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The purpose of this paper is to investigate four possible asymmetries in US aggregate consumption and its major components (durables, non-durables, and services) for the period 1990-2013. Understanding the asymmetric behavior of the components is important since the impact of monetary policy on separate consumer spending categories may differ substantially.

The authors first employ stationarity and cointegration tests to specify and estimate the long-run equilibrium relationship between consumer spending and such variables as disposable income, consumer sentiment, and the expected real interest rate. The authors then specify a structural error-correction model for each spending category to simultaneously investigate such possible asymmetries due to the ratchet effect, psychological negativity bias, interest rate effect, and varying degree of adjustment in eliminating disequilibrium defined as the gap between actual and desired spending.

First, consumption and its major components all display asymmetric behavior consistent with psychological negativity bias. Second, consumer spending on durable goods also displays asymmetries consistent with both the ratchet effect and the interest rate effect. Third, non-durables respond asymmetrically to disequilibrium; consumers adjust (increase) spending on non-durables only when actual spending is below desired spending on non-durable goods. Fourth, services also respond asymmetrically to disequilibrium; consumers adjust (reduce) spending on services only when actual spending is above desired spending on services.

This study provides new insight on the asymmetric behavior of consumer spending. The authors believe that the findings should help with macroeconomic policymaking when such indicators as income, consumer sentiment, and expected real interest rates display significant variations.

This paper examines the implications of standard barter models of market equilibrium for financial security returns in New Zealand. The key question addressed is: does the ‘equity premium puzzle’ of Mehra and Prescott (1985) found in the U.S. also hold in ?ew Zealand? To examine the existence of the equity premium puzzle, quarterly financial security returns and consumption data are examined from 1965 to 1997 to calibrate parameters in the Consumption Based Asset Pricing Model. Unlike much of the existing international evidence, this paper corrects for durable goods consumption following the assumptions of the model that all consumption be consumed in a given period. Numerical analyses indicate that the class of models examined are unable to generate equity premia consistent with historical estimates of the equity premium in New Zealand. Due to small sample variability however, while this discrepancy is material in size, the result is not statistically significant.

This paper seeks to reconsider the Euler equation of the Consumption Capital Asset Pricing Model (CCAPM), to derive a regression‐based model to test it, and to present evidence that the model is consistent with reasonable values for the coefficient of relative risk aversion (CRRA). This runs contrary to the findings of the literature on the equity premium puzzle, but is in agreement with the literature that estimates the CRRA for the purpose of computing the social discount rate, and is in line with the research on labor supply. Tests based on General Method of Moments (GMM) for the same sample produce results that are extremely disparate and unstable. The paper aims to check and find support for the robustness of the regression‐based tests. Habit formation models are also to be evaluated with regression‐based and GMM tests. However, the validity of the regression‐based models depends critically on their functional forms.

The paper presents empirical evidence that the conventional use of GMM fails because of four pathological features of GMM that are referred to under the general caption of “weak identification”. In addition to GMM, the paper employs linear regression analysis to test the CCAPM, and it is found that the regression residuals follow well‐behaved distributional properties, making valid all statistical inferences, while GMM estimates are highly unstable.

Four unexpected findings are reported. The first is that the regression‐based models are consistent with reasonable values for the CRRA, i.e. estimates that are below 4. The second is that the regression‐based tests are robust, while the GMM‐based tests are not. The third is that regression‐based tests with habit formation depend crucially on the specification of the model. The fourth is that there is evidence that market stock returns are sensitive to both consumption and dividends. The author calls the latter “extra sensitivity of market stock returns”, and it is described as a new puzzle.

The regression‐based models of the CCAPM Euler equation are novel. The comparison between GMM and regression‐based models for the same sample is original. The regression‐based models with habit formation are new. The equity premium puzzle disappears because the estimates of the CRRA are reasonable. But another puzzle is documented, which is the “extra sensitivity of market stock returns” to consumption and dividends together.

