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Global Business and Economics Review

Global Business and Economics Review (GBER)

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Global Business and Economics Review (59 papers in press)

Regular Issues

  • CROSS MARKET HERDING IN CHINESE, US AND CRUDE OIL MARKETS? QUANTILE REGRESSION ANALYSIS   Order a copy of this article
    by O.O.I. K.O.K. LOANG  
    Abstract: This study examines cross-market herding in Chinese and US markets from 2015 to 2020. It seeks to explore the impact of the crude oil market on Chinese and US. This study adopts cross-sectional absolute deviation to detect herding. This study employs quantile regression rather than OLS method to examine herding in different quantiles. The result shows that NYSE and NASDAQ are herded with each other. For Chinese markets, the bidirectional herding between Shanghai and Shenzhen tends to appear in median (Τ= 50%) and upper quantiles (Τ= 75% and 95%). The herding tendency of Shenzhen is higher than Shanghai and Nasdaq is higher than NYSE. The crude oil market can cause herding in US and Shanghai. The originality of this study contributes to academicians and practitioners in understanding the existence and tendency of cross-market herding. Investors shall aware that herding can be caused by the performance of other markets.
    Keywords: herding; stock market; Chinese market; US market; globalisation.
    DOI: 10.1504/GBER.2022.10044385
     
  • Institutional and geopolitical aspects of bond spreads impacts on corporate capital structure in emerging markets   Order a copy of this article
    by Sylvia Gottschalk, Bertrand Ndang 
    Abstract: This paper investigates the impacts of institutional, geographical, and political determinants of corporate capital structure of non-financial companies in a large panel of emerging economies, whilst controlling for macro-economic and firm-level factors, particularly corporate bond spreads. There is extensive literature showing that spreads are a measure of corporate riskiniess and that they affect a firm's ability to raise external funding via the issuance of equity or bonds. More recently, it has been established in development finance literature that a country's financial and legal systems have significant impacts on the capacity of its private sector to raise external investment funding. In particular, there is evidence that Common Law systems and market-based economies are more favourable to private investment and external financing owing to their stronger investor protection. Our results show that, when macroeconomic and firm-level factors are controlled for, most institutional variables have no significant impact on capital structure, with the exception of regulatory quality. The type of financial system, namely, "market-based" or "bank-based", and the legal framework (Common vs French law) have hardly any impact on capital structure. Our results also address the endogeneity issue between corporate bond spreads and capital structure, and show that both variables interact significantly with each other. Firm-specific variables such as profitability, tangibility and macroeconomic performance were found to be the common determinants of both leverage and bond spread.
    Keywords: Capital structure; corporate bond spread; emerging markets; bank-based vs market-based economies; governance indicators; financial systems; economic and political institutions; simultaneous equations models.

  • The Relation between Innovation and Earnings Management: Evidence for the UK   Order a copy of this article
    by Yahya Marei, Mohammad Al Bahloul, ADEL ALMASARWAH, Ashraful Alam 
    Abstract: The purpose of this paper is to investigate whether the executives of innovative firms in the UK economy. This study uses discretionary accruals and abnormal activities as proxies for earnings management and research and development as a proxy for innovation. This study finds dissimilar results for the discretionary accrual and abnormal activity models, it conducts additional analysis that accounts for the innovation to beat the earnings group, and refers to this group as the downward group; another analysis accounts for the innovation to reduce earnings, and refers to this group as the upward group. The results suggest that there is a negative association between discretionary accruals and downward innovation and finds a similar relationship in abnormal activities and the downward group, which indicates the referential value of beating earnings over innovation. This study also documented that innovative firms engage more in manipulation than non-innovative firms.
    Keywords: innovation; real and accruals earnings management; incentives; manipulation; UK.
    DOI: 10.1504/GBER.2023.10045679
     
