title: Regime-dependent output convergence in Latin America

authors: Holmes, Mark J.

subjects: economics

abstract: This paper tests for long-run output convergence between a sample of eight Latin American countries and over the study period 1900-2203. The key contribution of this paper is in terms of the econometric methodology where non-stationarity of log real per capita income differentials is tested within a Markov regime-switching framework. In contrast to existing studies, this paper defines two new concepts of output convergence where one allows for the possibility that output differentials behaviour either switches between stationary and non-stationary regimes (partial convergence), or switches between stationary regimes characterised by differing degrees of persistence (varied convergence). Whereas standard univariate and panel data unit root testing clearly suggest that output differentials are non-stationary, employment of the regime-switching methodology indicates that most of the sample is characterised by the existence of two distinct stationary regimes. Furthermore, it is argued that the often-cited convergence rate of two per cent per annum is likely to be an underestimate.

text: Regime-dependent output convergence in Latin America This paper tests for long-run output convergence between a sample of eight Latin American countries and over the study period 1900-2203. The key contribution of this paper is in terms of the econometric methodology where non-stationarity of log real per capita income differentials is tested within a Markov regime-switching framework. In contrast to existing studies, this paper defines two new concepts of output convergence where one allows for the possibility that output differentials behaviour either switches between stationary and non-stationary regimes (partial convergence), or switches between stationary regimes characterised by differing degrees of persistence (varied convergence). Whereas standard univariate and panel data unit root testing clearly suggest that output differentials are non-stationary, employment of the regime-switching methodology indicates that most of the sample is characterised by the existence of two distinct stationary regimes. Furthermore, it is argued that the often-cited convergence rate of two per cent per annum is likely to be an underestimate.

year: 2006

title: Emotions and their impact on investor behaviour

authors: Khan, Ahmed

subjects: Emotions

abstract: Decision-making is often considered to be a rational and cognitive process; however, recent literature shows that human emotions play a very important role in the decision-making process. Despite the overwhelming evidence from the psychology literature, there has been little recognition and consideration for the role of human emotions in financial decision-making. In order to cover this research gap, our study examines the relationship between emotions proxied by the news and social media and the decision-making process of investors. The 10 different emotions that we evaluate are calculated on an ongoing basis by applying advanced algorithms which scan listings on the news and social news media. Our sample consists of firms listed on the S&P500 and covers the 20 years from 1998 to 2017.  We recognise that there are two channels through which emotions impact on market valuations: one being a direct impact and the other being an indirect path through which emotions condition how investors respond to information signals. 
The first empirical chapter of the study investigates the impact of emotions on investor behaviour at the time of the earnings announcement. We find that Aggregate_Emotion, the aggregate across our individual emotions, has a significant impact on the decision-making of investors, as does the aggregate of both the positive and negative emotions considered. Our findings concerning individual emotions are mixed: while optimism and joy, and stress and gloom all impact on investor decision, anger and fear prove to be emotions that have little or no impact on investor behaviour. We also consider the relative impact of the two media sources, and we reveal mixed findings. For example, with social media, we find the greatest influence with respect to love/hate, whereas, for the news media we see a greater influence in the case of trust. 
The second chapter studies the impact of emotions during the post-earnings announcement drift (PEAD). PEAD is one of the longest surviving anomalies that challenge the efficient market hypothesis. While several studies have identified factors such as liquidity risk, arbitrage risk, and unsophisticated investors etc. that cause PEAD to persist, our results show that human emotions are yet another factor that plays a role in explaining the existence of this long-standing anomaly. Our results suggest that the drift can be explained by both the level of emotions at the time of the announcement but even more so by the direction of the level of emotions during the post-announcement period. All the individual positive emotions contribute towards how the investors value stocks over the post-announcement period, whereas the results for individual negative emotions are a bit weaker when compared to positive emotions. 
Finally, in the third empirical chapter, the focus is on identifying whether it is possible to use available information on human emotions to identify and exploit mispricing in stock pricing. Using the insights from the first two empirical chapters, we develop a two-part strategy that invests in the firms on the basis of aggregate positive and negative emotions. The first part of the strategy involves going long(short) when there is an exceedingly positive(negative) earnings announcement, and the positive(negative) emotions are in the bottom quartile before the earnings announcement. In the second part, we reverse the trade when the emotion either increases by a pre-specified amount or we reach the end of a pre-specified period. Our investment strategy(ies) produces significant positive returns, even after we take account of trading costs and factor exposures.
Efficient Market Hypothesis (EMH) argues that in a well-functioning financial market, new information gets instantly reflected in the stock prices. Our results are at odds with EMH and show that emotions can cause underreaction at the time of the release of new information. Furthermore, we also show that there is no automatic correction of the stock prices in the post-announcement period as the direction of the stock valuations is influenced by the direction that emotion takes in the post-announcement period. Overall, the results of our studies show that emotions play a significant role in impacting the decision-making process of investors and shaping stock prices.