The purpose of this paper is to investigate the impact of a consumer confidence shock on GDP and different types of consumer spending during a slack state as well as a non-slack state of an economy.

The authors use the US quarterly data from 1960Q1 to 2014Q4 and apply Jorda’s (2005) local projection method to compute the impulse responses of macroeconomic variables to a consumer confidence shock. The local projection method allows us to include non-linearities in the response function.

In general, the response of output, following a consumer confidence shock, is similar in slack and non-slack states and indicate that an unfavorable confidence shock is contractionary. However, the intensity and duration of impact of a confidence shock on different components of spending are state dependent. Overall, a negative confidence shock appears to have a stronger impact on non-slack time than on a slack time.

Policy makers should be careful about undertaking a policy action that may affect consumer confidence adversely, particularly during an economic good time. An adverse confidence shock can trigger a downfall in a well-functioning economy and the dampening effect may last for several quarters before the economy rebounds.

US economy is subject to fluctuations; however, the literature on the impact of confidence shock in different economic states is limited. The incremental contribution of this paper is that it investigates how the consumers respond to the confidence shock in a state-dependent model. Furthermore, the authors use a more robust and alternative estimation method that tackles any non-linear problems.

The purpose of this paper is to test whether households with members that experience job loss shocks are able to protect their previous level of consumption. The paper also tests whether consumption protection is affected when spells persist through time.

The paper estimates an intertemporal consumption model, where households try to smooth their marginal utility over time. For that purpose it analyses Spanish household budget surveys that span a long period, 1999-2012, including the Great Recession. Unlike most consumption datasets, this microdata is designed as a panel and provides detailed information for all consumption categories as well as household members’ labour status.

The paper finds that consumption smoothing is dependent on the household member facing the unemployment transition. In particular, only main breadwinner’s unemployment transitions affects consumption smoothing. It also shows that the consumption drop persists beyond the period of the job loss for ongoing spells, although it follows a decreasing pattern. Finally, the estimation results are stable over the business cycle.

The results suggest that Spanish households are not capable of fully insuring against main breadwinner’s unemployment shocks. Further, the results show that this effect remains up to two years for ongoing unemployment spells. Thus these results highlight a welfare loss by Spanish households with unemployed members.

The paper extends the usual analysis of job loss shocks by the main breadwinner to include the cases of both the spouse and the rest of household members, who tend to account for most unemployment. Further, it tests for unemployment persistence. Finally, it checks the sensitivity of the results to the business cycle, including the Great Recession.

Globalization has brought apparent transformations to the UAE market. Shift in market trends due to a growing multicultural population induces marketers to update their marketing strategies. Focusing on the purchase behavior and level of satisfaction of consumers coming from different regions, the purpose of this paper is to examine the influence of multi‐cultural consumers in the buying behaviour in the Abu Dhabi market for durable and non‐durable consumer products.

The sampling frame to examine the impact of heterogeneous culture in a geocentric market comprised 300 consumers belonging to different nationalities working in the UAE. Satisfaction Index, Kendall's Coefficient of Concordance and Kruskal–Wallis test were used to test hypotheses constructed from literature.

The three hypotheses formulated to test inter‐cultural differences revealed the influence of multi‐culture on consumers' buying behaviour. This paper recommends that by optimizing the utility of well‐advanced digital media in the Emirates, marketers can customize strategies by which to penetrate culturally segmented niches.

Global marketing is emerging in the Arab markets, assuming that global culture will bring about a paradigm shift from homogenous to heterogeneous buying habits. Exploring the influence of multicultural consumerism, the study illustrates the divergent demands of Abu Dhabi consumers.

Spotlights the principal emphasis of this study as descriptions of the present state and indicators of change in US channel structure. Follows this by speculating briefly about future trends in this structure and its relevance for UK business. Looks ahead to future developments and makes comparisons with the UK in regard to recent developments in US distribution patterns – particularly changing power relationships between institutions. States that though only UK sources have been available for use here, the trends in the US economy should be able to be described with sufficient detail. Concludes that there are lessons for the UK market in dealing with the USA and these should be used.

