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The aim of this study is to examine whether China’s exchange rate follows an equilibrium process and consequently to answer the question of whether or not China’s international competitiveness fluctuates in consistency with equilibrium.

The theoretical background of the paper relies on the Purchasing Power Parity (PPP) hypothesis, while the econometric methodology is mainly based on a nonlinear two-regime Threshold Autoregressive (TAR) unit root test.

The main finding is that China’s price competitiveness was not constantly following a disequilibrium process. The two-regime threshold model shows that PPP equilibrium was confirmed in periods of relatively high – compared to the estimated threshold – rate of real yuan appreciation. Moreover, it is implied that the fixed exchange rate regime cannot ensure external balance since it can neither establish equilibrium in the foreign exchange market, nor confirm that China’s international competitiveness adjustment follows an equilibrium process.

The results do not imply that China acts as a currency manipulator. However, a main policy implication of the paper is that China should continue appreciating the yuan to establish external balance.

This paper is the first which accounts for a nonlinear two-regime process toward a threshold, which is defined to be the rate of change in China’s international competitiveness. Consequently, the paper draws attention to the role of China’s international competiveness in accepting the PPP hypothesis.

Currently, there is a conflict in developing countries between the requirements for the self-development of forestry and the insufficient investment in the forestry sector, and the forest ticket system is an innovative forestry management method to solve this contradiction. In the research on the forest ticket system, the study of its price formation mechanism is relatively important. The key issues of the forest ticket system are how to form the forest ticket price and whether the forest ticket pricing methods are reasonable. Solving these problems is the purpose of this study.

This study will use three methods, namely the forest ecosystem service value evaluation index method, the ecosystem service value based on per unit area evaluation method and the contingent valuation method, to study the forest ticket price formation mechanism, filling the gap in the current research on forest ticket pricing methods. It will analyze how these three pricing methods specifically price the forest ticket and evaluate whether these pricing methods are reasonable. This study will then summarize and comprehensively study the forest ticket price formation mechanism and provide policy recommendations for decision-making departments.

The contingent valuation method and the forest ecosystem service value evaluation index method should be mainly used and given priority in the forest ticket pricing process. When the forest ticket is mainly issued for local residents' willingness to compensate for the forestry ecological value, the contingent valuation method should be mainly considered; when the forest ticket is mainly issued for compensating for the ecological value of local used forest land, the forest ecosystem service value evaluation index method should be mainly considered. The ecosystem service value based on per unit area evaluation method does not need to be the focus.

Compared with existing research studies, which focus more on the forest ticket system itself and the definition of forest ticket, this study mainly focuses on the forest ticket price formation mechanism, emphasizing how to form the forest ticket price and whether the forest ticket pricing methods are reasonable, which has a certain degree of innovation and research value and can partially fill the gap in related fields. At the same time, this study has certain help for the enrichment of the forest ticket system and the extension of related research studies.

This study examines whether the absolute number heuristic holds for consumers' responses to higher-priced versus lower-priced products. Further, it explores whether the different construal level as induced from presence or absence of a product image can be a boundary condition for the absolute number heuristic.

Four experiments were conducted. In Experiments 1 and 2, participants were presented with a discount either in the amount off or percent off format, for products whose prices were 99 Yuan, 100 Yuan and 101 Yuan, respectively. In Experiment 3, the prices were changed to be 90 Yuan, 900 Yuan and 9,000 Yuan, respectively. In Experiment 4, the prices were 48 Yuan and 480 Yuan, respectively.

Experiment 1 showed neither main effect of discount frame nor interaction between price level and discount frame for all dependent variables (i.e. willingness to pay or WTP, purchase intention, attitude and perceived value), thus posing a challenge to the absolute number heuristic. Notably, the lack of main effect and interaction for purchase intention, attitude and perceived value were replicated in Experiments 2, 3 and 4. With WTP being the dependent variable, however, Experiment 4 showed that the effect of discount frame was dependent on price level.

The current findings pose a challenge to the absolute number heuristic and contribute to the literature by revealing that the joint effects of price level and discount frame can be moderated by whether an ad contains the product image.

It is necessary for marketers to realize that inclusion of a product image may eliminate the effect of discount frame. Specifically, in terms of promoting a relatively expensive product, in order for the percent off discount to enhance the amount of money that consumers are willing to pay, an ad without a product image may be more favorable.

The current study is the first to challenge the absolute number heuristic by showing that the interaction between price level and discount frame is contingent on whether an ad contains the product image.

Though an undervalued Yuan is not the only factor that contributes to the US bilateral trade deficit with China, it is widely accepted as being one of the leading factors. The heightened debate over the value of the Yuan may lead to “beggar thy neighbour” retaliation. The purpose of this paper is to provide a historical review of the Y/$ exchange rate movements, review the US congressional bills to revalue the Y/$ exchange rate and Chinese Government's reactions, presents a conceptual analysis of the effect of the undervalued Yuan on trade between China, the USA, and competitors, and discuss the arguments for and against revaluation of the Yuan.

Conceptual analysis graphically illustrates how the undervalued Yuan affects world trade and shows the benefits and losses for various countries.

Though an undervalued Yuan is not the only factor that contributes to the US bilateral trade deficit with China, it is widely accepted as being one of the leading factors. Due to its effects on production, consumption, and trade, a solution is needed. Although measuring the exact misalignment of the Chinese currency has led to various results, it is generally agreed that the Yuan is undervalued, and the US Congress has been persistent in introducing various bills to tackle the problems arising from the undervalued Yuan. Arguments for and against revaluation has heightened debate which may lead to “beggar thy neighbour” retaliation.

This paper outlines very timely and pretentious trade issues between China and the USA and contributes to the area of research of exchange rate effects on international trade.

