ALBERT

Notes: Abstract:  This paper outlines the internationalisation process of cooperatives in an economic environment determined by economic globalisation. The analysis is focused on the Mondragon Cooperative Corporation (MCC) in the Basque Country which is a point of reference for participatory enterprises all over the world. MCC is currently adapting to changing market conditions and pursuing a strategy of direct investment (joint ventures, greenfield investment and acquisitions) in priority international markets. Thus, the first part of the study is about the current situation: the problems and consequences related to the internationalisation process of the MCC. In the second part, we consider an analytical framework for developing measures and strategies which could facilitate international expansion but in a manner which is more in line with cooperative values. The third part focuses on the presentation and discussion, based on this analytical framework, of a number of proposals made within the MCC on international social-economic policy.

Notes: Abstract:  ‘Proximity services’ have been the subject of frequent debate for more than a decade in French speaking countries. They can be defined as services which meet individual or collective needs and which are ‘local’ in either spatial or relational terms. Based on the situation in France, this paper aims to describe the many options available in the field of ‘proximity services’ and examine the support offered by the public authorities for the existing practices, considering that this support is representative of the evolutive relations between State, market and civil society. The limited success of the free market puts the question of a renewal of public intervention, which would accommodate all options available in this area, without being confined to a marketization of this field of activity. For this matter, the political embeddedness of associations and cooperatives is decisive for the future.

Notes: In many European countries, institutional childcare has developed as a field shaped by both statutory and associative agency, the German system being emblematic for this. In Germany, a considerable proportion of childcare services are provided by nonprofit organizations under public regulation. Departing from a historical overview, the article elaborates on the mixed economy of welfare in that system and sheds light on recent transformations of the existing public-private partnership. It is argued that with a range of cultural and civil-society-related evolutions, the system is going to adopt elements of a market regulation that are prone to change the rules of games within the partnership as such.

Notes: This paper analyzes the dynamic relationship between primary and secondary mortgage markets and the short-term and long-term market interest rates. Using a series of monthly data on fixed rate mortgage rates and GNMA rates, we explore the dependence and speed of adjustment in these primary and secondary mortgage rates to each other as well as to the long and short-term government rates. The results indicate that residential mortgage rates in general, appear to follow the long-term rate and are not very sensitive to movements in the short-term interest rate.

Notes: Turkish banks are quite heterogeneous in terms of organizational form, ownership structure, size, age, portfolio concentration, growth prospects and attitude toward risk. They also exhibit strong variations in performance as measured by several efficiency indices. In the light of theoretical advances in corporate finance and financial institutions, this paper is an in-depth cross-sectional analysis of the Turkish banking sector, which explores the various bank, market and regulatory characteristics that may explain the efficiency variations across banks. Consistent with the related hypotheses investigated, the results indicate that a number of independent bank characteristics are significantly correlated with various efficiency measures.

Notes: This paper analyses the flotation costs and the share price reaction of equity offerings in Spain. The results report a positive relationship between relative flotation costs and the underwriting of an issue, and a negative relationship between such costs and ownership concentration. Fixed flotation costs and a negative relationship with the gross offer proceeds are also observed. On average, there is a negative share price reaction on the date of the ‘previous communication’ to the Comisión Nacional del Mercado de Valores. The different sub-samples analysed according to the underwriting of the issue and the discount offered reveal no statistical differences.

Notes: The predictability of stock returns is often assessed using classical statistical significance from predictive regressions. Statistical inference, however, can belie the economic importance with which investors regard various predictors. This paper examines the influence that predictors have on an investor's optimal portfolio allocations. The results show that return predictability is sufficient to induce horizon effects in optimal allocations. After incorporating estimation risk, however, little evidence of predictability remains. We also assess the relative importance of three predictor variables. While dividend yield is the most important predictor, optimal allocations are also sensitive to the term spread and the relative bill rate.

Notes: The so-called disclosure principle is a ‘puzzle’ in the accounting literature: Game theoretic models of financial markets show that in equilibrium firms should disclose all their private information. Yet, the result is not convincing. Researchers have therefore built sophisticated models in order to demonstrate for which reasons the disclosure principle might fail. This note shows that even in the original model there are multiple equilibria. In those equilibria good types disclose and bad types do not. The commonly known full disclosure equilibrium is a limit point of the equilibrium set.

Notes: This paper analyzes stock returns and volatility relations between the Istanbul Stock Exchange (ISE) and the global market as represented by stock markets in the US, the UK, Japan and Germany. Results from monthly data and multivariate cointegration tests suggest that the ISE became significantly integrated in the global market only in the period following market liberalization in late 1989. We also find evidence based on GARCH estimations that capital liberalization actually mitigated, rather than intensified, volatility in the ISE. Our results further suggest that the Asian crisis in mid-1997 and the consequent Russian economic meltdown in mid-1998 are partly responsible for the recent excessive volatility in the Turkish market. The results also identify the US and the UK markets as dominate sources of volatility spillovers for the ISE, even in the period following the Asian-Russian crises. Consequently, it appears that the two matured markets of the US and the UK shoulder significant responsibility for the stability and financial health of smaller emerging markets like the ISE.

Notes: Cross-sectional averages of log returns have been used to measure shareholder wealth effects in several event studies. No adequate explanation of the implied portfolio strategy has ever been provided in the literature. We argue that the method is biased or does not portray a realistic portfolio strategy. It should therefore be used with caution in the event-study' literature.

Notes: This paper re-evaluates the time series properties of financial ratios. It presents new empirical analysis which explicitly allows for the possibility that financial ratios can be characterized as non-linear mean-reverting processes. Financial ratios are widely employed as explanatory variables in accounting and finance research with applications ranging from the determinants of auditors’ compensation to explaining firms’ investment decisions. An implicit assumption in this empirical work is that the ratios are stationary so that the postulated models can be estimated by classical regression methods. However, recent empirical work on the time series properties of corporate financial ratios has reported that the level of the majority of ratios is described by non-stationary, I(1), integrated processes and that the ratio differences are parsimoniously described by random walks. We hypothesize that financial ratios may follow a random walk near their target level, but that the more distant a ratio is from target, the more likely the firm is to take remedial action to bring it back towards target. This behavior will result in a significant size distortion of the conventional stationarity tests and lead to frequent non-rejection of the null hypothesis of non-stationarity, a finding which undermines the use of these ratios as reliable conditioning variables for the explanation of firms’ decisions.

Notes: In this paper we examine the stationarity of all the rates comprising the USD, GBP, DM and JPY spot and forward term structures. Instead of focussing on short maturity interest rates, as most other papers do, we perform a detailed analysis of the whole range of spot and forward interest rates of the 4 main currencies. We investigate the issue of stationarity within the framework of an equilibrium interest rate model such as Vasicek (1977), that defines the cross-sectional and time series properties that interest rates of various maturities must satisfy. We show that within a one-factor interest rate model, such as Vasicek, all interest rates are restricted to exhibit the same mean reverting behaviour. This restriction allows us to apply more powerful panel unit root tests. This methodology increases considerably the number of observations available and as a result the power of the unit root tests. The higher power of these tests allows us to demonstrate that there does exist mean reversion on the spot and forward US interest rates and the forward DM and GBP interest rates.

Notes: This paper addresses the important relationship between stock index and stock index futures markets in an international context. By simply examining the spot-futures relationship within a single country as most of the extant literature does and thus ignoring possible market interdependencies between countries, the dynamics of price adjustments may be misspecified and thus findings misleading. The main contribution of the paper is to improve our understanding of the pricing relationship between spot and futures markets in the light of international market interdependencies. Using a multivariate VAR-EGARCH methodology, the paper investigates stock index and stock index futures market interdependence, that is lead-lag relationships and volatility interactions between the stock and futures markets of three main European countries, namely France, Germany and the UK. In addition, the paper explicitly accounts for potential asymmetries that may exist in the volatility transmission mechanism between these markets. The main conclusions of the paper imply that investors need to account for market interactions across countries to fully and correctly exploit the potential for hedging and diversification.

Notes: This study uses 1991–99 data gathered from the United Kingdom's life insurance industry to test empirically the notion that the reported annual surplus of a life insurer may be influenced by four firm-specific characteristics: namely, reinsurance, output mix, organizational form and firm size. Consistent with expectations, the results indicate that the annual reported surplus is positively related to reinsurance and firm size and negatively related to the degree of product diversification. Contrary to our expectations, however, we find no evidence that proprietary (stock) life insurers tend to report higher annual surpluses than mutual life insurers.

Notes: We delineate Hong Kong listed corporations into three levels of privatization: the fully privatized blue chips, semi-privatized red chips and the least privatized H shares. Both H shares and red chips are mixed enterprises that mimic private ownership with joint government and private stock ownership. We find that mixed enterprises are less profitable and lower valued than the fully privatized blue chips, but red chips are more efficient and perform better than blue chips when market confidence swings to their favor. Regression analysis suggests that increased stock ownership by the government and increased emolument incentives are counterproductive to profitability, especially in bad economic times of the 1997–98 Asian financial crisis.