  • Macroeconomic uncertainty and stock price crash risk: the moderating roles of operating performance and investor sentiment   Order a copy of this article
    by P.E.I. Y.I.N. WONG, Y.E.E. PENG CHOW 
    Abstract: This paper investigates the association between macroeconomic uncertainty and stock price crash risk and the two potential mechanisms through which the former may affect the latter, namely firms’ operating performance and firm-specific investor sentiment, based on a sample of listed firms from six Asia-Pacific countries (Japan, Singapore, South Korea, Malaysia, China and Indonesia) for the period 2009 to 2019. Sub-sample analyses are also conducted, where the sample firms are segregated into developed and developing countries. The empirical results show that macroeconomic uncertainty has a significant positive relationship with stock price crash risk for the full sample and firms in both the developed and developing countries. Subsequent analyses reveal that good operating performance strengthens the positive relationship between these variables for the full sample but the opposite holds true for firms in the developing countries. Furthermore, we find that higher firm-specific investor sentiment strengthens the positive association between these variables for the full sample and firms in the developing countries.
    Keywords: Asia-Pacific; investor sentiment; macroeconomic uncertainty; operating performance; stock price crash risk.
    DOI: 10.1504/GBER.2023.10046010
     
  • Is There a Relation between Stock Markets and Climate Change?   Order a copy of this article
    by Myeong Hwan Kim, Yongseung Han 
    Abstract: While economic growth has resulted in a secular upward trend in the performance of the stock market, the associated rise in economic activity has been responsible for the increase in carbon dioxide (CO2) emissions. The rise in emission levels has contributed to the phenomenon of global warming or climate change. Conversely, climate change may affect equity markets by the uncertainty which it produces. What is hypothesised in this study is that there should be an observable long-term secular trend in the US equity markets, and there should also be the seasonal variations described by other researchers. Taking this one step further, the increased CO2 emissions, if correlated with increased private productivity, should result in higher values for the underlying equities, than would be captured by a time linear time trend. Thus, this paper empirically examines the two-way relationship of variations in temperatures with the variations in equity market indices. The results provide evidence that there is a strong causal relationship from the changes in equity market indices to the changes in temperature levels, but there is no causal relationship in the opposite direction.
    Keywords: stock market; CO2; global warming; cointegration; causality test.
    DOI: 10.1504/GBER.2023.10046433
     
  • FDI, Gender Spillovers and Firm Productivity: The Namibian Case   Order a copy of this article
    by Reem El Sherif, Charles Adjasi, Michael Graham 
    Abstract: The benefits of FDI to domestic firms encompass technology and knowledge diffusion, known as spillovers. Knowledge transmission from MNCs can largely differ between total and female labour, yet this critical distinction remains a void in the literature. Using data from the World Bank Enterprises Survey and a new measure of spillovers to capture the gender dimension, this study provides empirical evidence on the impact of FDI spillovers on domestic firm productivity in both Namibia’s manufacturing and services sectors. The study finds a general negative effect of gender spillovers on domestic services firms’ productivity, and none in the manufacturing sector. However, the productivity effects of gender spillovers are positive when conditioned on managers’ years of experience in both sectors as well as on technology in the manufacturing sector. These findings provide important policy implications on how technology and managerial expertise can be used to tap into the potential of female employees to absorb their productivity benefits.
    Keywords: MNC; productivity; gender; spillovers; services; Namibia.
    DOI: 10.1504/GBER.2023.10046434
     
