Sourcing decisions with uncertain time-dependent supply from an unreliable supplier

Recently, an increasing number of companies have encountered random production disruptions due to the COVID-19 pandemic. In this study, we investigate a two-stage supply chain in which a retailer can order products from a low-price ("cheap”) unreliable supplier (who may be subject to an uncertain production disruption and partially deliver the order) and an "expensive” reliable supplier at Stage 1 and a more "expensive” backup supplier at Stage 2. If the disruption happens, only the products that were produced before the disruption time can be obtained from the unreliable supplier. It is found that in the case with imperfect demand information updating, the unreliable supplier is always used while the reliable supplier can be abandoned. The time-dependent supply property of the unreliable supplier reduces the retailer's willingness of adopting the dual sourcing strategy at Stage 1, compared with the scenario with all-or-nothing supply. Different from the case with imperfect demand information updating, either the reliable or unreliable supplier can be abandoned in the case with perfect demand information updating. We derive the optimal ordering decisions and the conditions where single sourcing or dual sourcing is adopted at Stage 1. We conduct numerical experiments motivated by the sourcing problem of 3M Company in the US during the COVID-19 and observe that the unreliable supplier is more preferable when the demand uncertainty before or after the emergency order is higher. Interestingly, the retailer tends to order more from the unreliable supplier when the production disruption probability is larger in some cases. © 2022 The Author(s)

COVID-19 moderates the association between to-metro and by-metro accessibility and house prices

Previous studies extensively examined the role of accessibility to metro in shaping house prices but largely overlooked the contribution of accessibility by metro. In addition, limited studies examined the moderating effect of COVID-19 on the price effects of to-metro and by-metro accessibility. Based on multilevel hedonic price and quantile regression models, this study scrutinizes the association between to-metro accessibility, by-metro accessibility, and house prices in Chengdu, China, and examines the moderating role of COVID-19 in this association. We show that by-metro accessibility significantly influences house prices. COVID-19 significantly influences the value of to-metro accessibility but marginally affects that of by-metro accessibility. The value of to-metro accessibility is disproportionately affected by the pandemic. Specifically, small or low-priced houses are less affected than big or high-priced houses. In other words, the flattening of the to-metro price gradient is more discernible for big or high-priced houses. The changing preference of residents has also been verified by the decreases in house transaction volume in metro-adjacent areas. © 2022 Elsevier Ltd

Oil prices and the green bond market: Evidence from time-varying and quantile-varying aspects

This paper investigates the link between crude oil prices (COP) and green bonds through a rolling-window Granger-causality test. The positive, negative, and uncorrelated impacts of COP on the green bond index (GBI) are captured with the same sample. The positive effects show that the prosperity of the green bond market is promoted by the high COP, demonstrating that green bonds can avoid shocks from COP. Nevertheless, due to the high profits of the green energy industry and the excess supply on the oil market, the negative impact between COP and GBI is also found. These results are not completely consistent with the price correlation model between oil and green bonds. Furthermore, the positive impact of the GBI on COP shows that green bonds cannot moderate the oil crisis due to COVID-19, instability in the international political environment, and the immaturity of green bonds market. In addition, depending on the quantile Granger-causality test, only high COP affects the GBI, and this asymmetric feature is attributed to increasing production costs and environmental protection pressure. Understanding the nexus between COP and the GBI is of practical significance for bond issuers, regulators, and investors. © 2022 Borsa Ä°stanbul Anonim Åžirketi

Do emerging art market segments have their own price dynamics? Evidence from the Chinese art market

This study examines the nonlinear dynamics in the price series of Chinese art market segments between 2000 and 2019. We employ a hedonic price model to construct price indices of Chinese art market segments and analyze the nonlinearities and regime-switching properties of the individual segment using a series of Markov switching model specifications. We argue that occasional shocks would only temporarily alter their data-generating processes and have transitory effects. Moreover, we investigate the impact of COVID-19 on Chinese art market segments. Our findings have implications for market participants in identifying the price characteristics and dynamic behavior of art market segments. © 2022 The Author