Notes: The relation between working capital management and corporate profitablity is investigated for a sample of 1,009 large Belgian non-financial firms for the 1992-1996 period. Trade credit policy and inventory policy are measured by number of days accounts receivable, accounts payable and inventories, and the cash conversion cycle is used as a comprehensice measure of working capital management. The results suggest that managers can increase corporate profitablity by reducing the number of days accounts receivable and inventories. Less profitable firms wait longer to pay their bills.

Notes: This paper examines the UK stock market's reaction to the appointment of outside (non-executive) board members. Tests conducted using a sample of 714 appointments reported by EXTEL between 1 July, 1993 and 31 December, 1996, indicate a strong interaction between appointee characteristics and the magnitude of the agency problem: the share price reaction to outside director appointments is significantly more favourable when board ownership is low and the appointee possesses strong ex ante monitoring incentives. In contrast, the appointment of independent and manager-affiliated outside directors does not appear to benefit shareholders on average, even in the presence of serious agency problems.

Notes: This paper uses cointegration and causality tests to study the temporal behavior of dividends and earnings at the individual firm level. We find that, for a sample of 143 non-utility firms, approximately one-fifth of the firms exhibits a temporal relationship between dividends and earnings that is consistent with the information signaling hypothesis of dividends. In the case of 72 utilities, about a third exhibit dividend policies that are consistent with the signaling notion of dividends. Further examination of firm characteristic differences between signaling and non-signaling firms shows that, in the case of non-utility firms, signaling firms tend to be smaller, have a lower growth rate of total assets, and have a higher leverage ratio. In the case of utilities, we find no major differences in firm characteristics between signaling and non-signaling firms.

Notes: This paper analyzes the time-series behavior of residual earnings as it relates to the existence of positive NPV opportunities (or ‘rents’). The issue is of interest because many recent papers (e.g., Lo and Lys, 1999; and Holthausen and Watts, 2001) have commented on it in the context of the Ohlson (1995) model. The analysis shows that the Ohlson (1995) model allows for positive NPV opportunities, contrary to the frequently made claims.

Notes: The nature of the data we usually encounter in market-based accounting research is such that the results of the regressions of market capitalization on financial statement variables (referred to ‘price-levels’ regressions) are driven by a relatively small subset of the very largest firms in the sample. We refer to this overwhelming influence of the largest firms as the ‘scale effect’. This effect is more than heteroscedasticity. It arises due to the non-linearity in the relation between market capitalization and the financial statement variables. We present the case that scale is market capitalization rather than a correlated omitted variable. Since scale is market capitalization, we advocate its use as a deflator in a regression estimated using weighted least squares. This regression overcomes the scale effect and the resultant regression residuals are more economically meaningful. Christie's (1987) depiction of scale is the same as ours but he advocates the use of the returns regression specification in order to avoid scale effects. We agree that returns regressions should be used unless the research question calls for a price-levels regression.

Notes: Asymmetric information and mechanisms for its resolution in the initial public offering (IPO) process are subjects of extensive research and debate. In this paper, we investigate the impact of one such mechanism, namely voluntary disclosure of management earnings forecasts by issuers of IPOs, as a means of reducing asymmetric information as well as ex ante uncertainty. Our focus is on the relative importance of this voluntary disclosure mechanism on both IPO underpricing and post-issue return performance. Our results indicate that management earnings forecasts provide important and incremental information compared to other means of reducing asymmetric information, and these disclosures appear to improve the environment of IPO issuance. For example, our underpricing results show that firms that choose to provide forecasts leave ‘less money on the table’ with a lower degree of underpricing. In terms of post-issue performance, firms whose forecasts turn out to be optimistic are penalized significantly relative to other forecasters and non-forecasters.

Notes: This paper tests the empirical validity of the Ohlson (1995) model on a firm-level time series basis. The coefficients of the earnings dynamic and valuation equations are first estimated by OLS. Next, recognizing the nonlinear relationships among the parameters, each equation is estimated by nonlinear Least Squares. Lastly, the model is estimated as a restricted system by nonlinear Least Squares and nonlinear SUR. In all cases, parameters are endogenously estimated. Irrespective of the estimation method, the Ohlson model often yields inconsistent or insignificant parameter estimates. Nevertheless, point estimates of equity risk premia are similar to those obtained from alternative methodologies.

Notes: Consumer credit has become an enormous business in industrialized countries. Recently, finance agencies have started to develop new products aiming not only to widen their portfolio but also to keep active relationships with good clients already taken on file and to prevent bad clients from becoming a loss for the agency. As a result, models for the whole behaviour of the clients are necessary. They involve many related outcome variables, which altogether give a measure of whether the client revealed to be profitable or unprofitable. This paper aims to show the potential of graphical chain models in the described context.

Notes: A sample of firms where employee stock options and other long-term incentives are absent but an annual bonus is required is examined. A positive relation is found between firm equity value and stock bonus but not cash bonus. The positive relation is stronger when the firm has greater investment opportunities. Additionally, the relation is shown to be nonlinear in the sense that the marginal effect of stock bonus on equity value is positive but decreasing (negative) when the stock bonus is below (above) the breakpoint. Overall, the annual stock bonus is valued positively by investors even though it is linked to the firm's contemporaneous but not future performance.

Notes: This multi-method study reports the results of two complementary experiments investigating the relevance of cash flow and accrual information. A behavioural field experiment investigated differences in the accuracy of solvency assessments between commercial lending managers using cash flow information and those using accrual information. Results indicated that commercial lending managers using cash flow information made more accurate solvency assessments than managers using accrual information. Results of an archival quantitative modeling experiment complemented these results and indicated cash flow information had incremental information content beyond accrual information. Our results confirmed the decision-usefulness of cash flow information and supported the mandate of the Statement of Cash Flows.

Notes: In this paper we use a simultaneous equations model to examine the relationship between analysts’ forecasts, analyst following, and institutions’ investment decisions. Estimates of our three equation model using US data indicate that higher institutional demand leads to greater optimism among analysts and lower analyst following. At the same time, institutional demand increases with increasing optimism in analysts’ forecasts but decreases with analyst following. We also investigate firm characteristics as determinants of analysts’ and institutions’ decisions. Empirical estimates of the effects of these characteristics indicate that agency-driven behavioral considerations are significant.

Notes: There is a gap between the theoretical literature which almost unanimously advocates the privatization of enterprises, as part of the solution to the commitment problem in economies in transition, and the empirical evidence regarding the best way to design a privatization program in order to secure an efficient use of resources. This paper contributes to this debate by focusing on the determinants of the financial long-run performance of privatized firms in Poland, Hungary, and the Czech Republic. This long-run performance is mainly influenced by the extent of retained state ownership, the choice of privatization method, and firm size.

Notes: In this paper we examine the market reaction to the announcement by Fortune of the ‘Best 100 Companies to Work for in America.’ Employees rate firms based on several criteria including trust in management, pride in work/company and camaraderie. To examine long-term performance, we calculate raw and risk-adjusted returns and then compare them to the returns of a matched sample of firms. In addition, we calculate the return on a buy and hold investment in the sample firm less the return on a buy-and-hold investment in a matched sample firm (BHARs). We find a statistically significant positive response to the announcement of the ‘100 best companies to work for’ by Fortune. Also, based on all measures of risk-adjusted return, we find these firms generally outperform the matched sample of companies. The BHAR results, although not exhibiting the level of statistical significance, are consistent with the raw and risk-adjusted return results.

Notes: Previous returns studies have shown that extreme earnings and extreme cash flows from operations are less informative than moderate (i.e., less extreme) earnings and moderate cash flows. Studies also report that cash flows supplement to earnings in firm valuation by showing a higher association of cash flows with returns when earnings are extreme than when earnings are moderate. We propose that this supplementary role of cash flows is affected by cash flows extremity. Using data from the US capital markets, we find that the supplementary role of cash flows exists only when cash flows are not extreme. We also investigate the supplementary role of earnings to cash flows and search for a higher association of earnings with returns when cash flows are extreme than when cash flows are moderate. Similar to results on cash flows, our findings show that the supplementary role of earnings exists only when earnings are not extreme. Our results imply that investors and researchers should consider both earnings and cash flows extremity when assessing the information content of these variables.

Notes: This study examines various factors that potentially explain cross-sectional variations in UK corporate managerial discretion to switch towards a market-based actuarial pension valuation method for pension funding and reporting purposes. Evidence is based on accounting, actuarial and share market data for an industry-matched pair sample of 90 UK firms. Consistent with our hypotheses we find that companies have a greater propensity to switch actuarial methods if they use lower discount rates, lower flow funding ratios and sponsor larger pension plans in the pre-switch valuation year. These findings are consistent with the traditional perspective, which implies that UK corporate switching decisions are explained by characteristics of their defined benefit pension funds. The results run contrary to the findings of earlier US based studies that find that such choices can be explained from an alternative corporate financial perspective.