text: Emotions and their impact on investor behaviour Decision-making is often considered to be a rational and cognitive process; however, recent literature shows that human emotions play a very important role in the decision-making process. Despite the overwhelming evidence from the psychology literature, there has been little recognition and consideration for the role of human emotions in financial decision-making. In order to cover this research gap, our study examines the relationship between emotions proxied by the news and social media and the decision-making process of investors. The 10 different emotions that we evaluate are calculated on an ongoing basis by applying advanced algorithms which scan listings on the news and social news media. Our sample consists of firms listed on the S&P500 and covers the 20 years from 1998 to 2017.  We recognise that there are two channels through which emotions impact on market valuations: one being a direct impact and the other being an indirect path through which emotions condition how investors respond to information signals. 
The first empirical chapter of the study investigates the impact of emotions on investor behaviour at the time of the earnings announcement. We find that Aggregate_Emotion, the aggregate across our individual emotions, has a significant impact on the decision-making of investors, as does the aggregate of both the positive and negative emotions considered. Our findings concerning individual emotions are mixed: while optimism and joy, and stress and gloom all impact on investor decision, anger and fear prove to be emotions that have little or no impact on investor behaviour. We also consider the relative impact of the two media sources, and we reveal mixed findings. For example, with social media, we find the greatest influence with respect to love/hate, whereas, for the news media we see a greater influence in the case of trust. 
The second chapter studies the impact of emotions during the post-earnings announcement drift (PEAD). PEAD is one of the longest surviving anomalies that challenge the efficient market hypothesis. While several studies have identified factors such as liquidity risk, arbitrage risk, and unsophisticated investors etc. that cause PEAD to persist, our results show that human emotions are yet another factor that plays a role in explaining the existence of this long-standing anomaly. Our results suggest that the drift can be explained by both the level of emotions at the time of the announcement but even more so by the direction of the level of emotions during the post-announcement period. All the individual positive emotions contribute towards how the investors value stocks over the post-announcement period, whereas the results for individual negative emotions are a bit weaker when compared to positive emotions. 
Finally, in the third empirical chapter, the focus is on identifying whether it is possible to use available information on human emotions to identify and exploit mispricing in stock pricing. Using the insights from the first two empirical chapters, we develop a two-part strategy that invests in the firms on the basis of aggregate positive and negative emotions. The first part of the strategy involves going long(short) when there is an exceedingly positive(negative) earnings announcement, and the positive(negative) emotions are in the bottom quartile before the earnings announcement. In the second part, we reverse the trade when the emotion either increases by a pre-specified amount or we reach the end of a pre-specified period. Our investment strategy(ies) produces significant positive returns, even after we take account of trading costs and factor exposures.
Efficient Market Hypothesis (EMH) argues that in a well-functioning financial market, new information gets instantly reflected in the stock prices. Our results are at odds with EMH and show that emotions can cause underreaction at the time of the release of new information. Furthermore, we also show that there is no automatic correction of the stock prices in the post-announcement period as the direction of the stock valuations is influenced by the direction that emotion takes in the post-announcement period. Overall, the results of our studies show that emotions play a significant role in impacting the decision-making process of investors and shaping stock prices.

year: 2022

title: Mauri oho, mauri tu, mauri ora: Enhancing Maori health and wellbeing through a critical engagement with social marketing

authors: Ellis, Riri Te Whara

abstract: This PhD research originally explored the efficacy of social marketing as potentially beneficial for Maori health providers involved with Maori health promotion activities. However, as I became conscientised to the potentially assimilist and neocolortial impacts .of functional management disciplines, such as social marketing I turned my attention as a Kaupapa Maori researcher to the task of critique and transformative social action. I also became acutely aware that the future of Maori health advancement lies in the flourishing of Te Ao Maori - a flourishing deemed necessary for the wellbeing of the people and the natural environment .in which Maori live is presented in this thesis. Te Ao Maori is therefore repositioned as a way in which to conceptualise Maori health and wellbeing, based upon holistic and cultural principles of living. 
Based on the transformative aspirations of critical theorists and emerging theories of kaupapa Maori, I incorporate the holistic constructs of Te Ao Maori while minimising the impact of the externally imposed mechanistic and functional metaphors dominating the contemporary formulation of human wellbeing. Using a localised participative methodology called Kaupapa Maori, I have worked collaboratively with four Maori groups and various kaiarahi hauora in Tauranga Moana to examine and articulate a series of collective responses to research issues. As a result of this research, my findings indicate that Maori continue to articulate a desire to live by principles and practices espoused through holistic models of Maori health and wellbeing, nestled into Te Ao Maori. That vision however is affected by continual structural change, limited resources, lack of access to skilled people, the imposition of contractual regulations within the health system, the erosion of Maori cultural systems and the ongoing commodification of Maori health and wellbeing in concert with the principles of market driven economies driving much human activity globally. The experience of Maori in Aotearoa New Zealand is the localised manifestation of the experiences of indigenous people across the globe. We share with them a position of resistance to the values of others and the affirmation of our own values. 
The potential of social marketing to contribute to enhancing Maori health and wellbeing was critiqued within these lived experiences, not those defined by social marketers themselves. In the control of uncritical social marketers, social marketing models are one of many conceptual frameworks that are being used to intensify economic rationality associated with the contemporary form of capitalism and the exacerbation of resource scarcity sanctioned by the existing health services system. Many of the co-participants in this research sought to provide health services and programmes that resembled and encouraged strong Maori cultural practices based upon tikanga Maori that emphasises a commitment to Whanau, Hapu and Iwi. However, the current health system does not help these goals to flourish. Instead, proponents of the system endorsed a regime of health services that operated within the specific constraints of contractual agreements - agreements which require responsibility for outcomes and accountability protocols that consume many resources better spent elsewhere. The opportunity then to engage in the enrichment of Maori health and wellbeing, through a holistic means was reported by participants in this research to be often undermined, minimised and sometimes made impossible. 
This research demonstrates that Maori efforts to enhance Maori health development are negatively impacted upon by an ongoing commercialisation and commodification of health services. Ongoing efforts _must be made to reinvigorate with and within Maori, an enduring commitment to a foundation of holistic health and wellbeing in the future, stemming from our own worldview - Te Ao Maori. The critical and Kaupapa Maori theories that inform this thesis have been used to bring into the open the contradictions and paradoxes Maori health providers in the Tauranga region are facing. The transformational aspirations of these theories would invite attention to be paid to values underpinning Maori communities and the ways in which they are useful to them. As reported upon in this research, those Maori health advocates adopting social marketing will find it difficult to achieve these aspirations. Instead, the assimilist modem colonising practices inherent in social marketing would tum Maori adopters into self colonisers.