Decision-making model to predict auto-rejection: An implementation of ARIMA for accurate forecasting of stock price volatility during the Covid-19

This study aims to determine an accurate forecasting model, especially an error rate of around 0, and to examine how the automatic rejection system reacts to stock price as a result of the pandemic. The statistical clustering method is used for the dataset in form of daily observations, while the sample covers the period of cases before and after COVID-19 pandemic from 02 January 2019 to 20 June 2020 at the Trinitan Minerals and Metal Company. Furthermore, the data used in the estimation are the opening and closing price of returns, which are later processed using SAS analysis tools. It is shown that the most appropriate decision-making processes are those proven to be most effective. Therefore, predicting future events based on a suitable time series model will help policymakers and strategists make decisions and develop appropriate strategic plans regarding the stock market. Meanwhile, 98% of the ARIMA (1,1,1) is a forecasting model which can be applied to predict stock prices. The new approach of this study is an integrated autoregressive moving average used as an attempt to accurately predict stock prices during a pandemic. © 2023 by the authors;licensee Growing Science, Canada.

Can the green bond market enter a new era under the fluctuation of oil price?

This paper investigates how oil price (OP) influences the prospects of green bonds by utilising the quantile-onquantile (QQ) method and researching the interactions between OP and green bond index (GBI) from 2011:M1 to 2021:M11. We find that impacts from OP on the GBI are positive in the short run. The positive effects indicate that high OP can promote the development of the green bond market, indicating that green bonds can be considered an asset to avoid OP shocks. However, in the medium and long term, there is a negative impact due to the oversupply of the oil market and the increase in green energy industry profits. These results are identical to the supply and demand-based correlation model of green bonds and oil price, which underlines a specific effect of OP on GBI. The GBI effect on OP is consistently positive across all quantiles. It indicates that green bonds cannot be considered efficient measures to alleviate the oil crisis due to the instability of the Middle East COVID-19 and the small scale of green bonds. The issuers of green bonds can make decisions based on OP. Understanding the relationship between OP and GBI is also beneficial for investors. © 2022 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.

Frequency connectedness and cross-quantile dependence among medicare, medicine prices and health-tech equity

We investigate the dynamic connectedness among health-tech equity and medicine prices (producer and consumer) and Medicare cost indices for the US market. In doing so, we apply Cross-Quantilogram Dynamic Connectedness based on Time-Varying Parameter Vector Autoregression (TVP-VAR) approaches to analyse historical high-frequency time-series data. TVP-VAR results show that health-tech equity is the highest volatility transmitter while Medicare price is the highest volatility receiver. We also find medicine producer price is the net volatility contributor while the retail price of medicine is the net volatility receiver. The Cross-Quantilogram analysis confirms a strong bivariate quantile dependence between respective markets at a higher quantile of each market. Cross-quantilogram demonstrates a higher level of connectedness among the markets when considering medium and long memory. We observe health-tech equity turned to be a profound volatility contributor, while medicine price (both producer and retail prices) and Medicare appeared to net volatility receiver during the time of COVID19 Pandemic. The financial performance of health-tech equity returns elevates the price volatility of medicine and eventually Medicare cost, which imply that equity return should be incorporated forming medicine prices. © 2022 Elsevier Ltd

Food retailer response to price gouging litigation

Price gouging laws are designed to protect consumers from skyrocketing prices, but are they beneficial in practice? In this research, we analyze food retailers' response to widespread price gouging litigation for table eggs at the onset of the COVID-19 pandemic. Our results suggest that price gouging litigation led to a dramatic change in US food retailer behavior, which persisted long after the resolution of many of these legal disputes. Major grocery retail chains responded to price gouging litigation by announcing price freezes on thousands of staple products. By rigidly adhering to pre-pandemic price levels for eggs, we find that retailer response led to a breakdown in the historic dynamic equilibrium relationship between egg prices and the costs of major inputs. At a time when the cost of egg production increased sharply, we find that retailers chose to reduce their purchases and price promotions for eggs rather than raise prices. This suggests that—in response to price gouging litigation—food retailers are willing to accept empty shelves in lieu of increasing prices. © 2023 Agricultural & Applied Economics Association.

