathodic efficiencies of the electrolytes was also determined. It was found that pulsed current reduced the internal stress of deposits from the sulphate catalysed electrolyte. It also reduced or eliminated cracking of deposits and reduced deposit brightness. Under certain conditions, pulsed current was found to induce the co-deposition of hydrides of chromium. Deposit hardness was found to be reduced by the use of pulsed current. Cathodic efficiencies of the high efficiency electrolytes were reduced by use of pulsed current although this effect was minimised at high frequencies. The sulphate catalysed electrolyte showed an increase in efficiency over the frequency range where hydrides were co-deposited.Copper. The polarisation behaviour of acid copper solutions containing polyethers, sulphopropyl sulphides and chloride ions was studied using both direct and pulse reverse current. The effect of these additives on the rest potentials of copper deposits immersed in the electrolyte was also studied. Hole Throwing Power on printed circuit boards was determined using a specially designed test cell. The effect of pulsed reverse current on the hole throwing power of commercially produced printed circuit boards was also studied. Polyethers were found to have an inhibiting effect on the deposition of copper whereas the sulphopropyl sulphides produced a stimulating (i.e. depolarising) effect. Studies of rest potentials made when both additives were present indicated that the sulphopropyl sulphide was preferentially adsorbed. The use of pulsed reverse current in solutions containing both polyether and sulphopropyl sulphide was found to cause desorption of the sulphopropyl sulphide at the cathode surface. Thus, at higher current densities, the inhibiting effect of the polyether produced an increase in the cathodic polarisation potential. At lower current densities, the depolarisation effect of the sulphopropyl sulphide could still occur. On printed circuit boards, this effect was found to produce an increase in the `hole throwing power' due to depolarisation of the holes relative to the surface of the boards. Typically, using direct current, hole/surface thickness ratios of 40% were obtained when plating 0.6 mm holes in a 3.2 mm thick board at a current density of 3 A/dm2 whereas using pulsed reverse current, ratios of 80% could be obtained at an equivalent rate of deposition. This was observed both in laboratory tests and on commercially plated boards.

The compressive creep and load relaxation properties of a series of high aluminium zinc-based alloys

A new family of commercial zinc alloys designated as ZA8, ZA12, and ZA27 and high damping capacity alloys including Cosmal and Supercosmal and aluminium alloy LM25 were investigated for compressive creep and load relaxation behaviour under a series of temperatures and stresses. A compressive creep machine was designed to test the sand cast hollow cylindrical test specimens of these alloys. For each compressive creep experiment the variation of creep strain was presented in the form of graphs plotted as percentage of creep strain () versus time in seconds (s). In all cases, the curves showed the same general form of the creep curve, i.e. a primary creep stage, followed by a linear steady-state region (secondary creep). In general, it was observed that alloy ZA8 had the least primary creep among the commercial zinc-based alloys and ZA27 the greatest. The extent of primary creep increased with aluminium content to that of ZA27 then declined to Supercosmal. The overall creep strength of ZA27 was generally less than ZA8 and ZA12 but it showed better creep strength than ZA8 and ZA12 at high temperature and high stress. In high damping capacity alloys, Supercosmal had less primary creep and longer secondary creep regions and also had the lowest minimum creep rate among all the tested alloys. LM25 exhibited almost no creep at maximum temperature and stress used in this research work. Total creep elongation was shown to be well correlated using an empirical equation. Stress exponent and activation energies were calculated and found to be consistent with the creep mechanism of dislocation climb. The primary α and β phases in the as-cast structures decomposed to lamellar phases on cooling, with some particulates at dendrite edges and grain boundaries. Further breakdown into particulate bodies occurred during creep testing, and zinc bands developed at the highest test temperature of 160°C. The results of load relaxation testing showed that initially load loss proceeded rapidly and then deminished gradually with time. Load loss increased with temperature and almost all the curves approximated to a logarithmic decay of preload with time. ZA alloys exhibited almost the same load loss at lower temperature, but at 120°C ZA27 improved its relative performance with the passage of time. High damping capacity alloys and LM25 had much better resistance to load loss than ZA alloys and LM25 was found to be the best against load loss among these alloys. A preliminary equation was derived to correlate the retained load with time and temperature.

Recent and Miocene carbonate sediments from Indonesia. Available in 2 volumes.

Mapping and sediment sampling in reefs of the Pulau Seribu group (southwest Java Sea) shows the existence of ten physiographic zones and subzones represented by seven lithofacies. Reefs in the northern part of the archipelago are smaller, more closely spaced and morphologically sim pler than those in the south. This pattern is attributed to differences in subsidence rate. A th reedimensional model is proposed for the evo lution of these reefs but borehole data are requi red to test this model. Miocene limestones are described in detail from hydrocarbon reservoirs in the Batu Raja Formation of the same area. Brief comparisons a re made with surface outcrops of approximately coeval carbonate developments. The lithofacies developed within these limestones reflect variations in hydrodynam ic regime and basement topography . Ele\le.n diagenetic processes affected the Batu Raja limestones and the dist ribution of these is primarily related to sealevel fluctuations. Early diagenesis was marine and characterised by micritisation and preCipitation of fibrous and bladed cements. Dolomitisat ion occurred in the mixed- water zone and its variable intensity is attributed to the configuration of the carbonate body relative to this zone. Subsequently the limestones were subjected to freshwater phreatic zone diagenesis resulting in dissolution and cementation, and a t a late stage underwent burial compaction. Secondary porosity, which \ar9e1.y determines the suitability of these limestones as hydrocarbon reserVOirs, is a function of the variable intensity of dissolution and cementation, burial compaction, dolomitisation and possibly micrite neomorphism. The sedimentary processes that generated the Batu Raja buildups are inferred f rom comparisons with the Pulau Seribu and other Recent analogues. The contrasting pinnacle form of the Pulau Seribu patch reefs compared with the low relief of the Batu Raja buUdups results from differences in the initial substrate topography and subsequent subsidence rate