John K. Ashton

Economic impact of national sporting success: evidence from the London stock exchange.

In this article strong association is reported between the performance of the England football team and subsequent daily changes in the FTSE 100 index, representing the price of shares in the 100 largest companies traded on the London stock exchange.

Cost efficiency in the UK water and sewerage industry

The paper quantifies the relative efficiency of the ten privatized water and sewerage companies between 1987 and 1997. A one–component fixed–effects panel data model is used to estimate a cost function from which distribution–free firm–specific estimates of operational cost efficiency are derived. The study differs from previous studies through the use of differing econometric techniques and by considering the water and sewerage companies as integrated firms. Overall, a moderate level of dispersion in operational cost efficiency is recorded.

Do national soccer results really impact on the stock market

This study is a response to Klein et al. (2008), which was highly critical of earlier work by Ashton et al. (2003). This work considering the link between international soccer results and stock market returns was challenged by Klein et al. (2008), who reject the presence and importance of this link. In response, this work provides a reassessment of the link between international soccer results and stock market returns within Ashton et al. (2003). This new analysis extends the original work by using a larger dataset, employing an extended range of tests and allowing for outliers. It is reported that, contrary to the findings of Klein et al. (2008), the link between international soccer results and stock market prices does indeed exist particularly within the sample period 1984–2002 used by Ashton et al. (2003). After extending the dataset to include observations from 2002 until 2009, it is reported that the effect on stock market returns has declined in importance over this period, particularly the impact of wins.

Regulatory Perceptions of Marketing: Interpreting U.K. Competition Authority Investigations from 1950 to 2005

This study quantifies the link between marketing and rulings on competition or antitrust law made by U.K. competition authorities. To determine whether differences in competition systems influence how marketing actions are interpreted by a European Union competition agency, the authors conduct a comprehensive examination of U.K. competition rulings from 1950 to 2005. Business activities judged to be permissible in the United States and anticompetitive acts in the United Kingdom and European Union occur frequently and are closely linked to marketing behaviors in U.K. competition investigations. The authors conclude that marketers in international firms need to develop a greater awareness of different national competition law systems and to contribute more to the ongoing discussion about the present and future form of competition policy.

Product innovation and consumer choice in the UK financial services industry

Purpose – Within the UK, low levels of saving has been a continuing policy concern for both government and financial regulators. Why individuals save less than might be expected has been increasingly associated with an inability of ma… financial services consumers to comprehend product quality and to underta… of firms in this debated through examining the product choices presented to consumers by financial services providers. Design/methodology/approach – We examine two aspects of poor consumer decision making, yet to be fully explored in the wider regulatory literature. Initially, we review how financial services providers consider product innovations and the marketing strategies they pursue in constructing their offerings to consumers. Secondly, we ass… a popular financial product, the interest bearing deposit account, to examine what savings product choices are actually presented to consumers. These areas are explored through semi-structured interviews undertaken with semi financial services managers and through a review of the entire product offerings to the interest bearing deposit market. Findings – We report that savings markets are characterised by high product turnover and short duration. Consumers in the UK, alike many developed nations, and often unfamiliar with, and lack confidence when, buying savings products. Example consumers often have difficulties when making product comparis… Faced by so much proliferation of undifferentiated products, consumers find difficult to make a straightforward comparison between products. Research limitations/implications – It is concluded that further public education, a greater understanding of ho… firms present product choices to consumers and how consumers perceive s… choices are areas demanding further research and consideration. Originality/value – Consideration of how firms make decisions with regard to product innovation and savings problem more generally is an area demanding further investigation from a range of disciplinary approaches. Finally, given the perceived high importance of financial services to individuals and the nation… economy at large, some scrutiny should be placed on the issue of the high profitability of the financial services industry and how this is reflected into product innovations and, therefore, differentiated quality choices presented various categories of consumers.

Efficiency and Price Effects of Horizontal Bank Mergers

This study provides an empirical assessment of the efficiency and interest rate changes occurring during 61 UK retail bank mergers. Key findings of the work include the general efficiency enhancing influence of UK bank mergers and the limited effect of merger on retail interest rates. Furthermore, different banking products appear to be influenced differently by mergers. It is proposed that future assessments of bank competition and mergers require an accommodation of different types of bank customer.