The role of stock markets in the US, Europe, and China on oil prices before and after the COVID-19 announcement

This research investigates the asymmetric effects of the three major stock prices of the US, Europe, and China on WTI and Brent oil futures prices before and after the COVID-19 announcement by covering weekly data from January 2015 to April 2021. The results of the nonlinear autoregressive distributed lag (NARDL) model show that the US stock price has a significant positive effect in both models prior to the COVID-19 announcement but loses its effect on the WTI oil futures price after the COVID-19 announcement. Its impact on the Brent oil futures price remains after the COVID-19 announcement. The Europe stock price has a significant positive effect in all states. China stock price is not significant in the pre-COVID-19 period, but it has a significant effect after the COVID-19 announcement in both models. However, the only positive asymmetric changes in China stock price show a significant effect on the Brent oil futures price. Before COVID-19, the US stock price is the strongest, while the Europe stock price is the strongest after the COVID-19 announcement.

Inward-looking policies, finite change, and employment: The capital reallocation effect

It is well recognized that there emerged a trend of inward-looking trade policies even before the COVID pandemic crippled the world. These were reflected in both BREXIT and US-China trade conflicts. As countries become inward-oriented, usually local prices start rising. With this backdrop, this paper explores how rising local prices are likely to affect employment in the short and long runs when we accommodate for the finite change in a general equilibrium structure whereby sectors not only contract but might also close down altogether due to the capital reallocation effect following a price incentive. © 2022 International Association for Economic Theory.

Bubble contagion effect between the main precious metals

Purpose: This study examines the extent to which gold and silver bubbles are correlated and which metal's bubble spills over to the other. In addition, the overlap in bubble-like episodes for the two metals is demonstrated and the influence of crises (global financial crises, European debt crisis and the COVID-19 pandemic) on the development of these episodes is compared. Design/methodology/approach: This study proposes a two-step approach. In the first step, price bubbles are identified based on the backward sup augmented Dickey–Fuller of Phillips et al. (2015a, 2015b) and modified by Phillips and Shi (2018). In the second step, the correlation in the contagion effect of the bubbles between the two precious metal prices is measured using a nonparametric regression with a time-varying coefficient approach developed by Greenaway-McGrevy and Phillips (2016). Findings: The findings suggest that the safe-haven property of gold and silver during financial market turbulence induces excessive price increases beyond their fundamental values. Furthermore, the results indicate that bubbles are contagious among precious metal markets and flow mainly from gold to silver;these findings are associated with the period after 2005, particularly during the global financial crisis. A contagious bubble effect is not found between gold and silver during the coronavirus disease 2020 pandemic. Practical implications: The results suggest that financial market participants should consider portfolio weights in precious markets in light of the bubble correlation between gold and silver, especially during crises. Originality/value: To the best of the authors' knowledge, this is the first study that explores the correlation of bubble-like episodes between gold and silver. © 2022, Emerald Publishing Limited.

Pricing extreme mortality risk in the wake of the COVID-19 pandemic

In pricing extreme mortality risk, it is commonly assumed that interest rate and mortality rate are independent. However, the COVID-19 pandemic calls this assumption into question. In this paper, we employ a bivariate affine jump-diffusion model to describe the joint dynamics of interest rate and excess mortality, allowing for both correlated diffusions and joint jumps. Utilizing the latest U.S. mortality and interest rate data, we find a significant negative correlation between interest rate and excess mortality, and a much higher jump intensity when the pandemic experience is considered. Moreover, we construct a risk-neutral pricing measure that accounts for both diffusion and jump risk premia, and we solve for the market prices of risk based on mortality bond prices. Our results show that the pandemic experience can drastically change investors' perception of the mortality risk market in the post-pandemic era. © 2022 Elsevier B.V.