Notes: The aim in this paper is to replicate and extend the analysis of visual technical patterns by Lo et al. (2000) using data on the UK market. A non-parametric smoother is used to model a nonlinear trend in stock price series. Technical patterns, such as the ‘head-and-shoulders’ pattern, that are characterised by a sequence of turning points are identified in the smoothed data. Statistical tests are used to determine whether returns conditioned on the technical patterns are different from random returns and, in an extension to the analysis of Lo et al. (2000), whether they can outperform a market benchmark return. For the stocks in the FTSE 100 and FTSE 250 indices over the period 1986 to 2001, we find that technical patterns occur with different frequencies to each other and in different relativities to the frequencies found in the US market. Our extended statistical testing indicates that UK stock returns are less influenced by technical patterns than was the case for US stock returns.

Notes: We study the effect of different acquirer types, defined by financial status and their payment methods, on their short and long-term performance, in terms of abnormal returns using a variety of benchmark models. For a sample of 519 UK acquirers during 1983–95, we examine the abnormal return performance of acquirers based on their pre-bid financial status as either glamour or value acquirers using both the price to earnings (PE) ratio and market to book value ratio (MTBV). Value acquirers outperform glamour acquirers in the three-year post-acquisition period. One interpretation is that glamour firms have overvalued equity and tend to exploit their status and use it more often than cash to finance their acquisitions. As we move from glamour to value acquirers, there is a greater use of cash. Our results are broadly consistent with those for the US reported by Rau and Vermaelen (1998). However, in contrast to their study, we find stronger support for the method of payment hypothesis than for extrapolation hypothesis. Cash acquirers generate higher returns than equity acquirers, irrespective of their glamour/ value status. Our conclusions, based on four benchmark models for abnormal returns, suggest that stock markets in both the US and the UK may share a similar proclivity for over-extrapolation of past performance, at least in the bid period. They also tend to reassess acquirer performance in the post-acquisition period and correct this overextrapolation. These results have implications for the behavioural aspects of capital markets in both countries.

Notes: This paper analyses the agency explanation for the cross-sectional variation of corporate dividend policy in the UK by looking at the managerial entrenchment hypothesis drawn from the agency literature. Consistent with predictions, a significant U-shaped relationship between dividend payout ratios and insider ownership is observed for a large (exceeding 600 firms) sample of UK companies and two distinct periods. These results strongly suggest the possibility of managerial entrenchment when insider ownership reaches a threshold of around 30%. Evidence is also presented that non-beneficial holdings by insiders can lead to entrenchment in conjunction with shares held beneficially.

Notes: In this study, we provide evidence on the stationarity of real audit fees and the major explanatory variables frequently used in the audit pricing models from a pooled data set, using panel unit root tests developed by Im et al. (1997). The panel unit root test supports the hypothesis of non-stationarity of audit fees and their major determinants. We demonstrate that variables in the audit pricing model that were previously found to have impact on audit fees may turn out to be useless when more powerful tests like panel tests are applied to these variables. Our evidence implies that failing to employ appropriate procedure to test cointegration and to specify the appropriate model for audit fees and their determinants would generate results that may have exaggerated the effects of some variables on audit fees.

Notes: We assess the valuation implications of the fair value disclosures made for publicly traded securities accounted for under the equity method. We test the association between investors' stock price metrics and fair value disclosures while controlling for book values on a sample of 172 investor firm-years during 1993–1997. Our results indicate that the information in the fair value disclosures is incremental to the information provided by both an investment's equity method book value and equity method reported income. This suggests that there is nothing unique about investments in publicly traded common stock that involve significant influence that makes the fair value disclosures irrelevant for firm valuation.

Notes: Prior studies of audit reporting in the UK only analyse either very small, private companies, or large listed companies. In addition, these studies focus on narrowly defined types of modified audit reports, respectively the ‘small company’ audit qualification, and going-concern related modifications. In contrast, this paper employs a multinomial logit model to analyse the determinants of both going-concern and non going-concern related audit modifications, including modifications for disagreements and limitations on scope. Furthermore, this paper analyses reports over a wide range of both private and public (listed and non-listed) companies. The determinants of audit reports are shown to differ between different types of audit modification. In addition, subsidiary companies hiring large auditors are significantly less likely to receive non going-concern related modifications, whereas non-subsidiary companies hiring large auditors are significantly more likely to receive going-concern related modifications.

Notes: I posit and test two competing views on the significance of outside director tenure lengths; the expertise hypothesis suggesting that extended board service time is a sign of director commitment, experience, and competence and the management-friendliness hypothesis suggesting that extended board service time marks directors who befriend management at the expense of shareholders. I find evidence that Senior directors, defined as directors with twenty or more years of board service, are almost twice as likely to occupy a ‘management-affiliated’ profession compared to the rest, and that they are also more likely to staff the firm's nominating and compensation committees. Senior director participation in the compensation committee is associated with higher pay for the CEO, especially when the CEO is more powerful in the firm. These results are consistent with the management-friendliness hypothesis, and highlight a need for setting term limits for directors.

Notes: We bring together three disparate strands of literature to develop a comprehensive empirical framework to examine the efficiency of security analysts' earnings forecasts in Singapore. We focus specifically on how the increased uncertainty and the negative market sentiment during the period of the Asian crisis affected the quality of earnings forecasts. While we find no evidence of inefficiencies in the pre-crisis period, our results suggest that after the onset of the crisis, analysts (1) issued forecasts that were systematically upward biased; (2) did not fully incorporate the (negative) earnings-related news; and (3) predicted earnings changes which proved too extreme.

Notes: In this paper, we examine whether the ‘reverse’ weekend effect recently documented by Brusa, Liu and Schulman (2000) is concentrated in a few industries or widely spread across all the industries. The findings in this paper indicate that the ‘reverse’ weekend effect exists not only in broad indices, but also in most industries. The results suggest that the ‘reverse’ weekend effect may be driven by economic events that affect all industries, rather than industry-specific factors. Although the patterns of Monday returns are similar between broad indices and industry indices, they are different between the pre- and the post-1988 periods. Monday returns tend to be negative in the pre-1988 period, but tend to be positive in the post-1988 period, for both broad market indices and industry indices. These conclusions are valid even after considering the influence of the month-of-the-year and the week-of-the-month effects.

Notes: This paper provides another test of the litigation hypothesis proposed by Hall and Stammerjohan (1997) and provides evidence that subtle differences in the underlying business environment may be very important in predicting the accounting reaction of management to major events. The litigation hypothesis predicts that firms that are defendants in litigation with potentially large damage awards (major litigation) will attempt to reduce the size of those damage awards by making income-decreasing accounting choices. The oil firms in the Hall and Stammerjohan study appeared to systematically reduce reported earnings during the litigation periods by under-reporting new reserves. The fourteen chemical and pharmaceutical firms, involved in fifteen litigation events, examined by this study produce a very different result. The chemical and pharmaceutical firms faced a different business environment during their litigation periods and appear to have made income-increasing accounting choices. These firms appear to have been able to perpetuate earnings growth without corresponding sales revenue growth during the litigation periods through unexpected reversals in deferred income tax expense.

Notes: We state an Aggregation Theorem which shows that the recursion value of equity is functionally proportional to its adaptation value. Since the recursion value of equity is equal to its book value plus the expected present value of its abnormal earnings, it follows that the adaptation value of equity can normally be determined by a process of simple quadrature. We demonstrate the application of the Aggregation Theorem using two stochastic processes. The first uses the linear information dynamics of the Ohlson (1995) model. The second uses linear information dynamics based on the Cox, Ingersoll and Ross (1985)‘square root’ process. Both these processes lead to closed form expressions for the adaptation and overall market value of equity. There are, however, many other processes which are compatible with the Aggregation Theorem. These all show that the market value of equity will be a highly convex function of its recursion value. The empirical evidence we report for UK companies largely supports the convexity hypothesis.

Notes: This paper examines the determinants of external credit ratings attained by insurance firms in the United Kingdom (UK) and of the likelihood that insurers will have such an assessment. Using panel data relating to A.M. Best-rated and Standard and Poor's (S&P)-rated insurers over the period 1993–1997, a trichotomous logit model and an ordered probit model with sample selection are employed to show that the factors which influence the likelihood of having external credit assessments not only vary between the two agencies but also differ from those which determine the ratings themselves. Our results are shown to be of potential interest to participants in the insurance industry and policy-makers alike.

Notes: This study investigates why firms adopt long-term performance plans. The results provide evidence that firms that adopt long-term performance plans have higher risk as measured by Beta, have lower percentages of managerial stockholdings, have higher levels of investment in research and development expenditures two years prior to adoption of a long-term performance plan, and experience increases in the ratio of debt to total assets in the two year period prior to long-term performance plan adoption. Also, firms increase their investments in research and development and capital expenditures following adoption of long-term performance plans.

