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Article
Publication date: 9 October 2017

Marko Korhonen, Mikko Puhakka and Matti Viren

The purpose of this paper is to investigate the determinants of aggregate suicides in 15 OECD countries during 1960-2010 using an economic model where changes in the…

Abstract

Purpose

The purpose of this paper is to investigate the determinants of aggregate suicides in 15 OECD countries during 1960-2010 using an economic model where changes in the welfare of consumers play the critical role for determining the number of suicides.

Design/methodology/approach

The hardship index based on economic theory is developed. In estimating the model, the authors apply the Pesaran et al. (2001) approach that allows the simultaneous estimation of the long-run and short-run parameters. To make sure that the authors’ findings are not specific to their method, the authors also use the generalized method of moments estimation in the panel set-up.

Findings

The authors found a relatively strong positive relationship between macroeconomic conditions, especially changes in aggregate consumption, and suicides. The relationship appears to be robust also in terms of the various control variables cited in the literature. The hardship index which is based on the habit persistence model of consumption predicts and explains the long-term behavior of suicides in most of the countries. Thus, the hardship index is a better economic explanatory variable than the unemployment rate or other proxies describing economic conditions.

Originality/value

Marrying the economic theory and econometric methods produces a reasonable empirical model to explain the connection between aggregate economic conditions and suicides.

Details

International Journal of Social Economics, vol. 44 no. 10
Type: Research Article
ISSN: 0306-8293

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Book part
Publication date: 29 January 2021

Michael K. Fung and Arnold C. S. Cheng

Using a sample of developed and developing nations (including China and Hong Kong), this study examines the financial market and housing wealth effects on consumption

Abstract

Using a sample of developed and developing nations (including China and Hong Kong), this study examines the financial market and housing wealth effects on consumption. Housing performs the dual functions as both a commodity providing a flow of housing services and an investment providing a flow of capital income. With an empirical framework based on the permanent income hypothesis, this study's findings suggest that a rise in housing price has both a positive wealth effect and a negative price effect on consumption. While the positive wealth effect is caused by an increase in capital income from housing investment, the negative price effect is caused by an increase in the cost of consuming housing services. Moreover, the sensitivity of consumption to unanticipated changes in housing price is related to the level of financial and institutional development.

Details

Modeling Economic Growth in Contemporary Hong Kong
Type: Book
ISBN: 978-1-83909-937-3

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Article
Publication date: 22 May 2007

Gianni Betti, Neil Dourmashkin, Mariacristina Rossi and Ya Ping Yin

This paper seeks to measure and characterise the extent of consumer over‐indebtedness among the European Union (EU) member states.

Abstract

Purpose

This paper seeks to measure and characterise the extent of consumer over‐indebtedness among the European Union (EU) member states.

Design/methodology/approach

The study evaluates alternative measures of over‐indebtedness on the basis of the permanent‐income/life‐cycle theories of consumption behaviour and adopts a subjective approach in identifying over‐indebted households on the basis of European household survey data. It then investigates the main characteristics of over‐indebted households.

Findings

The empirical results reveal that over‐indebtedness was a significant problem across EU member states in the mid‐1990s. Moreover, an inverse relationship emerged between the extent of the over‐indebtedness problem and the extent of consumer borrowing across EU countries.

Research limitations/implications

Anecdotal evidence seemed to suggest that some main factors behind over‐indebtedness could be “market failure” on the credit market, the existence of liquidity constraints and lack of access to formal credit markets. However, a comprehensive and rigorous investigation of the extent and determinants of over‐indebtedness can only be achieved through analysis of more extended household data sets, particularly panel data.

Practical implications

The EU credit markets exhibited certain symptoms of “market failure”, on the one hand, and there was also need for further financial liberalisation in the Southern European countries, on the other hand.

Originality/value

The paper provides a first systematic evaluation of existing measures of consumer over‐indebtedness as well as the first EU‐wide empirical investigation of the problem. It should provide valuable information to the credit industry as well as financial regulatory bodies.

Details

Journal of Economic Studies, vol. 34 no. 2
Type: Research Article
ISSN: 0144-3585

Keywords

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Article
Publication date: 12 November 2018

Salman Ahmed Shaikh, Mohd Adib Ismail, Abdul Ghafar Ismail, Shahida Shahimi and Muhammad Hakimi Mohd Shafiai

This study aims to examine the consumption behaviour in Organization of Islamic Cooperation countries.

Abstract

Purpose

This study aims to examine the consumption behaviour in Organization of Islamic Cooperation countries.

Design/methodology/approach

Using time series and panel data, this study estimates rational expectations permanent income hypothesis model and the intertemporal elasticity of substitution, and examines the response in consumption to expected and unexpected changes in income.