Do Lenders Cross-Subsidise Loans by Selling Payment Protection Insurance?

Abstract This study examines the recent UK regulatory decision to ban the joint provision of consumer lending and payment protection or credit insurance (hereafter PPI). This case has wide regulatory implications following concerns that the sale of PPI has been detrimental to customers due to overpriced PPI and a cross-subsidy flowing from PPI to unsecured lending. The study examines whether interest rate setting of unsecured lending is influenced by banks issuing PPI or otherwise to help establish whether such cross-subsidies have been made. This assessment is undertaken over time for a diverse and comprehensive selection of banks offering unsecured lending with and without PPI between 1998 and 2011 for three levels of borrowing. It is reported that offering PPI is a significant explanatory variable of unsecured lending interest rate levels. When unsecured lending is offered with PPI, interest rates are lower, a finding consistent with a cross-subsidy flowing from PPI remiums to unsecured lending.

Do Depositors Benefit from Bank Mergers? An Examination of the UK Deposit Market

Abstract This study examines whether depositors benefit from bank mergers Specifically, do horizontal retail bank mergers influence the availability and interest rates of deposit services? This examination is important, as the effect of mergers on customers is a primary merger assessment criterion in the European Union and the United States. The research question is addressed by considering 57 UK banking mergers over the period 1989–2008. It is reported that different deposit services and deposits of different values face statistically insignificant levels of interest-rate change after mergers. The availability of notice deposit services for low and high levels of investment are reduced after mergers and are largely unchanged for other deposit services. It is concluded that UK depositors benefit little from bank mergers, and different types of depositor face differences in the availability of deposit services after mergers.

Developing a financial services planning profession in the UK: An examination of past and present developments

Purpose - Against the backdrop of the Financial Services Authoritys Retail Distribution Review, this study aims to present an assessment of the potential development of a UK personal financial advising profession. The development of a profession dedicated to providing financial advice is critically discussed by assessing a range of regulatory and industry views. Design/methodology/approach - The study indicates both a critical literature review and survey of retail financial services planning advisors. The critical literature review considers the market failures which surround the provision of financial planning advice in the UK. A survey of professionally qualified personal financial planning advisers ascertains perceptions of developments to the current regulatory framework to accommodate a more professionally based system of financial advice. Findings - It is reported that a conflict between the current regulatory system and the traditional liberal model of the professions exist. This conflict inhibits the development of a financial services advising profession. Survey evidence collected from professionally qualified financial planning advisors bears out this perspective. Research limitations/implications - Two key research implications emerge from this study. First, the development of a professional model of financial planning advising appears to be inhibited by the current regulatory system. Secondly, current regulation of financial services sales through a market mechanism appears to limit access to financial planning advice. Practical implications - The study raises two key practical implications. First, the current system of regulating financial sales, appears to exclude a substantial segment of the population from access to professional financial planning services. Secondly, the development of a profession and increasing professional behaviour in retail financial services sales conflicts with the current model of regulation. Originality/value - This research paper both reviews the wider arguments surrounding the regulation of retail financial services sales and forwards new evidence as to the attitudes of professionally qualified financial advisors towards regulatory change. This has importance in clarifying a number of the key policy concerns in the regulation of financial services sales.

The Influence of Banking Centralization on Depositors: Regional Heterogeneities in the Transmission of Monetary Policy

Ashton J. K. and Gregoriou A. The influence of banking centralization on depositors: regional heterogeneities in the transmission of monetary policy, Regional Studies. This study examines whether regionally and nationally branching banks set deposits interest rates differently. This assessment of the UK retail deposit market between 1992 and 2008 indicates that regional banks set deposit interest rates in a manner distinct to nationally branching banks. Changes in the market interest rate to retail rates are characterized by a non-linear mean-reverting process. Deposit interest rates offered by regional banks are lower, slower to respond to wholesale interest rate increases, and swiftly respond to wholesale interest rate falls, relative to national banks. This evidence is consistent with distinct monetary conditions existing in UK regions.