Impact of Celebrity Endorsement and Breaking News Effect on the Attention of Consumers

In the last decade, the new means of communication have determined substantial changes in human behavior and in the way individuals interact with each other. Besides the numerous benefits and opportunities that have arisen throughout the digitalization process, both for individuals as well as for private companies and state institutions, the widespread use of the Internet has generated vulnerabilities and threats. One of the most consistent concerns related to the new means of communication, especially social media platforms, refers to fake news. In recent years, major events including the 2016 presidential election in the US, Brexit, and the emergence of the COVID-19 pandemic have proven the negative effects of fake news on society. In this paper, we use an eye-tracking experiment to determine the unconscious reactions of consumers regarding the attraction potential of a fake news manner written article about a celebrity couple. The results of the experiment for this magazine’s article, with a fake title about the celebrity couple, show that the participants focus their attention on celebrities and fake titles mostly. The picture of the celebrities and the fake title of the article beats the other areas from the article and less on the information in the text. The research proves empirically that consumers are more attentive to celebrity pictures and fake breaking news titles and less to real information in the article. To sum up, testimonials and fake news play an important role in attracting publicity and influencing consumer behavior.

THE ASYMMETRIC VOLATILITY OF THE ISLAMIC CAPITAL MARKET DURING THE COVID-19 PANDEMIC

This study attempts to identify the existence of asymmetric volatility in the Islamic capital market in Indonesia during the Covid-19 pandemic. The paper employs the symmetric analysis of the GARCH (1,1) model and the asymmetric analysis of the TGARCH (1,1) model in order to identify Islamic capital market behaviour duringthe first 200 days after the first Covid-19 cases were confirmed. We used the daily closing prices of the Indonesia Sharia Stock Index (ISSI). The symmetric analysis of the GARCH (1,1) model revealed that the current value of return on the ISSI does not have a significant impact on its future value. On the other hand, the TGARCH (1,1) model showed that the asymmetric parameter coefficient was positive and statistically significant. Good news and bad news does not have the same level of impact on the volatility of returns on the ISSI. Furthermore, coefficients αi and γi in the variance equation indicate that good news has a higher volatility impact than bad news. The results indicate that investors should not to worry about the bad news effect of theCovid-19 pandemic, while the government should continue the mitigation of the spread of the coronavirus along with its economic recovery policy.

THE NEWS EFFECT OF COVID-19 ON GLOBAL FINANCIAL MARKET VOLATILITY

This study investigates whether the coronavirus (COVID-19) pandemic caused a contagion and negatively affected the stock market. Using data from the 10 worst-hit countries over the period from December 2019 to May 2020 and an EGARCH model, the study shows that market speculations lead to negative stock returns and higher stock market volatility. Further, estimates of both bivariate time-series regression and random-effects panel regression show significant effects of COVID-19 related media coverage on the stock market.

The Influence Mechanism of Reputation Information on the Formation of Safety Trust in Chinese Infant Milk Powder

Infant milk powder has always been one of the food categories most sensitive to safety reputation information. The safety reputation of Chinese infant milk powder has been seriously damaged due to the occurrence of safety accidents and the resulting consumers’ still-unrestored confidence is an important factor which restricts the dairy industry revitalization. Therefore, this paper analyzes the impact of reputation information on the formation of safety trust in Chinese infant milk powder, taking reputation information transmission as the starting point and consumer psychological perception as the researching perspective. A questionnaire survey was conducted and 685 valid questionnaires were collected. The structural equation model is adopted to verify the theoretical model and corresponding research hypothesis that reputation information affects the safety trust of Chinese infant milk powder. The reputation information transmitted between relatives and friends has a stronger effect on the formation of safety trust in Chinese infant milk powder than the media. The degree of media pursuit of “news effect” and negative word-of-mouth have a significant negative impact on the formation of safety trust in Chinese infant milk powder, while reputation quality, positive word-of-mouth and relationship strength have a significant positive impact on that. The quality of word-of-mouth perceived by consumers from highly involvement group, rational group, urban group and high-educated group has a stronger influence on the formation of safety trust. The degree of media pursuit of “news effect”, positive word-of-mouth, negative word-of-mouth and relationship strength perceived by consumers from low involvement group, emotional group, rural group and low-educated group have stronger influence on the formation of safety trust.

Do US News and Volatility in Exchange Rate Exposure Matter (Empirical Evidence from Emerging Economies)

This study is aimed to examine the impact of US News and exchange rate exposure on emerging economies of Pakistan, China, Turkey and Iran. Daily exchange rates have been used for the period Jan 1, 2003 to Dec 31, 2018 to identify the volatility in exchange rate exposure due to news effect. US News is modeled with variance equation respectively for each country exchange rate. GARCH (1,1) by Bollerslev (1986), and EGARCH (1,1) by Nelson (1991) models have been used to estimate the volatility of exchange rate dynamics. Results indicate that impact of US News is significantly positive on the exchange rate of Pakistan and China and the results of US news impact on Turkey and Iran are insignificant. Present study is helpful for investors, financial analysts and economic decision makers for understanding the changing dynamics of exchange rate volatility.

You are fake news: political bias in perceptions of fake news

Although the rise of fake news is posing an increasing threat to societies worldwide, little is known about what associations the term ‘fake news’ activates in the public mind. Here, we report a psychological bias that we describe as the ‘fake news effect’: the tendency for partisans to use the term ‘fake news’ to discount and discredit ideologically uncongenial media sources. In a national sample of the US population ( N = 1000), we elicited top-of-mind associations with the term ‘fake news’. Consistent with our hypothesis, we find evidence that both liberals and conservatives freely associate traditionally left-wing (e.g. CNN) and right-wing (e.g. Fox News) media sources with the term fake news. Moreover, conservatives are especially likely to associate the mainstream media with the term fake news and these perceptions are generally linked to lower trust in media, voting for Trump, and higher belief in conspiracy theories.