Applied Economics Letters

Cerra, Valerie; Saxena, Sweta C.

doi: 10.1080/13504850601018031pmid: N/A

This article combines common factor extraction techniques with permanent and temporary regime switching to analyse Chile's business cycle fluctuations. We find asymmetries across business cycle episodes as well as within the cycle.

Schaub, Mark

doi: 10.1080/13504850601018064pmid: N/A

This study notes that the light sentence for insider trading that resulted in a nearly 37% gain for Martha Stewart Living Omnimedia, Inc. also may have been responsible for a small but significant average loss for industry rivals on the sentencing date. The sentence that was ‘good’ news for Martha was also ‘bad’ news for her competitors on the sentencing date.

Shields, Gail; Shields, Michael P.

doi: 10.1080/13504850601007109pmid: N/A

This article examines why hours worked in the United States have risen for the last thirty years. This increase has been contrasted by Prescott and Blanchard to the European experience of falling hours worked. Four basic explanations of this divergence are combined in a reduced form model of hours worked in the United States from 1965 to 2001. The explanation that seems to fit the data best is that rising health care costs in the United States is a key explanation. Other explanations for the increase in United States average hours worked per week include a decline in marginal tax rates, a rise in income inequality coupled with a decline in real wage rates, and productivity growth. A reduced form model is estimated using four explanatory variables representing each of these four themes.

Nishiyama, Yasuo

doi: 10.1080/13504850600993713pmid: N/A

The article finds evidence that the converging trend of euro-zone countries' retail mortgage rates, observed before and shortly after the introduction of the euro, is dictated by the German mortgage rate, hence supporting the German leadership role.

Paul, Saumik; Mitra, Ronita

doi: 10.1080/13504850601007117pmid: N/A

Since 1993 the Federation of International Football Association's (FIFA) monthly world ranking system for senior national football teams has become a reliable source to judge a team's potentiality in football. In the past four FIFA worldcup football tournaments from 1994 to 2006, the top seeded team never won the FIFA worldcup except in 1994 when Brazil won as the number one team. This article examines the strength of this element of uncertainty in FIFA worldcup using two empirical models. We find empirical evidence of the fact that in spite of the number of cases of surprise upsets from the lower ranked teams or poor performance by the top seeded teams; overall the results are strongly in favour of the higher ranked teams.

Ho, Kong Weng; Tan, Randy

doi: 10.1080/13504850500461399pmid: N/A

We examine empirically the role of human capital, together with global and domestic technologies, in the evolution of unemployment in Singapore. Our results show a threshold level of human capital, below (above) which increases (decreases) in human capital will reduce (raise) unemployment. This nonmonotonic relationship is caused by a greater substitution from labour toward technology feasible at higher levels of human capital.

Kim, Minchoul; Kim, Minho; McNiel, Ronald D.

doi: 10.1080/13504850601018080pmid: N/A

The purpose of this article is to identify the success factors of corporate restructuring by studying the firms that have survived from the financial distress in South Korea. The logit analysis is used with the two qualitative variables of success and failure. Selected independent variables are firm risk, free asset, audit opinion, liquidity, firm size and period of existence. The results show that audit opinion, risk of the firm and firm size are the important variables in predicting the survival prospect of financially distressed firms. The percentage of correct prediction is 81.4% for the estimation sample.

Kim, Young-Yong

doi: 10.1080/13504850600993721pmid: N/A

It is profitable to accept a bill as long as dishonouring probability of the bill is less than the ratio of operating income to sales, which is supported by empirical observations. Also accepting bills tends to establish high quality customer relationships, thereby increasing the long-run profits and decreasing their variability.

Drakos, Konstantinos; Goulas, Eleftherios

doi: 10.1080/13504850601007083pmid: N/A

We investigate the relative importance of sector and country factors in explaining the variation of leasing penetration rates across industries in Europe. According to our results, country effects represent the dominant driving factor for leasing when compared to sector effects. An explanation might be that the country factors overshadow the corresponding sector ones for they capture the depth and development of the leasing sector.

Westerhoff, Frank H.

doi: 10.1080/13504850600993705pmid: N/A

We seek to demonstrate that consumer sentiment may create fluctuations in economic activity. Our nonlinear discrete-time model possesses, for instance, a Neimark–Sacker bifurcation, after which a stable steady state is replaced by (quasi-)periodic motion. Countercyclical interventions to stabilize the economy may even produce complex (chaotic) business cycles.