Notes: This study examines the mispricing and time between arbitrage trades of the Hong Kong Hang Seng index futures and index options contracts under various stressed market conditions. Ex-ante trading profits and differences in time between trades across up and down as well as stressed and non-stressed markets are used to measure how well the derivative markets perform under emotional distress. We find evidence of illiquidity in stressed and down markets. In stressful markets and down markets, liquidity suppliers are less likely to trade against the informed traders. This, in turn, leads to longer time between trades and higher arbitrage profits.

Notes: It is now widely accepted that contrarian, or value investment strategies deliver superior returns. Gregory, Harris and Michou (2001) examine the performance of contrarian investment strategies in the UK and find that value strategies formed on the basis of a wide range of measures of value have delivered excess returns that are both statistically and economically significant. However, while value strategies appear to be profitable, the reason for their superior perform- ance is far from clear. Under the contrarian model, value strategies are profitable because they are contrarian to naïve strategies such as those that erroneously extrapolate past performance, while under the rational pricing model, value strategies are profitable because they are fundamentally riskier in some sense. In this paper, we discriminate between these two possibilities by undertaking a comprehensive investigation of the relationship between the returns to value investment strategies and various macroeconomic state variables that in a multi-factor asset pricing model could reasonably be taken as proxies for risk. Moreover, we examine whether the returns to value strategies predict future GDP, consumption and investment growth over and above the contribution of the Fama and French (1993 and 1996) SMB, HML and market factors. While the SMB and HML factors behave in a manner consistent with the rational pricing model, we show that some value strategies in the UK are able to generate excess returns that do not seem to be related to known risk factors.

Notes: The IASC recently recommended that employee compensation in the form of stock options be measured at the ‘fair value’ based on an option pricing model and the value should be recognized in financial statements. This follows adoption of SFAS No. 123 in the United States, which requires firms to estimate the value of employee stock options using either a Black-Scholes or binomial model. Most US firms used the B-S model for their 1996 financial statements. This study assumes that option life follows a Gamma distribution, allowing the variance of option life to be separate from its expected life. The results indicate the adjusted Black-Scholes model could overvalue employee stock options on the grant date by as much as 72 percent for nondividend paying firms and by as much as 84 percent for dividend paying firms. The results further demonstrate the sensitivity of ESO values to the volatility of the expected option life, a parameter that the B-S model or a Poisson process cannot accommodate. The variability of option life has an especially big impact on ESO value for firms whose ESOs have a relatively short life (5 years, for example) and high employee turnover. For such firms, the results indicate a binomial option pricing model is more appropriate for estimating ESO value than the B-S type model.

Notes: We bring together three disparate strands of literature to develop a comprehensive empirical framework to examine the efficiency of security analysts' earnings forecasts in Singapore. We focus specifically on how the increased uncertainty and the negative market sentiment during the period of the Asian crisis affected the quality of earnings forecasts. While we find no evidence of inefficiencies in the pre-crisis period, our results suggest that after the onset of the crisis, analysts (1) issued forecasts that were systematically upward biased; (2) did not fully incorporate the (negative) earnings-related news; and (3) predicted earnings changes which proved too extreme.

Notes: This paper is focused on the cost of raising capital in Germany. A cross-sectional analysis of flotation cost data for 117 IPOs over the years 1993–1998 is presented. We find average flotation costs to be 7.77 percent of gross proceeds, while underwriting fees average 5.01 percent. Our results extend the literature in two important directions. First, contrary to the conventional economies of scale view we find marginal spreads to be rather constant in gross proceeds and to be higher for more risky and more complex offerings. Fixed costs amount to 5 to 9 percent of underwriting fees. Second, by applying a principal component analysis we find issue size, an issuer risk factor, and an offering method complexity factor to have an economicaly meaningful impact on underwriting fees.

Notes: This paper tests two competing hypotheses describing investors’ behavior: the efficient market hypothesis and the functional fixation hypothesis. In particular, this study examines how Taiwan's stock market interprets the nature of corporate income tax after the 1998 Tax Reform, which switches from the classical tax system to the integrated tax system. This Tax Reform changes the nature of corporate income tax from a pure operating expense to an individual shareholder's tax credit, but current GAAP still treats it as an operating expense in the income statement. The empirical results show that Taiwan's stock market perceives the change in nature of corporate income tax and responds accordingly.

Notes: Participation at the local level is an important factor in determining the success of programmes developed to achieve sustainable development. This paper is concerned with debates over the role of the individual citizen in relation to that participatory process. In particular, it focuses on the UK Governments’ citizens environmental initiative ‘Going for Green’ (GFG). Through this initiative a five-point Green Code was developed to assist in the delivery of its sustainable development message to the general public. The initiative's overall approach to participation was based on an assumption that the primary barrier to translating environmental concern into local action was a lack of information, and that individuals would respond to messages in a similar way. As a research strategy, the case study was used to evaluate how the initiatives’ pilot Sustainable Communities Project was implemented in two comparative geographical communities in Merthyr Tydfil (South Wales). Research findings from this study have demonstrated that the case study was invaluable in terms of understanding the participatory process and experiences of broad a range of community stakeholders. Promoting a single model of participation, GFG was found to restrict the participatory process in terms of who was encouraged to participate, the scope of their participation, and those outcomes that could be achieved. This paper concludes that if significant progress is to be made in relation to achieving sustainable development, the role of the individual citizen needs to be extended beyond that of a consumer of the environment, and involve active participation in a process that is based on collective action.

Notes: This paper examines the influences of question wording on consumers’ levels of support for genetically modified organisms (GMOs) in food products. Pairs of questions, offering varied amounts of information on the benefits and risks of GMOs, are posed to consumers in a specific geographic area (Vermont, USA) to ascertain the factors that impact on levels of support for this technology. A multivariate analysis is conducted to examine how knowledge, attitudes, and behavioural intentions affect changes in levels of support. The findings suggest that consumers’ levels of support do vary based on question wording. It is further found that knowledge and behavioural intentions play a consistently significant role in influencing change in support for GMOs. Implications for both consumer advocacy groups and industry groups are discussed.

Notes: The use of biotechnology in food production has generated considerable debate involving the benefits and risks associated with its use. Consumer acceptance of genetically modified foods is a critical factor that will affect the future of this technology. Using data from a national survey, this study examines how public acceptance of food biotechnology is related to consumers’ socioeconomic and value attributes as well as the benefits associated with the use of this technology. Empirical results suggest that consumer acceptance of food biotechnology increases considerably when the use of this technology brings tangible benefits for the public. Consumers with different socioeconomic and demographic attributes have diverging views of food biotechnology only when its use brings specific benefits to them. When the use of genetic technology confers no additional benefit, public attitudes towards genetically modified foods are driven primarily by their scientific knowledge, views of scientists and corporations associated with biotechnology as well as public trust and confidence in government.

Notes: A study to compare milk yield, some physico-chemical properties and the chemical composition of milk from 23 indigenous Malawi goats and 10 Malawi local × Saanen crosses was carried out from January to March 2000. The results showed that the average milk yield from the crosses (102.0 ± 11.21 kg) was higher (P 〈 0.01) than that from the indigenous goats (37.1 ± 4.79 kg). However, the pH and specific gravity of both milk samples did not differ significantly from each other. The latter was attributed to the fat and total solids contents, which did not differ significantly in the two milk samples. Although the crude protein content was not significantly different, lactose and minerals, namely calcium, sodium, magnesium, potassium and chloride, were higher (P 〈 0.01) in milk from the crosses than in milk from the indigenous goat. The results have shown that the levels of nutrients in goat milk are high, and this is indicative of its potential to improve the diets of rural Malawians. Also, as smallholder farmers sell raw unheated milk to the processing plants, such milk should not be kept for〉 33 h in the cool dry season and for not〉 20 h in the hot dry season. Farmers can also adopt a charcoal cooler to save the milk for an even longer time than they can at room temperature. In this case, the raw milk can only be stored for not〉 20 h in the cool dry season and not〉 16 h in the hot dry season.

Notes: This article examines how the price knowledge of Finnish consumers has changed since the adoption of the euro. Our study measures price knowledge by comparing consumers’ price estimations with actual market prices at two points in time: before (October 2001) and after (March 2002) the changeover to the euro. Furthermore, we study potential differences between three different age groups. We approach the issue using four determinants, namely (1) response percentage (the percentage of respondents who were able to give a price estimate); (2) the difference between the median of the market prices and the median of the price evaluations; (3) the difference between the average of the market prices and the average of the price evaluations; and (4) the average of the absolute deviations between the average of product prices and consumer price evaluations. Our results indicate that, on average, consumers know the prices of grocery products quite well despite the prevailing dispersion of actual prices in the market. Price knowledge was found to be rather good both before and after the introduction of the euro. Nevertheless, the good price knowledge after the changeover was probably because consumers remembered the prices asked in the old currency and converted them to euros. The majority of respondents were able to give price estimates that were within the range of actual price dispersion in stores. The results also show some deterioration in price knowledge after the advent of the euro. There was variation between different age groups, and it seems that the introduction of the euro has affected various groups differently. Consumers aged 30–50 years knew prices best both before and after the euro, whereas the ability to estimate prices had declined most among consumers above 50 years after the euro changeover.