Findings

The evidence supports the phenomenon of loss aversion. The response of consumption to unexpected income changes is statistically significant in only one-third of the countries in the sample. Conversely, the response of consumption to expected income changes is statistically as well as economically significant in one-fourth of the countries in the sample. The intertemporal elasticity of substitution is also statistically insignificant in majority of OIC countries in the sample.

Practical implications

The evidence in support of loss aversion in preferences could help in explaining the low penetration of equity-based risk sharing instruments in Islamic finance.

Social implications

The excess sensitivity of consumption to income suggests that redistribution efforts to enhance incomes of poor households could help in enhancing their consumption levels.

Originality/value

The study takes a comprehensive sample across time and space for OIC countries as compared to previous studies and also adjusts the budget constraint for Zakat.

Details

International Journal of Islamic and Middle Eastern Finance and Management, vol. 11 no. 4
Type: Research Article
ISSN: 1753-8394

Keywords

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Article
Publication date: 26 September 2008

Shengliang Deng and Xiaotong Jin

Until now, traditional western consumption theories have not been able to adequately explain the consumption behavior of Chinese residents in the economic transitional…

Abstract

Purpose

Until now, traditional western consumption theories have not been able to adequately explain the consumption behavior of Chinese residents in the economic transitional period. Based on annual data from 1986 to 2004, the purpose of this paper is to examine the excess sensitivity of consumption through a variable parameter model.

Design/methodology/approach

A regression model was used to analyse annual consumption data from 1986 to 2004 in China.

Findings

The analysis demonstrates excess sensitivity characteristic in Chinese residents' consumption in the economic transitional period.

Research limitations/implications

The paper concludes that in order to make the demand stimulation policy in China more effective, it is necessary to take a series of measures to correct the excess sensitivity of consumption, so as to establish a healthy cycle of national economy. The paper has only explained excess sensitivity of Chinese residents' consumption from the point of view of economics. While consumption is an economic problem as well as a social problem, those factors beyond economics should not be excluded from the analysis.

Originality/value

This paper differs from former studies in that previous scholars failed to take into consideration the special economic characteristics in China's transitional economy. The variable parameter model this paper employed takes full consideration of such unique factors as economic expectations and systems changes during the transitional period so as to better explain Chinese people's consumption behavior and provide a new perspective to make government policies stimulate domestic demand more effectively.

Details

International Journal of Emerging Markets, vol. 3 no. 4
Type: Research Article
ISSN: 1746-8809

Keywords

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Article
Publication date: 4 March 2019

Shafiu Ibrahim Abdullahi

This paper explores the role of Zakah in social cause marketing. Academic literature on Islamic economics, finance and management mostly deals with the links that exists…

Abstract

Purpose

This paper explores the role of Zakah in social cause marketing. Academic literature on Islamic economics, finance and management mostly deals with the links that exists between Zakah and consumption, neglecting important and strategic links with social cause marketing. This paper emanated from need to outline social cause and the charitable role of Zakah in promoting Halal businesses, poverty alleviation and sustainable development. Most works in the field of Zakah did not foresee the role of marketing. This is a misjudgement, as this work showed that Zakah yields large and measurable social gains to help the society and a firm.

Design/methodology/approach

Secondary sources were used in writing this paper. Available literature in the form of journals, books, manuals and reports was referred to. As a conceptual work, the paper does not test hypothesis or pretends to provide empirical evidences. It uses mathematical economics in arriving at some of the conclusions. Findings were derived through deductions and critical discourses, not through crunching of primary data.

Findings

The paper shows how Zakah, Halal consumption and corporate social responsibility are connected and highlights the role of Zakah as a social marketing tool. It shows how Zakah affects consumption through marginal propensity of Zakah recipients who spend Zakah money on basic needs.

Research limitations/implications

The paper looks at the broad aspects of Zakah and social marketing. How to make Zakah a pillar of Islamic firms’ social cause programs shall be the focus of future academic works in this area.

Originality/value

The paper is unique in drawing attention of Islamic firms to the effectiveness of Zakah in building a corporate image. It draws the attention of firms, activists, academics and governments to functions of Zakah that have not been studied in depth.

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Article
Publication date: 5 July 2011

Xiaotong Jin, Shengliang Deng and Ilan Alon

The paper aims to examine the consumption behavior of Chinese residents during economic transition. It explores whether Western theories of consumption are applicable to…

Abstract

Purpose

The paper aims to examine the consumption behavior of Chinese residents during economic transition. It explores whether Western theories of consumption are applicable to the Chinese situation, and then tests the hypothesis based on Chinese traditional culture and dynamic nature of system change.

Design/methodology/approach

The paper opted for an empirical‐based approach. A regression model was used to analyze annual consumption data from 1986 to 2008 in China.