text: Mauri oho, mauri tu, mauri ora: Enhancing Maori health and wellbeing through a critical engagement with social marketing This PhD research originally explored the efficacy of social marketing as potentially beneficial for Maori health providers involved with Maori health promotion activities. However, as I became conscientised to the potentially assimilist and neocolortial impacts .of functional management disciplines, such as social marketing I turned my attention as a Kaupapa Maori researcher to the task of critique and transformative social action. I also became acutely aware that the future of Maori health advancement lies in the flourishing of Te Ao Maori - a flourishing deemed necessary for the wellbeing of the people and the natural environment .in which Maori live is presented in this thesis. Te Ao Maori is therefore repositioned as a way in which to conceptualise Maori health and wellbeing, based upon holistic and cultural principles of living. 
Based on the transformative aspirations of critical theorists and emerging theories of kaupapa Maori, I incorporate the holistic constructs of Te Ao Maori while minimising the impact of the externally imposed mechanistic and functional metaphors dominating the contemporary formulation of human wellbeing. Using a localised participative methodology called Kaupapa Maori, I have worked collaboratively with four Maori groups and various kaiarahi hauora in Tauranga Moana to examine and articulate a series of collective responses to research issues. As a result of this research, my findings indicate that Maori continue to articulate a desire to live by principles and practices espoused through holistic models of Maori health and wellbeing, nestled into Te Ao Maori. That vision however is affected by continual structural change, limited resources, lack of access to skilled people, the imposition of contractual regulations within the health system, the erosion of Maori cultural systems and the ongoing commodification of Maori health and wellbeing in concert with the principles of market driven economies driving much human activity globally. The experience of Maori in Aotearoa New Zealand is the localised manifestation of the experiences of indigenous people across the globe. We share with them a position of resistance to the values of others and the affirmation of our own values. 
The potential of social marketing to contribute to enhancing Maori health and wellbeing was critiqued within these lived experiences, not those defined by social marketers themselves. In the control of uncritical social marketers, social marketing models are one of many conceptual frameworks that are being used to intensify economic rationality associated with the contemporary form of capitalism and the exacerbation of resource scarcity sanctioned by the existing health services system. Many of the co-participants in this research sought to provide health services and programmes that resembled and encouraged strong Maori cultural practices based upon tikanga Maori that emphasises a commitment to Whanau, Hapu and Iwi. However, the current health system does not help these goals to flourish. Instead, proponents of the system endorsed a regime of health services that operated within the specific constraints of contractual agreements - agreements which require responsibility for outcomes and accountability protocols that consume many resources better spent elsewhere. The opportunity then to engage in the enrichment of Maori health and wellbeing, through a holistic means was reported by participants in this research to be often undermined, minimised and sometimes made impossible. 
This research demonstrates that Maori efforts to enhance Maori health development are negatively impacted upon by an ongoing commercialisation and commodification of health services. Ongoing efforts _must be made to reinvigorate with and within Maori, an enduring commitment to a foundation of holistic health and wellbeing in the future, stemming from our own worldview - Te Ao Maori. The critical and Kaupapa Maori theories that inform this thesis have been used to bring into the open the contradictions and paradoxes Maori health providers in the Tauranga region are facing. The transformational aspirations of these theories would invite attention to be paid to values underpinning Maori communities and the ways in which they are useful to them. As reported upon in this research, those Maori health advocates adopting social marketing will find it difficult to achieve these aspirations. Instead, the assimilist modem colonising practices inherent in social marketing would tum Maori adopters into self colonisers.

year: 2006