On the volatility of WTI crude oil prices: A time-varying approach with stochastic volatility

This study investigates the impacts of crude oil-market-specific fundamental factors and financial indicators on the realized volatility of West Texas Intermediate (WTI) crude oil price. A time-varying parameter vector autoregression model with stochastic volatility (TVP-VAR-SV) is applied to weekly data series spanning January 2008 to October 2021. It is found that the WTI oil price volatility responds positively to a shock in oil production, oil inventories, the US dollar index, and VIX but negatively to a shock in the US economic activity. The response to the EPU index was initially positive and then turned slightly negative before fading away. The VIX index has the most significant effect. Furthermore, the time-varying nature of the response of the WTI realized oil price volatility is evident. Extreme effects materialize during economic recessions and crises, especially during the COVID-19 pandemic. The findings can improve our understanding of the time-varying nature and determinants of WTI oil price volatility. © 2022

The impact of COVID-19 on agricultural market integration in Eastern Canada

Since the outbreak of the coronavirus pandemic in early 2020 and the resulting economic fallout, reports and official statistics have pointed to an unequivocal effect of the disease on almost all global economic activities, including the agricultural and agri-food sectors. The aim of this article is to use a price transmission approach in order to study the price relationships of agricultural commodities, including potatoes, corn, hogs, eggs, and chicken between regional Canadian markets and to verify their economic integration. The method of panel cointegration is applied to investigate the potential impact of the pandemic on the spatial integration of the provincial agricultural markets in Eastern Canada. It is found that these markets were fully integrated and efficient prior to COVID-19 restrictions. However, the statistical results show that travel restrictions and labor shortages represented trade barriers between the provinces, and they are likely the factors that impacted the price transmission mechanism, and consequently the markets became much less integrated. It is suggested that government policies should include actions that would manage future shocks to the agricultural commodity prices by accelerating the necessary transformations in the agri-food sector to make it more resilient and less vulnerable to future pandemics and other potential natural challenges.

The political economy of development in Belize under the People's United Party

The former British colony of Belize faces serious economic problems today, reflecting a collapse in tourism following COVID-19. To account for this fragility, a return to economic history is needed. We focus on two critical periods. First, we examine why the Belizean state was unable to form a developmental state in the period of the anticolonial movement and self-government (the 1950s–1960s). Particular attention is given to George Price, leader of the anti-colonial People's United Party (PUP) and ‘father of the country'. Second, turning to the post-colonial period, we examine one experimental chapter that lasted roughly a decade (1998–2007) when a coherent state-led economic strategy was pursued. During both periods the PUP-led state sought to reorganize development strategy along progressive lines, but failed to deliver. Because capital was almost completely foreign dominated, the fledgling Belizean developmental state could not discipline capital toward developmental alignment. © 2022 The Author(s). Co-published by Unisa Press and Informa UK Limited, trading as Taylor & Francis Group.

Hand Sanitizers' Consumer Purchase Decision-Adapted Model, Testing And Validation

The first thing the COVID-19 teaches the public is to keep your hands clean and safe. The demand for hand sanitizers has suddenly grown because using these products is one of the strategies to defend against COVID-19. Sanitizers and masks were classified "necessary goods" by the Indian government under the Essential Commodities Act. The government has set the price of a 200ml bottle of hand sanitizer at Rs.100/-. Furthermore, the Indian government set the price of sanitizers at 2ml for no more than Re.1/-.The objectives of the research study are to adapt the five-stage consumer decision making model (Kotler et al. (2009)) for the hand sanitizer product in the COVID-19 scenario and to adapt and define the scale items related to each stage of the consumer decision making process with regard to the hand sanitizer product. The findings indicate that consumers demonstrate regular purchasing behaviour when they are happy with an emergency product (hand sanitizer product in covid-19 scenario). Consumers will prefer to acquire emergency-related products solely from approved stores (like medical outlet).

