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This paper constructs a panel smooth transition vector autoregressive model with a financial technology index (FTI) as a transition variable to explore the causality between inbound tourism and economic growth in 22 OECD countries. The model resolves the estimation problems of nonlinearity, heterogeneity, and endogeneity. The empirical results support that the causality is nonlinear, bidirectional, and time- and country-varying, depending on each country's FTI in each period. Under most FTIs, the current inbound tourism growth will crowd out the economic growth in the next period. When the FTI is higher than the threshold (81.27), the current economic growth will harm inbound tourism growth in the next period. For OECD countries with an FTI below the threshold (81.27), tourism companies should actively expand their investment to share the tourism dividend driven from the economic growth in the previous period. For OECD countries with an FTI above the threshold, the governments should adopt appropriate policies to reduce the impact of economic growth on the tourism industry, and tourism companies should increase tourism investment during the periods of economic downturn. [ABSTRACT FROM AUTHOR]

This paper employs panel smooth transition regression models with monetary policy proxies (interest rate and inflation rate) as the transition variables to estimate the earnings persistence of Taiwan's companies. The impacts of monetary policy on the persistence of systematic earnings and unsystematic earnings are lagged and different, depending on monetary policy variables in different regimes. High lagged interest rates and lagged inflation rates increase the persistence of current unsystematic earnings and reduce the persistence of current systematic earnings. Specifying 1.315% as an inflation target level and providing an environment of high interest rates can maintain stable earnings persistence. [ABSTRACT FROM AUTHOR]

This paper employs panel smooth transition regression models to investigate the nonlinear effects of two monetary policy proxies (i.e., real exchange rate return and real interest rate differential) on the international reserves-macroeconomic variables nexus. The panel data set includes the fourteen G-20 countries during the period 1991-2012. Empirical results show that the marginal effects of the macroeconomic variables (savings, terms of trade, public debt, capital account liberalization, economic growth, and trade openness) on international reserves are non-linear and vary with time, the proxies and countries, not linear and constant derived from traditional linear model. Currency devaluation policy (against the US dollar) can non-linearly enlarge the positive contribution of trade openness and public debt on international reserves, and non-linearly reduce the negative impact of terms of trade on international reserves, as the Marshall-Lerner condition holds. Expansionary monetary policy (through the decrease in domestic interest rates) can strengthen the positive effects of public debt, trade openness, and economic growth on international reserves. The precautionary and mercantilist views of reserves holdings are partially supported. [ABSTRACT FROM AUTHOR]

This study uses the panel smooth transition regression model with a debt ratio as the transition variable to evaluate the level of exchange rate pass-through. This model can investigate the threshold effect of the debt ratio on the pass-through. To perform the empirical estimation, we choose the 22 Organization for Economic Co-operation and Development member countries during 1994–2013 as sample objects. The empirical results show that the exchange rate pass-through displays a nonlinear and smooth transition process, depending on each period of debt ratio of the export country in different regimes. That is, the pass-through is nonlinear and varies with time and across countries. The larger the debt ratio is, the lower the pass-through would be. The threshold for the pass-through to generate smooth regime switching is 36.62% of debt ratio. [ABSTRACT FROM AUTHOR]

This paper employs the smooth transition autoregressive model to evaluate the persistence of oil price changes, and chooses monetary policy variables as transition variables of the model to assess their roles in the persistence effects. The empirical results show that oil price changes displayed asymmetric adjustments within different regimes and were more sensitive to the movement of interest rates than inflation rate. In addition, high inflation rate would give rise to low oil price persistence, and expansionary monetary policy would bring about higher oil price persistence. Moreover, when the short- and long-term interest rates were over their threshold values, the persistence effects of oil price changes were opposite. In the present relatively low US interest rates, adopting either an inflation-targeting policy or/and a debt-financing policy to stimulate economic growth, the timing is appropriate and the effect will be positive and expected because of low persistence of oil price changes. [ABSTRACT FROM PUBLISHER]