Notes: The sensory quality characteristics of four flavoured soymilk samples including vanilla, banana, coffee and chocolate were evaluated at varying concentrations of the flavour. This was done to establish the most acceptable flavour and desired concentration for commercial production of soymilk and also to facilitate increased consumption of soymilk for improved nutrition. Hot extraction of the milk from blanched soybeans was achieved by blending in hot water and sieving through muslin cloth. Different concentration levels of the flavours being assessed, namely chocolate, coffee, vanilla and banana, were added. Consumer preference for the various samples was assessed using a nine-point hedonic scale. Addition of flavours was found to improve the sensory characteristics and consumer preference of soymilk. Colour, taste, aroma, mouthfeel and hence overall acceptability of the soymilk samples were improved significantly by the addition of vanilla, banana, coffee and chocolate flavours. The maximum concentrations of the individual flavours for optimal sensory impact were established. Based on the results, the following flavour concentrations are recommended per 100 ml of soymilk: 0.03% vanilla, 0.01% banana, 1.5% coffee and 4% chocolate.

Notes: In 2002 and 2003, I was selected as a funded consumer representative and a member of the Board of Trustees of the National Association of Insurance Commissioners (NAIC). This abstract describes the experience and what it means to empower consumers. Although the example given is from the US, the principles are applicable to other countries.NAIC is the association of the chief insurance regulators of the 50 states, four territories, and the District of Columbia. As a consumer representative I attend four national meetings each year to speak up on behalf of the fair and equitable treatment of consumers. The purpose of NAIC is to improve state insurance regulation by facilitating a degree of uniformity of regulation among the states (Cude, 1997). To ensure that consumers were heard, NAIC created its Consumer Participation Program in 1992 (Cude, 1995).At a typical meeting, there are about 500 regulators, 1000 industry representatives, and 13 consumer representatives. Five of the 13 are selected to serve on the Board. The consumer representatives include professors, lawyers, economists, and community activists. Being so few in number, the question arises: How effective can we be? The fundamental responsibility is to represent consumers’ viewpoints, to give authority to or to voice their perspective that is the definition of empowerment. This quite literally means going to the microphones at NAIC meetings, but it also means working behind the scenes drafting policy and model laws.According to A. Coskun Samli (2001), empowering the consumer will benefit society as a whole. It will expand the economy. Serving as a consumer representative is indeed a worthwhile challenge, a chance to change things for the better.

Notes: Many researchers have studied and documented the financial literacy of youth. Even more have developed educational programs or curricula to teach financial and consumer issues to youth; however, few have actually evaluated the effectiveness of their programs. The Money Talks: Should I be Listening? curriculum, developed by a University of California Cooperative Extension team, was created to appeal to teenagers as it increased their financial literacy. In order to develop a program that young people would readily use, and from which they would learn, teenagers were surveyed prior to program development to determine the topics that were relevant to them, the educational format that appealed to them, and when and where they preferred to receive the information (Varcoe, Peterson, Garrett, Martin, Rene, & Costello, 2001).This paper discusses the effectiveness of The Money Talks: Should I be Listening? curriculum on the financial knowledge and behaviour of participants using the series. The curriculum was designed for use as a part of school curriculum as well as for presentation in other venues.The findings indicate that using the curriculum did improve the financial literacy of high school students with significant positive changes in both knowledge and behaviour. They have a better understanding of the value of savings and have changed behaviours. It is interesting to note that the males demonstrated a significantly greater increase in knowledge from pre-test to post-test than females. Perhaps the females have more interest in or knowledge of financial issues prior to participation in this project?Overall the results of this study are consistent with the findings of others. Research based curricula in personal finance seem to yield results. This age group has specific requirements for method of delivery and location of the seminars suggesting that it is important to keep the materials interactive. To address this issue, a web-site was added to the program. Included on the web-site are interactive games and a video on the importance of saving. The teens are naturally more interested in learning about the consumer and financial issues they perceive as salient in their lives at that particular time. Educators should identify topics of interest to the teens and develop, or use existing, interactive methodology to present the information.

Notes: In a world where the role of women in decision-making is seldom adequately appreciated, they make a remarkable contribution due to their hard work and sense of confidence. It is observed that women are mostly involved in repetitive and monotonous household work irrespective of the fact that they share most of family responsibilities and perform a wide range of duties in and outside home. On the other hand men perform activities, which require skills, but there is sufficient evidence, which show a clear, although slow shift of stereotype sex roles.In early societies, decision-making was predominantly done by menfolk being the breadwinner of the family. With modernization and education women have been empowered to make the best use of human and non-human resources in management of the family with respect to efficient use of time and energy. So, a study was undertaken to know how far the working women of Faridkot district participate in the decision-making process with the following objectives:〈list style="custom"〉(a) to find out the level of participation of working women in the decision-making process as consumer.(b) to find out the level of difficulty among working women at different steps of the decision-making process.The present investigation pertaining to Faridkot district of Punjab state of India was exploratory in nature. A sample of 100 working women was selected by simple random sampling procedure. The responses were recorded through a well structured and pretested questionnaire including an index developed to measure level of participation and difficulty as realized by working women in the decision-making process. After collecting the data, it was analysed by employing simple statistical tests like frequency percentagesThe important findings emanated out of the present investigation are as follows:〈list style="custom"〉• Most of the respondents were middle aged, educated up to graduation level, having nuclear family, small size of family with monthly income more than Rs.5000.00. It was also observed that majority of the respondents were in the teaching and medical professions.• Working women were found to be involved more in the case of food items (79.0–93.0%) as compared to non-food items (6.0–46.0%) with an exception of their major participation (78.0%) at the stage of identifying the problem in case of non-food items.• The study revealed that the time consumed at various steps of consumer decision-making process is minimum for most of the steps in case of food items but moderate to maximum in case of non-food items. But for analysing the alternatives the time consumed was moderate to maximum for both the categories.• Findings also revealed that difficulty level was from moderate to high (32.0–98.0%) in most of the steps in case of food items whereas, in case of non-food items it was from low to high (11.0–78.0%)

Notes: An extensive body of evidence exists linking low income, poor diet and poor health (Graham, 1993; Dowler and Calvert, 1995; Parker, 1998). In response to this the UK government has long claimed the reason for such inequalities is not because of income per se, but is underpinned by lack of knowledge and skills and as such has focused much attention on the role of small scale community based educational initiatives. These initiatives however, can only be successful if those whom they are targeted at are motivated to become involved. To achieve change it has to be recognised that change is possible, but perhaps more importantly, that change is needed.Previous research has produced quantifiable evidence as to the quality of diet and it has also produced qualitative support of the difficulties faced by low income groups in attaining diet quality, but in many cases has not necessarily described the perception of diet quality amongst low income groups, and the influences upon such perceptions. If diet is not perceived to be nutritionally inadequate it may be the case that those whom initiatives would hope to influence do not feel the need to become involved.Using a mixed methodology, evidence is provided from a cohort of lone parents that suggests a confusion may exist between what constitutes a balanced diet as opposed to a healthy diet, or indeed a good diet as opposed to a bad diet. Evidence further demonstrates that many of the food choice decisions made by lone parents are linked to evaluations of the quality of parenting they provide. As such, choices are made subject to social norms yet lack of self-efficacy prevents many lone parents from challenging societal prescriptions. The paper concludes that knowledge alone may not be enough to facilitate an improvement in diet quality for this group and that this may only be achieved if knowledge and empowerment are addressed simultaneously.

Notes: A community-based food hygiene initiative was piloted in the Toxteth–Granby area of Liverpool between December 2001 and March 2002. The project aimed to increase awareness and behaviour, related to poor food purchase, storage and handling practices,     by     actively     involving     members of the local community in home-based peer-facilitated training.Facilitators (23) were actively recruited from within the Toxteth–Granby community, and undertook a 4-day induction and training programme, which included successful completion of the CIEH Basic Food Hygiene course. Facilitators subsequently recruited and visited nearly 1000 households (992) within the Toxteth–Granby electoral ward, undertook an observation sheet, a detailed questionnaire, and spent approximately 1 hour delivering food hygiene training. Facilitators returned to all households within an 8-week period, and completed further observation sheets and questionnaires, for use in a comparative analysis. Facilitators and householders received incentives for their involvement in the project.Analysis of the data collected showed that general awareness of a range of food hygiene issues was high (such as hand washing before handling food), and most participants (73.8%) were able to recognise the main symptoms of food borne disease. As a result of the home-based hygiene training there were significant changes in knowledge, attitudes, and food handling practices, including the use of refrigerators, purchase of chilled and frozen foods, washing or peeling of fruits and vegetables, and the cooking of meat-based products.The project demonstrates that it is possible for communities to improve their food hygiene awareness and food handling behaviours through home-based peer-facilitated training programmes, with minimal input from professionals.