  • Determinants of Security Design in Venture Capital Investment: A study on Indian Start ups   Order a copy of this article
    by Sarita Mishra, Suresh Sahoo 
    Abstract: An imperfect competitive financial market has few underlying problems such as adverse selection and information asymmetry problem which is same in case of a venture capital (VC) investment deal. In these context VC investors designs their mode of financing to minimise the effect of above issues. This study encompasses various venture capital funds and their investment with Indian entrepreneurial firms to identify different factors contributing decision on security design of VC investor for the specific deal. Three categories of factors affect security choice by VC investors to invest in India: 1) firm characteristics including age of the firm, stage of the firm and type of industry; 2) VC characteristic include industry experience, total investment experience and past success experienced by the investors; 3) deal characteristics include size of investment, stage funding in round, syndication, control stake hold by VC, revenue generated in previous investment. The statistical significance of these factors is accessed through multinomial logistic regression analysis across different categories of security choice undertaken by venture capitalist in Indian start-ups.
    Keywords: venture capital investment; security choice; multinomial logistic regression.
    DOI: 10.1504/GBER.2023.10046436
     
  • The impact of Facebook and Instagram on the growth of Egyptian MSMEs   Order a copy of this article
    by Hadia FakhrElDin, Mahitab Shahin, Rania Miniesy 
    Abstract: This study examines the impact of using Facebook and Instagram on the growth of micro, small and medium enterprises (MSMEs) in Egypt. It uses both the social exchange theory and the task-technology fit theory to capture the different relationships and effects between the use of these two social media tools and the growth of MSMEs in Egypt. Growth is divided into financial growth (measured through the increase in sales) and non-financial growth (measured through customer engagement and brand performance). Linear regression and t-tests are conducted to identify and compare the effects of the use of social media platforms. Findings indicate that the use of social media has a positive effect on both financial and non-financial growth. Specifically, the use of Facebook has a greater impact on financial growth and brand performance, while the use of Facebook and Instagram combined has a higher effect on customer engagement.
    Keywords: brand performance; customer engagement; Egypt; Facebook; financial growth; Instagram; micro; small and medium enterprises; MSMEs; social media.
    DOI: 10.1504/GBER.2023.10046440
     
  • Bank Capital and Liquidity Creation: Evidence from Sub Saharan Africa   Order a copy of this article
    by Adamu Yahaya, Fauziah Mahat, Mohammad Tukur Saidu, Umar Tijjani Babuga 
    Abstract: Liquidity creation is among the major function played by banks in advancing economic development within a country. This study seeks to examine the effect of bank capital on liquidity creation among sub-Saharan African banks. Fifty (50) listed banks are drawn across six (6) sub-Saharan African countries consisting of Nigeria, Ghana, South Africa, Zambia, Kenya, and Tanzania, based on their financial market strength within the region. The system-generalized method of moment (GMM) is the analysis technique used for inference in the study due to its ability to address endogeneity bias and provide consistent findings. The findings from the study revealed a significant positive correlation between bank capital and liquidity creation. The study suggests that banks should always comply with regulatory capital guidelines provided by regulatory authorities to maintain their critical role of liquidity creation in the economy.
    Keywords: Tier 1 Capital; Cat_Fat; Cat_NonFat; Deposit ratio; Loan Ratio; System GMM.

  • Women Directors, CEO duality and Board Structure: Case of Indian firms’ Capital Structure Dynamism   Order a copy of this article
    by Pankaj Chaudhary 
    Abstract: We investigate the impact of women directors, CEO duality, and board structure on capital structure dynamism for Indian firms. We consider top non-financial BSE Group A firms for the time 2010 to 2019. We use dynamic panel data methodology to deal with endogeneity concerns that are prevalent in corporate finance variables. The board independence and women directors are positively related to the SOA. Their presence is associated with the faster adjustments of the firms towards the optimum capital structure. On the other hand, board size and CEO duality are negatively associated with the SOA. We further noticed that the speed of adjustment for the strong governance firms is much faster than the weak governance firms. We conclude that the prospective investors should study the governance system of the companies before investing and place a premium on the firms with a good governance system.
    Keywords: capital structure; speed of adjustment; SOA; women director; board of directors; CEO duality.
    DOI: 10.1504/GBER.2023.10046702
     