Argues that successful exporting to East Asian markets requires a good understanding of local conditions. One important issue is how consumers decide on products and how they view products from various countries. Hong Kong is representative of newly affluent markets which are growing throughout East Asia. In the beer market, Hong Kong consumers choose brands based on quality characteristics, especially taste. Other important aspects include the beer′s image and the country‐of‐origin. Brand loyalty is strong. Price is relatively unimportant to most consumers. Many beer drinkers believe that German beer is the best, though they may not always buy beer from Germany.

The purpose of this paper is to empirically analyze volatility properties of the house price returns of Turkey and Istanbul, Ankara and Izmir provinces over the period of July 2007-June 2014.

The paper uses conditional variance models, namely, ARCH, GARCH and E-GARCH. As the supportive approach for the discussions, we also use correlation analysis and qualitative inputs.

Empirical findings suggest several points. First, city/country-level house price return volatility series display volatility clustering pattern and therefore volatilities in house price returns are time varying. Second, it seems that there were high (excess) and stable volatility periods during observation term. Third, a significant economic event may change country/city-level volatilities. In this context, the biggest and relatively persistent shock was the lagged negative shocks of global financial crisis. More importantly, short-lived political/economic shocks have not significant impacts on house price return volatilities in Turkey, Istanbul, Ankara and Izmir. Fourth, however, house price return volatilities differ across geographic areas, volatility series may show some co-movement pattern. Fifth, volatility comparison across cities reveal that Izmir shows more excess volatility cases, Ankara recorded the highest volatility point and Istanbul and national series show lower and insignificant volatilities.

The study uses maximum available data and focuses on some house price return volatility patterns. The first implication of the findings is that micro/macro dimensions of house price return volatilities should be carefully analyzed to forecast upside/downside risks of house price returns. Second, defined volatility clustering pattern implies that rate of return of housing investment may show specific patterns in some periods and volatile periods may result in some large losses in the returns. Third, model results generally suggest that however data constraint is a major problem, market participants should analyze regional idiosyncrasies during their decision-making in housing portfolio management. Fourth, because house prices are not sensitive to relatively less structural shocks, housing may represent long-term investment instrument if it provides satisfactory hedging from inflation.

The evidences and implications would be useful for housing market participants aiming to manage/use externalities of housing price movements. From a practical contribution perspective, the study provides a tool that will allow measuring first time of the return volatility patterns of house prices in Turkey and her three biggest provinces. Local level analysis for Istanbul, Ankara and Izmir provinces, as the globally fastest growing cities, would be found specifically interesting by international researchers and practitioner.

The present paper explores how advertisers use consumer culture positioning (CCP) strategies in advertising across countries and product categories.

The study employs a content analysis approach to investigate usage of CCP strategies and symbols across different CCP strategies, countries and product categories. The authors focussed on country of origin (COO) cues as symbols of CCP. The authors collected printed advertisements from countries at different levels of economic development and communication orientation for the content analysis, namely, Austria (n = 182), Hungary (n = 199) and Turkey (n = 120) and products with high- vs low-involvement levels.

Findings of this study indicated that global consumer culture positioning (GCCP) and local consumer culture positioning (LCCP) advertisements relied more on implicit symbols, while foreign consumer culture positioning (FCCP) advertisements predominantly employed explicit ones. Types of symbols and their utilisation varied across countries and product categories, with language, tag lines/logos and brand names being key components across different advertisements.

The results document the practices of CCP-based advertising, offering important insights on whether and how symbolism can be effectively used for communicating different CCPs across markets.

Little is known in terms of how specific symbols are used to communicate consumers’ culture. In this study, the authors analysed the content of 501 real-print advertisements across multiple countries and product categories. This study contributes to the theory and practice by revealing how consumers’ culture manifests through diverse COO symbols in advertising imagery and by facilitating the application of such manifestations across market contexts.