Findings

The paper provides empirical insights and suggests that under the influence of Chinese traditional culture and dynamic change of the Chinese economic system, Chinese urban residents exhibit a special consumption pattern of an intermittent and cyclical nature.

Research limitations/implications

The paper concludes that in order to make the consumption stimulation policy in China more effective, it is necessary to establish a series of measures such as establishing a sound social welfare system as well as narrowing the gap between the rich and the poor, which will substantially increase the buying power of the less‐privileged groups and thus will increase the overall spending in the society. Although the econometric model used in this paper is adequate, a different approach like time series econometrics may give us additional insights. Researchers are encouraged to test the hypothesis further by employing other methodologies. Second, due to the lack of its own theories in the emerging market, this study remains exploratory.

Originality/value

This paper fulfils an identified need to study the special consumption behavior of Chinese urban residents during the economic transition.

Details

International Journal of Emerging Markets, vol. 6 no. 3
Type: Research Article
ISSN: 1746-8809

Keywords

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Article
Publication date: 3 May 2016

Sabien Dobbelaere, Rodolfo Lauterbach and Jacques Mairesse

Institutions, social norms and the nature of industrial relations vary greatly between Latin American and Western European countries. Such institutional and organizational…

Abstract

Purpose

Institutions, social norms and the nature of industrial relations vary greatly between Latin American and Western European countries. Such institutional and organizational differences might shape firms’ operational environment in general and the type of competition in product and labor markets in particular. The purpose of this paper is to identify and quantify industry differences in product and labor market imperfections in Chile and France.

Design/methodology/approach

The authors rely on two extensions of Hall’s econometric framework for estimating price-cost margins by nesting three labor market settings (LMS) (perfect competition (PC) or right-to-manage bargaining, efficient bargaining (EB) and monopsony). Using an unbalanced panel of 1,737 firms over the period 1996-2003 in Chile and 14,270 firms over the period 1994-2001 in France, the authors first classify 20 comparable manufacturing industries in six distinct regimes that differ in the type of competition prevailing in product and labor markets. The authors then investigate industry differences in the estimated product and labor market imperfection parameters.

Findings

Consistent with differences in institutions and in the industrial relations system in the two countries, the authors find regime differences across the two countries and cross-country differences in the levels of product and labor market imperfection parameters within regimes.

Originality/value

This study is the first to compare the type and the degree of industry-level product and labor market imperfections inferred from consistent estimation of firm-level production functions in a Latin American and a Western European country. Using firm-level output price indices, the microeconomic production function estimates for Chile are not subject to the omitted output price bias, as is often a major drawback in microeconometric studies of firm behavior.

Details

International Journal of Manpower, vol. 37 no. 2
Type: Research Article
ISSN: 0143-7720

Keywords

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Article
Publication date: 1 March 1991

Roger Perman

An overview of the cointegration approach to econometricspecification and estimation is provided. A non‐technical approach isadopted, and is intended to serve as an entry…

Abstract

An overview of the cointegration approach to econometric specification and estimation is provided. A non‐technical approach is adopted, and is intended to serve as an entry into this important new literature for the reader with no background knowledge of the subject but with some limited knowledge of econometrics. Particular emphases are given to the rationale for using cointegration techniques in the estimation of economic relationships, to providing intuitive explanations of the concepts and techniques, and to demonstrating their applications in practice. Reference is made throughout to other articles which explain particular methods or recent developments more formally and fully than is possible here. Finally, a simple application of cointegration techniques to the estimation of the consumption function is provided.

Details

Journal of Economic Studies, vol. 18 no. 3
Type: Research Article
ISSN: 0144-3585

Keywords

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Article
Publication date: 1 September 1963

It is complained of modern youth that they show no respect for people, places or things, but from a dismal disaster of recent weeks it is demonstrated all too clearly that…

Abstract

It is complained of modern youth that they show no respect for people, places or things, but from a dismal disaster of recent weeks it is demonstrated all too clearly that food‐borne disease organisms—Salmonellæ, Shigellæ, Escheriæ, the entro‐viruses and all the rest—have no respect for anyone either. You would at least expect them to leave alone, or only attack in a playful sort of way, one who having reached the afternoon of life has devoted many years to studying and publicising food and nutrition, food‐borne and dietary disease, but, not a bit of it! One of these ungrateful varmints, in all probability one of the Shigellas, sneaked into the editorial alimentary canal, kicked up no end of a commotion there, thoroughly insulted the liver, which thereupon withdrew into sulky silence and refused to function, smote us everywhere with barbs of pain and at first, something quite unpardonable, refused to be quelled by orthodox doses of the appropriate sulpha‐drugs. While the war was on, we, like so many others would do, asked “why should this happen to us?” The answer is, of course, they have no respect for persons.

Details

British Food Journal, vol. 65 no. 9
Type: Research Article
ISSN: 0007-070X

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