  • Business cycles in Ecuador: an analysis of stylized facts before and after dollarization   Order a copy of this article
    by Mercy Orellana, Rodrigo Mendieta, Santiago Pozo-Rodríguez, Joselin Segovia, Sofía Vanegas 
    Abstract: This study examines stylised facts related to the business cycle in Ecuador for the 1990 to 2019 period. To reflect on the dollarisation process that the country went through by the end of 1999, the analysis is conducted for two sub-periods: 1990 to 1999 and 2000 to 2019. The paper invest igates a wide range of macroeconomic variables for Ecuador, including variables regarding demand, the labour market, nominal variables, and variables related to an open economy. The sensitivity of correlations is studied through two detrending techniques: 1) the modified Hodrick-Prescott (MHP) filter; 2) a Hodrick-Prescott filter with a smoothing parameter of 1,600. The results reveal substantial changes in the cyclical behaviour of the Ecuadorian economy under dollarisation. In particular, the country shows greater dependence on the international market and high vulnerability to demand shocks.
    Keywords: economic cycle; Ecuador; dollarisation.
    DOI: 10.1504/GBER.2023.10047308
     
  • Declining Trade Interest in Indian Commodity Derivatives: A survey-based study on Cardamom Futures Contract   Order a copy of this article
    by Vijayakumar. A. N.  
    Abstract: Agri-plantation commodity futures contracts provide an opportunity for transparent price discovery and hedging to market participants in the commodity ecosystem. In this endeavour, the market regulator of derivatives and the government has been taking several measures for improving trade volumes, market efficiency and to protect the interest of trade participants. However, commodity futures contract volumes at the Indian Commodity Exchange has been experiencing a consistent fall in trade. This paper focusing on high-value cardamom futures contracts explored reasons for declining trade interest and falling trade volumes. This study with survey and impact of the event finds revised quality norms for fresh deposits of cardamom at accredited warehouses, higher cost of testing quality, raise in margin rate resulted in declining trading interest amongst market participants. The study also recommends appropriate policy to recognise exchange specific commodity trade norms considering Spices Board’s e-auction to benefit market participants. This would facilitate transparent and competitive price discovery and an opportunity for managing price risk through the hedging process.
    Keywords: cardamom futures; quality norms; margin money; commodity exchange; trading interest.
    DOI: 10.1504/GBER.2023.10047348
     
  • Synthesis of effect of investor sentiment on stock returns: a systematic review   Order a copy of this article
    by Ajit Yadav, Anindita Chakraborty 
    Abstract: The effect of investor sentiment on stock returns is a topic of long-standing interest amongst behavioural economists. This paper systematically reviews the literature on the effect of investor sentiment on stock returns. We have systematically reviewed 107 selected studies and analysed them based on the year, journal of publication, country of sample data, study type, techniques employed, and citations. The literature analysis reveals the dearth of literature on the sentiment-return relationship in developing economies. It also highlights that there exists no set consensus on the sentiment-return relationship along with a lack of clear-cut distinction between the effect of components (rational or irrational) of investor sentiment on the stock performance. It also questions whether the investors can hedge against future risk and whether distinct return patterns are based upon the lead-lag variation or is merely the effect of the optimistic exuberance of the investors.
    Keywords: investor sentiment; stock returns; stock markets; mispricing; trading behaviour; asset pricing; measuring sentiment.
    DOI: 10.1504/GBER.2023.10047752
     
  • Academic Footprint of “Financial Literacy and Financial Inclusion (FLFI)”: A review and Future research agenda   Order a copy of this article
    by Biswajit Prasad Chhatoi, Sarada Sahoo, Durga Prasad Nayak 
    Abstract: Despite the substantial interest by research geographer, experts, policymakers and World Bank, there are still atypical and disintegrated theories of financial literacy and financial inclusion (FLFI) as the research domain is still emerging. In response, the objective of this research is to review and synthesise FLFI research and to suggest directions for future research. We review certified knowledge (journal articles) published during the first two decades of 21st century. The research on FLFI is fragmented and has emerged in 21st century in diverse directions. The current research unearths key publication outlets and articles, theoretical and methodological approaches and major variables, and several themes of FLFI literature. The findings also suggest future research direction in FLFI and themes associated to them. The current research is an attempt to summarise the current state of the FLFI literature and unearths future research direction that requires immediate attestation.
    Keywords: financial literacy; financial inclusion; systematic literature review; financial awareness; financial services.
    DOI: 10.1504/GBER.2023.10047824
     