Shipping costs and inflation

The Covid-19 pandemic has disrupted global supply chains, leading to shipment delays and soaring shipping costs. We study the impact of global shipping costs—measured by the Baltic Dry Index (BDI)—on domestic prices for a large panel of countries during the period 1992–2021. We find that spikes in the BDI are followed by sizable and statistically significant increases in import prices, PPI, headline, and core inflation, as well as inflation expectations. The impact is similar in magnitude but more persistent than for shocks to global oil and food prices. The effects are more muted in countries where imports make up a smaller share of domestic consumption, and those with inflation targeting regimes and better-anchored inflation expectations. The results are robust to several checks, including an instrumental variables approach in which changes in shipping costs are instrumented with an indicator of closures of the Suez Canal. © 2022

The determinants of crude oil prices: Evidence from ARDL and nonlinear ARDL approaches

This paper is an innovative attempt to empirically investigate the determinants of crude oil prices. The main objective is to distinguish between short-and long-term effects of some covariates on oil prices. The autoregressive distributed lag (ARDL) approach is applied to daily series spanning the period from January 2, 2003, to May 24, 2021, to analyze long-run relationships and short-run dynamics. The paper also focuses on the asymmetric effects of covariates and a nonlinear ARDL (NARDL) approach is used to explore this asymmetry. The use of an asymmetric error correction model with asymmetric cointegration provides new insights for examining the determinants of oil prices. All investigations of underlying oil price fluctuations are examined both before and in the COVID-19 pandemic. Our results, based on different econometric specifications, have key policy implications for policymakers both with and without COVID-19 potential considerations.

Efficiency of the financial markets during the COVID-19 crisis: Time-varying parameters of fractional stable dynamics

This paper investigates the impact of COVID-19 on financial markets. It focuses on the evolution of the market efficiency, using two efficiency indicators: the Hurst exponent and the memory parameter of a fractional Lévy-stable motion. The second approach combines, in the same model of dynamic, an alpha-stable distribution and a dependence structure between price returns. We provide a dynamic estimation method for the two efficiency indicators. This method introduces a free parameter, the discount factor, which we select so as to get the best alpha-stable density forecasts for observed price returns. The application to stock indices during the COVID-19 crisis shows a strong loss of efficiency for US indices. On the opposite, Asian and Australian indices seem less affected and the inefficiency of these markets during the COVID-19 crisis is even questionable. © 2022 Elsevier B.V.

Macroeconomic production function of Russia and estimation of the marginal rate of technical substitution in the unprecedented socio-economic realities of 2020-2022

In the period 2020-2022 the Russian economy has been facing the new, unprecedented challenges of coronavirus and sanctions. In order to analyze the current state of affairs, we are offering an econometric study of Russia's macroeconomic production function for 1990-2022 and an estimation of the marginal rate of technical substitution under internal and external restrictions associated with the spread of the Wuhan coronavirus (SARS-CoV-2) and the conduct of Russia's special military operation in Ukraine, accompanied by increased sanctions pressure on the Russian economy. We have obtained several significant results. In the years 1991-1996 the marginal rate of technical substitution was increasing, and in 1997-2020 it was decreasing except for 2008-2009 and 2015. In the context of the Wuhan coronavirus pandemic, the main reasons for the Russian economy's decline in 2020 and growth in 2021 were, first of all, fluctuations in the world crude oil price, and not the Wuhan coronavirus pandemic as such. We did not find any evidence that the decline in the world crude oil price in 2020 was caused by a decrease in demand from China, since Russian oil exports to China increased. Contrary to many negative forecasts, the results of our forecasting of Russia's GDP for 2022 show that under sharply increased sanctions pressure, with the world price of Urals oil at $60 per barrel, the average growth rate will be 0%, while at $70 it will be 4%, and at $80 it will be 7%. Under the reduced demand for Russian gas and the shutdown of the Nord Stream 1 gas pipeline, the forecast volumes of gross natural gas production by Gazprom (excluding Gazprom Neft) in the Tyumen Region for 2022, based on the exponential production function studied by econometric methods, range from 364 to 392 billion cubic meters. Using the example of Great Britain, where in 2021 the average actual export prices for Russian oil and gas were the lowest compared to other Western European countries, we discuss the economic inexpediency of setting marginal prices for Russian energy products by Western consumers.