Bedri Kamil Onur Tas

The influence of internet customer reviews on the online sales and prices in hotel industry

In this paper, the impact of two service quality metrics (star rating and customer rating) on hotel room sales and prices is investigated. Two of the most popular tourist destinations in the world, Paris and London, are chosen. It is found that a higher customer rating significantly increases the online sales of hotels. The study results show that a 1% increase in online customer rating increases Sales per Room up to 2.68% in Paris and up to 2.62% in London. Contrary to expectations, higher stars do not increase the sales. It is also shown that higher customer ratings result in higher prices of the hotel and the prices of high star hotels are more sensitive to online customer ratings.

Inflation Targeting and Inflation Uncertainty

This article empirically investigates the impact of inflation targeting on inflation uncertainty. We implement PARCH and GARCH methodologies to model conditional variance of inflation. We also investigate the relationship between level and volatility of inflation to analyze the validity of the Friedman hypothesis for IT countries. We find that most of the inflation targeting countries have significantly lower inflation variances after inflation targeting. In most of the IT countries, the relationship is consistent with the Friedman hypothesis.

Private information of the Fed and predictability of stock returns

This article investigates whether the Federal Reserves (Feds) private Gross Domestic Product (GDP) growth forecasts, as reported in the Greenbook of the Fed, contain information about future real and excess stock returns. I implement long-horizon regressions to analyse the predictive power of the Feds GDP growth forecasts. The regressions conclude that the Feds GDP growth forecasts can be used to predict long- and short-term stock returns. The size of the coefficient of the Feds orthogonal GDP growth forecast indicates that 1% increase in the Feds forecast predicts 2–4% decrease in real and excess stock returns. The regressions considering the size effect suggest that the predictive power of the Feds GDP growth forecasts increases as the size of the portfolio decreases. A comparison of the Feds forecasts and the commercial forecasts shows that the Feds GDP growth forecasts contain information that does not exist in the commercial forecasts. I investigate the sources of the Feds superior private information and predictive power. Analysis suggests that the source of the predictive power of the Feds GDP growth forecasts is the private information about future surprise monetary policy actions embedded in them.

Effect of Inflation Targeting on Inflation Uncertainty: A Swarch Analysis

We analyse the success of inflation targeting (IT) in decreasing inflation volatility by investigating inflation variance before and after IT. We contribute to the literature by implementing Markov‐Switching AutoRegressive Conditional Heteroscedastic methodology to model inflation volatility. After determining the unbiased conditional variances of inflation in each inflation‐targeting country, we investigate structural breaks in inflation variability by both analysing individual countries and conducting a panel data analysis. All of these methods conclude that IT helps most of the countries to achieve lower inflation uncertainty (volatility). We also examine the country‐specific factors that determine the effectiveness of inflation‐targeting adoption.

Does National Culture Affect E-Procurement Implementations?: Analysis of Differences through a Unified Model

In the past decade, electronic mechanisms have started to overtake the conventional methods of procurement for both governments and enterprises because of the cost and time saving effects of e-procurement. Economic theory suggests that the success of e-procurement depends on the number of bidders who participate in procurement auctions. In this paper, the authors investigate the cultural factors that affect the usage and perceived acceptance of e-procurement process. This study identifies cultural barriers for adoption of e-procurement, which is essential for the success of e-procurement systems. The authors analyze extensive Eurostat datasets using Panel Data regression methods. Based on the empirical findings of the paper, the authors develop the Unified E-procurement Model UEM. This model describes the cultural perspective for a successful e-procurement system by combining cultural dimensions, the Technology Acceptance Model TAM, and the Competition in Auctions Theory CAT. The UEM exposes the working dynamics of cultural factors that affect participation to online procurement auctions and presents total savings achieved through higher participation of enterprises. The empirical findings of the paper have practical implications and provide a road map for an efficient e-procurement system implementation.

Price Manipulation by Intermediaries

In this study, we investigate two main research questions using unique individual trade level data from the Istanbul Stock Exchange (ISE; renamed Borsa Istanbul in January 2013): (1) Do brokers conduct manipulative trades in the ISE? (2) Do these brokers gain returns from their manipulative behavior? We examine the trade-based “pump-and-dump” price manipulation scheme. Using the complete intraday trading history of stocks listed on the ISE over the 2003--6 period, we find that a significant percent of the trades conducted by brokers can be identified as consistent with the pump-and-dump price manipulation scheme, and brokers that conduct more pump-and-dump trades earn marginally higher profits.

Financial Deepening and Economic Growth in Gulf Cooperation Council Countries

Abstract The goal of this study is to investigate the causal relationship between financial development and economic growth in Gulf Cooperation Council (GCC) countries, i.e. Bahrain, Oman, Kuwait, Qatar, United Arab Emirates and Saudi Arabia, over the period 1980–2012. We employ panel unit root tests, and Error Correction Model and cointegration techniques to detect long-run and short-run causalities between the variables used in our study. The overall empirical results reveal that the financial sector development contributes significantly to economic growth in the GCC countries. Our results could be of great interest for policymakers since the financial sector could play a crucial role in lowering the dependency of the governments to oil revenues and could contribute significantly to spur economic growth.

Inflation targeting as a signaling mechanism

This paper theoretically investigates inflation targeting when there is asymmetric information between the Central Bank and the public. The main argument of this study is that the inflation target can be used as a signaling mechanism through which the private sector learns about the private information of the Central Bank about future inflation and output. Thus, inflation targeting increases transparency and this causes the monetary policy actions (changes in the interest rate) to be more effective. I construct a Kalman filter algorithm to analyze the information and learning dynamics between the Central Bank and a representative private-sector agent. An increase (decrease) in the interest rate and the inflation target signals that the Central Bank has private information that inflation and output will be higher (lower) in the future thus the public expect inflation to be higher (lower) in the future. The main results of the paper are as follows. First, the private-sector agents (public) revise their expectations about future inflation and output after observing the actions of the Central Bank: changes in the interest rate and the inflation target. Second, in the case of inflation targeting, the response of inflation to a monetary policy shock (change in the interest rate) is higher than it is in the case of no inflation targeting. So, when there is inflation targeting the interest rate tool of the CB is more effective in decreasing inflation.

Inflation Target Credibility: Do the Financial Markets Find the Targets Believable?

We investigate the credibility of inflation targeting (IT) central banks (CBs) by estimating perceived inflation targets of the financial markets. We calculate financial markets’ beliefs about the inflation targets of 24 IT countries. Then, we analyse whether the financial markets’ beliefs about inflation targets match the announced targets. We conclude that the perceived upper bound of the inflation target is significantly higher than the announced one in many countries. Additionally, the perceived target band is narrower and asymmetric around the mid-point of the target for most CBs. We examine the implications of these findings and find that IT CBs are more likely to miss their targets when the perceptions of the financial markets are higher than the announced IT targets. These results indicate that IT CBs should pay attention to the perceptions of the announced targets when implementing policy actions.

Does Public E-Procurement Deliver What It Promises? Empirical Evidence from Turkey

ABSTRACT This article empirically investigates the economic effects of public e-procurement (PEP) adoption. We use a unique data set provided by the Public Procurement Authority of Turkey that covers all government procurement auctions for the years 2004–12, 588,454 auctions. We conclude that PEP adoption had adverse effects. The number of firms submitting bids in procurement auctions is significantly lower after PEP adoption. The procurement costs are significantly higher after PEP. These results suggest that policy makers should eliminate barriers to e-procurement adoption to gather the intended results of PEP.