  • Do women use annual reports differently than men? A Case of India   Order a copy of this article
    by Meena Bhatia 
    Abstract: This study uses gender in financial research. The purpose is to examine women investors’ perceptions of the importance and understanding of sections of annual reports and problems that restrict utility. It also explores the perception towards the other announcements made by the corporates. Data was collected using a questionnaire sent to 700 individual investors. Descriptive statistics and non-parametric tests were used to analyse the data received from 341 respondents (48.71% response rate). Results indicated a significant difference between the frequency of use of annual reports and other announcements amongst both genders. Understanding various sections of annual reports is better for male investors than female investors. Women investors’ deficiencies in annual report utility had various implications for practitioners, standard setters, and regulatory bodies. Drastic improvements are needed in the awareness programmes for women investors.
    Keywords: announcements; emerging markets; financial statements; Ind AS; India.
    DOI: 10.1504/GBER.2023.10047978
     
  • Asymmetric Stock-Bond Interrelationships in Islamic Markets: EEMD-Based Frequency-Dependent and Causality Analyses   Order a copy of this article
    by Ahmed Bossman, Peterson Owusu Junior, Anokye M. Adam, Samuel Kwaku Agyei 
    Abstract: We examine the stock-bond interrelations using decomposed return series of stocks and bond yield in Islamic markets. We aim to establish the bi-directional relationships between the two assets classes amid the financial market turmoil consequentially presented to the world by the COVID-19 pandemic. We employ the ensemble empirical mode decomposition and quantile-in-quantile regression techniques to daily data between 23 November 2015 and 8 September 2021. We reveal that the stock-bond connection is bi-directional and varies across quantiles in Islamic markets. We submit that in the medium long-term of market stress, Islamic stocks and bonds are negatively interrelated and offer diversification opportunities to international investors who seek to maximise returns on their portfolio whiles minimising risks. The Pakistani market has few exceptions in the medium-term. We additionally find that stocks and bonds in Indonesia, Malaysia and Qatar can be diversifiers across all market conditions. The studys implications are further discussed.
    Keywords: ensemble empirical mode decomposition; EEMD; QQR; Islamic markets; quantile-in-quantile regression.
    DOI: 10.1504/GBER.2023.10048133
     
  • Fraudulent Financial Reporting Analyses Using Beneish Model: Evidence from Malaysian Public Companies   Order a copy of this article
    by Nurshamimi Sabli, Rosmini Mohd Aripin, Radziah Mahmud, Roszana Tapsir 
    Abstract: Increasing fraud cases are alarming, particularly during economic instability periods. In meeting the financial targets and secure financing to sustain business activities, companies may be involved in fraudulent activities. However, such unethical behaviour will adversely affect the sustainability of business in the long run. Adopting agency theory, this study intends to explore the influence of firm characteristics and corporate governance attributes on the fraudulent financial reporting (FFR) proxied by Beneish model. Based on 754 firm-year observations from public listed companies in Bursa Malaysia from 2018 to 2020, it is found that only the firm characteristics have influenced the inclination for fraudulent financial reporting activities. Apart from contributing additional knowledge to existing literature, this study is expected to provide valuable insights to the industry players in Malaysia to curb fraudulent activities through appropriate monitoring mechanisms, from both the firm characteristics and governance.
    Keywords: fraudulent financial reporting; FFR; firm characteristics; corporate governance; Beneish model.
    DOI: 10.1504/GBER.2023.10048178
     