Notes: Cross contamination by microbial pathogens in the kitchen environment may play an important role in many cases of food borne illnesses. Hand washing has been shown to be one of the most important factors in controlling the spread of microorganisms and in preventing the spread of disease. However, educational campaigns such as distribution of information leaflets, workshops, performance feedback and lectures have been, at best, associated with a transient improvement in compliance rates. In addition, the majority of research investigating UK consumers’ food safety behaviour has examined self-reported as opposed to actual hand washing behaviour.This research utilises psychological theory in an attempt to understand how one might design a more effective hand washing campaign. Social cognition models were utilised to explore the relationship between consumers’ knowledge, attitudes, self-reported and actual hand washing behaviour. The research was conducted in two stages. Firstly, salient beliefs of 100 consumers towards food safety were obtained using open-ended questions. Secondly, the food handling practices of 40 consumers were observed and their food safety attitudes and knowledge determined using structured questionnaires.All the participants were knowledgeable about hand washing techniques, intended to wash their hands and generally had positive attitudes towards the importance of washing their hands. However, none of the participants adequately washed their hands on all appropriate occasions. The attitude statement results suggest measures of perceived behavioural control, perceived barriers and perceived risk may provide developers of food safety intervention materials with more useful information compared with measures of consumers’ knowledge or intention. Issues of habit and optimistic bias also need to be given consideration when designing intervention materials to change hand washing behaviour of consumers.

Notes: People are becoming more health conscious nowadays, but most of them are not able to adopt a lifestyle with adequate physical exercise and a healthier eating pattern. Many attempt to compensate by taking ‘health foods’. Despite the recent economic recession, the functional food market expands rapidly in Asian countries. Recent statistics indicate a huge increase in weight loss and functional food product advertising expenditure in Hong Kong and other Asian countries. In a massive survey conducted by the Hong Kong Consumer Council, it was found that 85% of the medicines, health food and therapies sampled contain questionable claims and misleading messages (Consumer Council, 1999). In fact, young people do not understand much about modern food processing, in particular those present in low energy and functional foods, and they know very little about the modern food marketing strategies. The situation is detrimental to consumer welfare especially to the younger generation.This study attempts to reflect critically on the implications of these issues for the health and well-being of young people in Hong Kong. It explores directions for designing relevant and effective education programmes to empower young people in understanding food advertising strategies and making informed decisions on food choice. The paper will begin with a critical review on the current situation in Hong Kong. An interview survey on preservice and in-service teachers’ perception towards misleading food advertising and labelling will then be reported. The situations at schools will be defined and problems faced by teachers in providing relevant consumer education programmes to students will be identified. Finally, the study will look to the future, with a view to developing students’ critical skills in evaluating claims offered in food advertisements.

Notes: Participation at the local level is an important factor in determining the success of programmes developed to achieve sustainable development. This paper is concerned with debates over the role of the individual citizen in relation to that participatory process. In particular, it focuses on the UK government's citizens’ environmental initiative ‘Going for Green’. Through this initiative a five-point   Green   Code   was   developed   to   assist   in   the   delivering of its sustainable development message. The initiative's overall approach to participation was based on an assumption that the primary barrier to translating environmental concern into local action was a lack of information, and individuals would respond to messages in a similar way.As a research strategy, the case study was used to evaluate methods and processes used to implement the initiative's pilot Sustainable Communities Project in two comparative geographical communities in Merthyr Tydfil (South Wales). Research findings from this study have demonstrated that the case study was invaluable in terms of understanding the participatory process and experiences of a broad range of community stakeholders. Promoting a single model of participation was found to restrict the participatory process in terms of who was encouraged to participate, the scope of their participation, and those outcomes that could be achieved. This paper concludes that if significant progress is to be made in relation to achieving sustainable development, the role of individual citizens needs to be extended beyond that of a consumer of the environment, and also include active participation in a process that is based on collective action.

Notes: Sustainability is one of the most important issues facing the world today, and yet many consumers are confused about what the term means. The question of how to create and maintain a sustainable lifestyle is a complicated one. How can we live in a way that meets the needs of the present generation without compromising the ability of future generations to meet their own needs? Would consumers understand the issue better if we used the phrase ‘responsible consumption’?The Welsh Consumer Council is working on a number of projects that look at different aspects of sustainable development. Wales has one of the only governments in the world with a statutory duty to promote sustainable development, and yet patterns of consumption are spiralling out of control. If everyone in the world lived like consumers in Wales, we would need nearly two extra planets to sustain ourselves. In the fields of energy, food, waste, water, and travel, we are using up far more resources than can be replenished.This paper will examine the progress of sustainable development in Wales in the wake of the World Summit on Sustainable Development in Johannesburg in August 2002. It will provide an overview of current consumption patterns and will identify some of the main factors inhibiting people in Wales from making more sustainable consumer choices. It will examine the popular image of sustainability, and will also identify what drivers are in place to encourage sustainable consumption.

Notes: To date, few studies have empirically examined specific values with respect to the global teenager hypothesis. In testing the global teenager hypothesis, this study investigates similarities and differences in materialism among 14- to 17-year olds in China, Japan and the USA. Significant differences were found between respondents from the three nations for materialism and discretionary spending power. Discretionary spending power had a significant effect on materialism across nations. In addition, evidence supports cross-national differences in the psychological structure of the materialism construct. While personal gain and social gain explain two materialism dimensions for the Japanese and American samples, factor analysis results suggest materialism may have alternative conceptual underpinnings in China. The findings of this study generally fail to support the global teenager hypothesis as it relates to the value of materialism.

Notes: Consumerism is part of living in the contemporary post-modern world. It is claimed that schools and consumer education have a rather marginal impact on the consumer behaviour of young people. This qualitative study explores adolescents’ ways of consuming in three different worlds: home, school and peer groups. The aim is to understand how the adolescents experience border crossings between these worlds. What do they think about consumerism and consumer education? Finally, the pedagogical challenges of consumer education are discussed. The qualitative data was collected through mind maps, written questionnaires and semi-structured group interviews. Qualitative content analysis was used to analyse the data. The data was collected from 59 teens (between 14 and 15 years of age) from Vantaa, Finland. According to the results, the adolescents’ way of consuming in each world differs from each other. However, border crossings occur with natural strategies and smooth transitions. The adolescents feel that ‘real’ consumerism does not begin until adulthood. Then, it is time to act like responsible consumers. Their motivation to study consumer issues at school is poor, because they feel the substance of consumer education not corresponding to their lives. Because of this, consumer education needs pedagogical renovation based on the needs of the adolescents and the special features of their consumerism.

Notes: This article examines how young Finns represent their consumer identity through narratives. Young consumers are easily seen as careless spenders and selfish hedonists in the contemporary consumer society. However, an empirical approach is required in order to find out whether this generation of young Finnish consumers is one of ‘raving hedonists’ or ‘ultimate materialists’, as their peers are often presented in public discussion in many western societies. The empirical data was collected in five upper secondary schools between the end of November 2001 and the beginning of January 2002. These schools are located in five different districts in Finland, varying from metropolitan to rural areas. The study focused on students aged 16–19 years and used essay writing as the method for collecting qualitative data. The data thus consists of 159 life stories as a consumer written by young Finnish people. Qualitative research methods, such as narrative analysis, were used in this study. It is argued that Finnish young people are representing their identities as consumers through a combination of various levels of consumer discourses besides hedonism and squandering: rationality and economizing are an essential part of their consumer identities. Some youngsters also present themselves as responsible consumers including ecological and ethical choices as part of their narrative. The way these youngsters combine discourses gives evidence of the various features of the present-day young consumer. It is also suggested that their consumer identity develops and changes with age. Young people describe their identity changing through a hedonist/squanderer discourse to a rational and economical one or vice versa. They also combine hedonist, rational, economical and responsible discourses simultaneously.

Notes: Product safety is related to consumer/user competence. Pharmaceutical products usually have high associated risks that can be compounded by irregular consumption practices. Of particular concern are older people who, due to a variety of reasons, cannot comply with pharmacy instructions. Medication compliance for this group often depends on co-ordinating the efforts of formal and informal carers. Failure to co-ordinate can lead to both serious medical consequences and litigation against carers.Based on the experiences of an action research project, the paper initially details the substantive issues within a product/service-delivery framework. The roles of agents and surrogate shoppers are noted. The wider regulatory and legal context is then explored with reference to the pharmaceutical industry and health and social care providers. These local and global considerations give rise to a discussion of the applicability of existing theoretical approaches to the problem of ensuring the timely and accurate administration of medication for vulnerable older people. In formulating the specifications of service re-design using complexity and network theories, the continued relevance of traditional (e.g. 4Ps/7Ps) and current (e.g. relationship) marketing paradigms is demonstrated. In conclusion, the paper highlights the need to balance risks, rights and responsibilities in cases where strict forms of empowerment are inappropriate.