The Dim Sum bond market in Hong Kong, which allows China to regulate the amount of offshore yuans that flow back into the mainland, has grown steadily since its inception in 2007 and is expected to surpass in 2013 the threshold level that would attract insurers and long-term issuers to the market. Yet, the market has not matured sufficiently relative to the yuan deposit market in Hong Kong that has grown at a much faster pace on account of trade liberalization and the use of yuans in China’s international trade settlements. Even though Hong Kong has fulfilled its role as an offshore currency center for the yuan, it is being challenged by Taiwan, Singapore, and London in terms of being the premier location for the issuance of yuan-denominated bonds outside of Mainland China.

This paper is a study of how people with heterogonous individual characteristics self-select into different compensation schemes. A laboratory experiment is designed in which “workers” can join “companies” that pay according to various schemes: piece rate, revenue sharing, individual tournament, and team tournament. The main findings are: (1) Subjects with high relative performance always prefer individual tournament. (2) Risk-averse subjects are less likely to choose competitive schemes. (3) Individual tournament attracts fewer women than men, which is partially explained by gender-specific social preferences. (4) Compared to people with siblings, only children are less likely to accept any team-based schemes without information about their teammates. (5) The provision of feedback about relative performance can adjust individuals’ biased self-beliefs and then influence their self-selections.

This study aims to provide a response to the commentary by Yuan on the paper “Marketing or Methodology” in this issue of EJM.

Conceptual argument and statistical discussion.

The authors find that some of Yuan’s arguments are incorrect, or unclear. Further, rather than contradicting the authors’ conclusions, the material provided by Yuan in his commentary actually provides additional reasons to avoid partial least squares (PLS) in marketing research. As such, Yuan’s commentary is best understood as additional evidence speaking against the use of PLS in real-world research.

This rejoinder, coupled with Yuan’s comment, continues to support the strong implication that researchers should avoid using PLS in marketing and related research.

Marketing researchers should avoid using PLS in their work.

This rejoinder supports the earlier conclusions of “Marketing or Methodology,” with additional argumentation and evidence.

The purpose of this paper is to discuss the change in China's exchange rate regime during the 2001‐2009 period, when both the pegged and floating exchange rates were adopted in the country, offering a rare opportunity to address the issue. The effects of China's interest rate differential (IRD) and unemployment rate on the exchange rate are also discussed in this paper.

Given the economic variables are non‐stationary, this paper adopts cointegration analysis to evaluate the long‐term equilibrium in China's economy, with the unit root test, cointegrating test and a vector error correction model also used to scrutinize China' exchange rate regime for different time periods.

The time series data – including the exchange rate, IRD and unemployment rate – are used in the unit root test and Johansen test to verify the long‐term equilibrium between real exchange rate and unemployment rate in specific periods of time. Since the findings indicate no correlation between the exchange rate and IRD, it is possible to predict the value of Chinese yuan based on China's unemployment rate, but not IRD. China's government slows down the appreciation of its currency when the lagged unemployment rate is high.

The paper provides a fresh perspective on the long‐term equilibrium among China's exchange rate, IRD and unemployment by dividing the sample period into several parts, according to the exchange rate policy. The findings indicate that the unemployment rate plays an important role in China's exchange rate regime.

Understanding farmers’ preferences for crop insurance attributes is crucial in designing better insurance products and guiding government policies but such research is lacking, particularly in developing countries. The paper aims to discuss these issues.

This study uses a survey featuring a discrete choice experiment and policy simulation.

Overall, crop insurance has positive values to farmers, although preference is heterogeneous based on socioeconomic characteristics and risk position. Policy simulation confirms the roles of liability in strengthening insurance participants’ welfare and premium subsidy in encouraging participation. Introducing one more product into the market can accommodate farmers’ diverse needs and lead to increases in both aggregated social welfare and participation while maintaining the current level of government expense in subsidy – a potential Pareto improvement.

Methodology employed is not the most novel in the choice experiment literature as many of the advances in choice experiment design could not be applied due to the actual condition in rural China and Chinese farmers’ capability in understanding the experiment.

The results indicate that the current single-product market structure using “low liability with high premium subsidies” cannot accommodate the diverse needs among farmers. Providing more varieties of liability-subsidy combinations, e.g. a high liability with low premium subsidy insurance product, can substantially improve participants’ welfare with little impact to the probability of participation.

The authors believe that this is one of the very few studies that that analyze farmers’ preferences and willingness to pay for the attributes of crop insurance products. It also shows how crop insurance product design can build upon farmers’ choices to achieve a potential Pareto improvement in aggregated social welfare in the context of a fast-developing crop insurance market.

The purpose of this paper is to examine the roles social networks play in households’ contribution to the provision of small hydraulic facilities (SHFs) in rural China.

This paper adopts a sample-selection ordered probit model (Greene and Hensher, 2010) to estimate the impacts of overall social-network intensity, of the number of strong ties (relatives), and of the number of weak ties (friends), using data on 1,064 representative households collected from three provinces (Inner Mongolia, Ningxia, and Shandong).

The numbers of strong ties and weak ties both have significant impacts on households’ willingness to contribute to SHFs provision, but only the latter has a significant impact on their level of contribution. More specifically, a one standard deviation increase in the number of weak ties (i.e. friends) is associated with a 6.6 percent increase in households’ propensity of contributing more than 550 yuan and a 8.2 percent decrease in their propensity of contributing less than 100 yuan.

This paper is the first to examine the impacts of social networks on households’ contribution to SHFs provision in rural China. Its finding is of great policy relevance-fostering and maintaining social networks (e.g. through rural cooperatives) can significantly increase households’ contribution to public-good provision.