  • Efficiency and its determinants of systemically important Shadow Banks of India   Order a copy of this article
    by NANDITA BHATTACHARJEE, Ambika P. Pati 
    Abstract: The growth of shadow banks (SBs) across the globe is ubiquitous, and they are playing a major role in the financial system of all the developed and emerging economies. During the last decade, India as an emerging economy has seen a phenomenal growth of their activities which has prompted the Reserve Bank of India to bring these financial companies under a robust regulatory structure. This necessitates an understanding of their functioning with respect to their efficiency. With ten years dataset of SBs, the efficiency score is ascertained. Data envelopment analysis approach has been employed to ascertain their efficiency. The Malmquist productivity index is applied to see the changes in efficiency over the period. Followed by Tobit regression to determine the influence of efficiency on bank variables. The findings reveal that improvement in internal practices, cost control and monitoring the asset quality is imperative.
    Keywords: shadow banks; efficiency; determinants; India.
    DOI: 10.1504/GBER.2023.10048272
     
  • Good Governance and Financial Crises: A Global Evidence   Order a copy of this article
    by Davoud Mahmoudinia, Behrouz Sadeghi Amroabadi 
    Abstract: The purpose of this study is to provide empirical evidence on the links between financial crises and good governance indicators. We employ the data for a sample of 89 developing and 29 developed countries from 1996 to 2018 to investigate the links. In line with the literature, our dependent variables are banking, debt, currency, and twin and triple crises. Using a panel logit model, we find that good governance, low corruption, increased transparency, a modern legislation system, and high political stability could reduce the likelihood of financial crises in all three samples (developing countries, developed countries, and all countries). The study also shows a positive relationship between various types of financial crises and a large number of macroeconomic variables, including inflation, exchange rate, debt, real interest rate, and credit. Moreover, according to our results, GDP and foreign direct investment could reduce the likelihood of any financial crisis. Hence, this study contributes to the literature by considering good governance indicators as influential factors leading to different types of financial crises.
    Keywords: good governance; financial crises; developing countries; developed countries; logit model.
    DOI: 10.1504/GBER.2023.10048351
     
  • Are broker-sold funds flows sensitive to fund performance or not ? Evidence from Indian Mutual Funds Market   Order a copy of this article
    by Dipika, SHVETA SINGH 
    Abstract: The primary purpose of the study is to investigate whether funds flows are sensitive to fund performance or not and to gain insight into how investors from different fund categories react to funds flow and performance relationships in the broker-sold segment. By using the panel dataset, the sample of 138 surviving open-ended regular mutual funds from April 2014 to March 2018 is considered. The study assesses the evidence that past performance has a significant positive influence on the fund flow and different categories have different level of investor sophistication through Sirri and Tufano (1998) fractional flow model, piecewise regression and Fama and MacBeth (1973) approach. The study’s findings can be used by regulatory bodies and policymakers to develop effective regulations for increasing market penetration, investor awareness, and transparency. The findings of the study assist the various stakeholders in understanding the behaviour pattern of investors while making an investment decision.
    Keywords: Indian mutual fund; equity fund; fund flows; fund performance; balanced funds; raw return; fund age.
    DOI: 10.1504/GBER.2023.10048353
     
  • Financial Conservatism and Shareholders’ Value   Order a copy of this article
    by Ammara Yasmin, Abdul Rashid Abdul Rashid, Saba Kausar 
    Abstract: Conservative use of leverage makes the firm less susceptible to financial risk. The use of debt is also proscribed as per the Islamic financing approach. On the contrary, dominant theories of finance appreciate the use of leverage to attain higher returns. To solve this puzzle we have empirically examined the long-run performance of firms that use financially conservative policy in Pakistan. This is the first study comparing the long-run performance of financially conservative firms classified into; a business-group affiliated with non-affiliated, dividend-paying with zero-dividend and financial surplus with financial deficit. We have analysed data from 146 non-financial publicly listed companies for a period of 21 years (1998 to 2018) using the Fama and French three-factor model and the CAPM. The results of this study have strong implications for investors, as we discover that the stocks of financially conservative firms generate positive abnormal returns regardless of any classification.
    Keywords: capital structure; net debt ratio; financial conservatism; zero leverage; shareholder’s value; business groups.
    DOI: 10.1504/GBER.2023.10048646
     