Notes: Consumers are essentially decision-makers, with a strong influence in the product chain. Establishing sustainable global resource systems, across developed and developing nations, is dependent on finding ways to encourage consumers to prioritise environmental issues as one of the key determinants of their consumption decisions. More than this, all stakeholders in the product chain must become aware of their impacts on the psychological, social, cultural, physical and economic environments that predispose consumers to certain approaches when making consumption decisions.Conventional science has not provided the solutions for several reasons. Pure science and technology have developed according to different agendas and interests. Science has generally not been communicated in ways that allow consumers to make day-to-day decisions, fully informed of the implications. The barriers to genuine interdisciplinary research required to generate socially relevant solutions to the complex problems associated with traditional consumption patterns are only now being slowly overcome.Due to its interdisciplinary and integrated nature, consumer science provides a theoretical platform from which to formulate the core questions, articulated within a framework in which all stakeholders can contribute in synergistic ways to reverse the escalating rates of resource depletion, disparities of resources between groups, loss of species and pervasive pollution. There is no other discipline which offers an encompassing and integrated framework for the responsible communication of science necessary to describe the problems. Most importantly, consumer science has the capacity to research and interpret individual and social behaviour in ways which lead to innovative and effective controls to improve and sustain new standards for living on this vulnerable plant.

Notes: A recent application of biotechnology to food is genetic modification. Genetically modified (GM) plants, animals and processed foods have been introduced to the international marketplace in the 1990s. As scientific and technological progress in modern biotechnology continues at a breakthrough pace, the consumers are presented with different types and levels of information that is potentially relevant for making choices.Findings from studies of consumer attitudes and awareness towards GM products have varied greatly. Many studies, however, have indicated that public opinions about GM products are not fully formed and the task of informing the public is far from over. This study expands on previous research by examining the factors that influence the search for information about GM products. Utilizing the theory of consumer behaviour and information search, we analyse consumers’ information search patterns about GM products. Specifically, we estimate the probability that consumers search for information actively, passively or do not search for information at all, and the factors influencing this search.An ordered probit model is formulated to measure the factors, both economic and behavioural, that influence in-formation search by consumers for GM products. Variables representing the informational attitudes and behaviour related to GM products have the greatest impact on the probability of searching for information about GM products. With the exception of age, demographic factors are not significant. The results point to information search, not, for the genetically modified characteristic, but instead for the absence of the characteristic.

Notes: Patients’ use of health-related information from the Internet is increasing at an exponential rate. Although we have some information about how health professionals use the Internet (Roscoe, 1998; Wilson, 1999) we know little about how patients utilise this information. Some patients may actively seek information to assume more responsibility for their health. However, others may feel forced into doing so because of failing confidence in health care provision. Health professionals have the potential to assist patients to make sense of health information from the Internet; however, they may not necessarily welcome this role (Wilson, 1999; Eberhart-Phillips et al., 2000). This study aims to evaluate patient use of such information in primary care and to establish how this can be directed in the future.851 adult patients from general practice were surveyed about the health information they use, including the Internet. 50 patients from     the     survey     were     then     randomly     selected     for     interview. 12     health     care     professionals     were     also     interviewed     about how patients use the Internet and the impact this has on consultations.The majority of patients (80%) prefer to use their GP as a source of health information. The remaining sources of information received significantly lower ratings. However, the Internet was the second most preferred source of information (7%).Of those using the Internet about two thirds felt more prepared and able to participate in decision-making about treatments.The majority of patients rely on their doctor for health information. However, many patients actively use the Internet as an information source. The use of Internet information during consultations is on the increase, and although patients are positive about such use, doctors do not necessarily welcome Internet informed patients. It is now necessary to identify the training needs of health care professionals for dealing appropriately with Internet informed patients.

Notes: Huge strides in technological development combined with marketing strategies have led to dramatic changes in the way information is transmitted and communicated to the consumers, and subsequently used by the consumers. Information has become a dominant factor in determining why, where, what, and how consumers shop, process information, and make decisions. While marketing information has always been an important factor in consumer decision-making, its provision on demand and added convenience via the Internet has created a need to research the nature and amount of information that these technologies provide.Advertisements use different forms of persuasion to gain consumer attention, meet their economic and emotional shopping needs, to create a positive image of the product, brand, and the shopping medium, and influence consumers to purchase the product. Persuasion may be classified as functional congruity and self-congruity routes to persuasion (Johar & Sirgy, 1991). Fifty websites were studied for utilitarian and value-expressive forms of persuasion by product differentiation. The websites were classified as those selling tangible products only and those selling intangible products only, and those selling both tangible and intangible products. The paper will present results of the study along with a discussion and conclusion with implications on consumer well-being.

Notes: Children and youth are a dominant consumer force in the media marketplace and restricted media content is part of the near environment of many adolescents, both at home and in their communities. Yet, little attention has been paid to adolescents as consumers of film, video, DVD, Internet, video games, pay per view, satellite and digital cable television content that has been deemed ‘adult’ or restricted content by government and industry regulators. Using a human ecology framework, this research assess what types of restricted media content 13 and 14 years olds are exposed to at home and in the community, how they come to have access to different types of restricted material, how they regulate their own consumption of sexually and violently explicit media content, what they think is appropriate viewing for themselves.The media environment of adolescents is continually changing with the proliferation of new technologies, and restricted content is pervasively and aggressively marketed to adolescents. Market forces, government regulation, parental guidance, and media in its social context determine what children are exposed to. This research investigates the interaction between these forces and their outcomes for adolescents in the province of Alberta, Canada. Adolescents in Alberta have the highest rates of film, video, and DVD viewing in Canada, as well as the highest saturation of Internet in homes. Alberta's system of film classification (age restrictions   on   film,   video,   and   DVD)   is   similar   to   that   of most EU countries, providing a context for international comparison.Findings from this research are critical to policy makers, regulatory bodies, media producers, educators, and parents in establishing practices to protect and educate young consumers. Information about Alberta adolescents’ consumption of restricted media content and how they gain access to it will ultimately affect children and youth by informing the societal forces which govern their media use.

Notes: Advertisers use social marketing to inform and convince consumers of the available products. The most casual apparel like jeans also comes in several brands ranging from designer names with status appeal to economical choices. Labels and hangtags serve as the first connection between the consumers and the apparel product. They address both intrinsic and extrinsic traits. Consumers use labels for social identification, information acquisition and care instructions. The threefold purpose of the reported study was (1) to determine the compliance of the information on the labels of men's jeans with the federal requirements of permanent care labelling; (2) to examine the content and significance of information on the hangtags; and (3) to determine if the weight/unit of the men's jeans varied across various brands used for the study.A content analysis of the information on the labels and hangtags of 26 men's jeans was conducted. The information was tabulated and examined for compliance with federal regulations as well as additional information provided to convince the consumer of the products’ authenticity and performance for the intended use.The findings revealed that labels and hangtags had useful information for persuading the consumer of the longevity of the company and authenticity of the product. The analysed jeans varied for price, style, and weight to meet the satisfaction of a broad spectrum of consumers who could be price conscious, status-driven, and/or just information-seekers. The results support the role of social marketing in reaching a variety of consumers by offering choices. This work can be further extended to determine the impact of labels and hangtags on decision-making across various consumer markets for jeans as well as other apparel categories.

Notes: Genetically modified organisms (GMOs) were first used to designate micro organisms that had had genes from other species transferred into their genetic material by the then-new techniques of ‘gene-splicing.’ Cultivation of GMOs has so far been most widespread in the production of soybeans and maize. The United States holds almost three-fourths of the total crop area devoted to GMOs. Because many crops have been imported from the US, there is a large possibility for consumers to intake the products of GMOs in Korea. The safety of GMOs is not scientifically settled at this time, however. Additionally, the research regarding the GMOs issue of consumers has rarely been conducted in Korea. This study therefore focused on the consumer attitudes about GMOs and willingness to purchase them. The data were collected from 506 adults living in Seoul, Daegu and Busan, Korea, by means of a self-administered questionnaire. Frequencies and chi-square tests were conducted by SPSS. The results of the survey were as follows. First, the consumer concerns about GMOs were high but recognition was low; many respondents answered they did not have exact information about GMOs, although they had heard about them. Second, almost 93% of the respondents desired the labelling of GMOs. Third, the level of acceptance of GMOs was high; two-thirds of the respondents showed that they were willing to buy GMOs. Finally, many respondents worried about the safety of GMOs in that 73% of the respondents primarily wanted to be informed about safety of GMOs. This study suggests that the consumer education about GMOs should be conducted through mass media and consumer protection organisations.

Notes: This study investigated consumers’ awareness and information need about food hygiene especially focused on pesticide residues and food borne illness in Korea. The data were collected from 350 adults living in Daegu and Busan, Korea by a self-administered questionnaire. Frequency and chi-square tests were conducted by SPSS. The results of the survey were as follows: Firstly the consumers’ concerns about food hygiene were high. About three-fourths of the respondents answered that they were ‘somewhat’ or ‘highly’ concerned about pesticide residues and food borne illness. Especially women and the older showed more concerns than men and the younger. Secondly, the respondents worried about eating vegetables, fruits and grains in turn because of pesticide residues, and did not trust the results from food hygiene tests by the Government. Thirdly, three-fourths of the respondents used the way to wash food stuffs with water several times to clean pesticide residues. Fourth, about four-fifths of the subjects worried about food borne illness caused by fish to the extreme and about two-thirds answered that un-fresh or contaminated food stuffs were the major factor of food borne illness in cooking. Finally, the respondents primarily wanted to get the information about harmfulness of pesticide residues in foods, and methods to choose fresh food regarding food borne illness. Under the situation of the lack of educational programs for food hygiene in Korea, the educational contents for food hygiene to improve public health can be developed on the basis of this study.

Notes: Considering the large sums of money young people spend on goods and services and the huge importance marketers grant to them, it is easy to agree on the very important role they play in today's consumer society. Autonomous role enactment involves the attainment of a certain level of performance which implies certain socially desirable behaviours. However, studies about consumer skills are rather sparse. Consequently, we do not know if young people present the necessary abilities to make educated choices, protecting their own interests and exerting their responsibilities as citizens in the community and by this, contributing to balancing the market forces. The data presented are an extract from the qualitative part of a larger study about the consumer skills of French Canadian college students. Thirteen students, aged from 18 to 22 years old, were recruited in three colleges of the Quebec City area through personal contacts with academic members. They participated in semistructured interviews during the months of November and December 2001. During the discussions, they expressed their perceptions of the skills necessary for being an educated consumer, their own level of competence in this area, the general level of competence of people of their age and that of older adults. They identified the most significant agents in their consumer socialisation and detailed the nature and content of these influences. This information implements research in consumer behaviour from a non-commercial perspective and has helped to plan the quantitative stage of the study which is presently under way. The study is financed by the Social Sciences and Humanities Research Council of Canada.

Notes: This study sets out to investigate claims made by manufacturers regarding the medical benefits of some functional foods. A range of functional foods has come onto the market, providing the potential for customers to tailor their food choices more closely to their needs, providing they understand how to incorporate the appropriate products into their diet.Claims regarding beneficial effects include: prevention or reduced risk of a symptom or disease such as osteoporosis with those foods enriched with calcium, enhancement of the digestive system by using probiotic yoghurt drinks or the treatment of disease by introducing plant sterols to reduce LDL cholesterol and thus the risk of heart disease.Data were collected from the nutritional information provided by the manufacturers and analysed comparatively by contrasting the functional food with their ‘everyday’ alternative, which do not make any special claims.Results     show     that     in     the     majority     of     cases     the     actual claims     made     by     the     manufacturer     were     not     substantiated and actually proved misleading and deceptive. It was considered that most products were over-rated with regard to price and function.The work concludes that whilst functional foods are now established on the market in many cases the claims are not substantiated and in some cases products have been withdrawn.

Notes: Recent subject benchmarking statements by the Quality Assurance Agency for Higher Education (2002) have included the subject of consumer sciences at bachelor's level. This is significant in that part of the aim of subject benchmark statements is to describe the nature and characteristics of specific degree level subject areas and to identify the ‘typical substantive core’.Consumer science/studies have therefore been defined as: ‘interdisciplinary subjects which seek to understand the relationships between the consumer and the economic, technical, social and environmental forces which influence the development and consumption of goods and services’ (QAA, 2002).If we are seeking, therefore, to encourage empowered consumers, we need to have an understanding of how the context of consumption and consumerism is positioned within current course structures. During the last five years developments and change in both the subject area and courses has made it increasingly necessary to explore the boundaries and development of degree level courses in the subject area in the United Kingdom.Research is therefore being undertaken to investigate the existence of a unique body of knowledge that currently defines the subject field, given its inter and multidisciplinary focus.This research has also aimed to track the changes and developments in courses and to map the forms of knowledge within the subject field between higher education institutions. This has been undertaken by comparing original studies of degree content areas, interviews and surveys of core academic staff and undertaking a recent follow up of this work. The results of this research will be available for presentation at the conference.

Notes: In order to assess the influence of social desirability in a food frequency questionnaire (FFQ), 483 Portuguese university students (133 women and 350 men) were recruited to a two-part self-administered questionnaire: the first part included the Marlowe–Crowne Social Desirability Scale (M-CSDS), physical activity data and self-reported height and weight; the second part, a validated semiquantitative FFQ. All subjects completed the first part of the questionnaire but only 40.2% returned the FFQ fairly completed (no statistically significant differences were found between the two groups, for any of the variables studied). Statistical analysis included reliability and test–retest of M-CSDS, correlation and general linear model (GLM).The Cronbach's alpha of M-CSDS was 0.64 and a test–retest correlation of 0.80 was obtained in a subsample of 35 subjects who completed the scale twice. We found a significantly positive correlation between social desirability and vitamin E for women; when adjusted for physical activity, body mass index and energy, social desirability was positively correlated with vitamin E, magnesium and fibre for women; and vitamin C, magnesium and fibre, for men. In GLM, social desirability produced a significant upward bias in dietary fibre, sugars, β-carotene, vitamins C, E, magnesium, potassium and iodine, for women; and in dietary fibre, pufa n-3, folate, vitamins C, E, magnesium, manganese and potassium, for men.In GLM, and for both genders, social desirability produced a significant upward bias in vegetable consumption. Moreover, social desirability produced for women a significant downward bias in white bread, onion and beer, and for men in biscuits.

Notes: The aim of this presentation is to introduce some new frameworks that have been under discussion in developing university studies in the field of home economics or family and consumer sciences in Finland. The empirical data is derived from students’ contributions during their university studies in the degree program for home economics teachers at the Master's level. The main data is based on students’ opinions and conceptions about strengths (S), weaknesses (W), opportunities (O) and threats (T) of their university discipline and field to meet the future challenges. All students are at the level of advanced studies (mainly 4th year), and the number of students is 34. All have some school experience as a home economics teacher and most also have some other work experience in the field of home economics, family and consumer sciences.The research questions were: (1) How do the students see their field according to the SWOT analysis? and (2) What type of developments do they pose for the future? There was also an implementation section. Students were asked to produce their own ‘action plan’ for the next few years.The preliminary data analysis reveals that inside the discipline and the field there are several empowerment elements, but also that they are not used as efficiently as they could be.In conclusion, most students have a very realistic view of their studies. They can analyse them in diverse ways, and reveal important qualifications. They are aware of the various challenges that face us in both the present and future societies. Students also see that home economics not only gives them tools that are relevant in present school situations, but the subject includes such future potentials that can be used in directing the school towards the more open learning environments. Home economics has its place inside the education system. Both the idea of ‘home economics teacher as a researcher’ and ‘home economics teacher as an educator’ were seen as important aims to maintain in the university degree.

Notes: At a time when the major dialogue in food labelling is directed towards the volume and type of information presented, it is important to understand whether adolescents leaving education have the abilities to comprehend and use the current label as they represent the next generation of consumers.Legislation has been created to protect consumers and to enable them to make informed food choices. Food labels carry a significant volume of mandatory and voluntary information, designed to fulfil a variety of commercial and consumer functions. For these laws to be effective at an individual level, it is important that information is framed correctly, and that people can manipulate the data in an accurate and meaningful manner.In order to optimise food label information consumers require some competence across three different conceptual dimensions: maths, English comprehension, and health and nutrition. Most individuals acquire such skills at school.The pilot research that this paper describes investigates changes in   the   abilities   to   frame,   comprehend   and   manipulate label information, of 19 schoolchildren at one secondary school in Scotland. The main research, to be conducted in 2003, will include over a thousand children from another seven Scottish schools.Statistical analysis indicates that there is a significant improvement in the dimensions of both maths and English comprehension between levels S1 and S5, whilst the health and nutrition dimension does not show such significance.Each dimension has been measured against attitudes towards the use of labels in shopping and cooking to determine if the differences between those who use labels and those who do not are significantThe research also proposes a new method of presenting nutrition information to make it more meaningful to individuals across a wide spectrum of competence by reducing the number of conceptual components required to comprehend it.

Notes: Perception of country of origin and purchasing habits for beef were examined for urban and rural Scottish consumers. Origin was identified as being as important as intrinsic quality cues of colour and leanness, with rural consumers giving more weight to origin than urban ones. Most consumers interpreted ‘Scotch Beef’ and ‘British Meat’ label logos as evidence that the beef animals were ‘born, raised and slaughtered in Scotland or Britain’ respectively. The logos were taken as indicators of quality and safety. Both urban and rural respondents had higher agreement levels with Scotch beef as a safer, higher quality and more expensive commodity than British meat. Rural consumers made more use of butcher shops for purchase, but both groups sought butcher beef for quality reasons and supermarket sources because of convenience.