  • Spillover Effect of Economic Risks, Globalization and Herding in GCC and Malaysian Islamic Markets during COVID-19   Order a copy of this article
    by O.O.I. K.O.K. LOANG  
    Abstract: This study examines the impact of economic risks and globalisation on herding in GCC and Malaysian markets before and during the pandemic. This study explores the spillover effect of the Saudi Arabia market over Islamic markets by using panel data and quantile regression. Panel-corrected standard error is adopted to rectify heteroscedasticity, and the data ranged from 2015 to 2021. The result shows that herding exists in Bahrain, Oman, Qatar, UAE and Malaysia during pre-pandemic, except in Kuwait and Saudi Arabia. The tendency of herding is more pronounced with the emergence of the pandemic. Trade freedom, investment freedom, financial freedom and economic freedom indices are significant to herding before and during the pandemic. The spillover effect of Saudi Arabia is shown in GCC markets except for the Malaysian market. This study assists the regulators and policymakers assess the determinants of herding as investors behave differently in a turbulent period. Analysts, individual investors and institutional investors can also benefit from this study to formulate a better investment strategy under the influence of economic risks and globalisation.
    Keywords: economic risks; globalisation; herding; GCC markets; COVID-19.
    DOI: 10.1504/GBER.2023.10048712
     
  • Impact of Economic Transition on the Outreach of Microfinance Sector   Order a copy of this article
    by Samapti Guha, Chandralekha Ghosh 
    Abstract: Microfinance Institutions in different countries initiated the process of transformation from non-profit entity to not-for-profit entity after 2003 to 2004. Again in 2006 to 2007, there is a transition from not-for-profit entity to for-profit entity. First transition needed for scaling up operations and the second transition needed to achieve self-sufficiency to render the services to marginalized people. In this paper, MFIs in Bolivia, Mexico and India are studied to understand the nature of transition in microfinance sector. We have carried out Exploratory Factor Analysis to understand Social, Financial and Operational factors for the period 2006 to 2007 and 2012 to 2013. Further we have carried out Confirmatory Factor Analysis to confirm the factors which influence outreach of women borrowers during these two different periods of transition. It is concluded that social and financial factors do not have any impact on outreach for the year 2012-2013 however it had influence in the 2006 to 2007.
    Keywords: microfinance; outreach; self-sufficiency; confirmatory factor analysis; exploratory factor analysis; economic transition.
    DOI: 10.1504/GBER.2023.10048713
     
  • Financial Reporting quality, audit quality and idiosyncratic volatility: Moderating role of family ownership concentration   Order a copy of this article
    by Afkar Majeed, Rohaida Basiruddin, Salman Khalid 
    Abstract: This study explores the relationship between financial reporting quality and audit quality on idiosyncratic volatility. The study also analyses the moderating role of family ownership concentration (FOC) on financial reporting quality and idiosyncratic volatility. This study uses a sample of 726 firm-year observations of non-financial firms listed in the PSX 100 index of Pakistan’s stock market from 2009 to 2019. The study uses the system-generalised method of moment analysis method. The main findings indicate that low financial reporting quality negatively and significantly affects idiosyncratic volatility. In contrast, audit quality positively and substantially impacts idiosyncratic volatility. Additionally, FOC moderates the relationship between financial reporting and idiosyncratic volatility. These findings will help regulators advance policies that can improve the informativeness of stock prices. Focusing on Pakistan, a developing market, this study adds value to the existing literature, as most previous evidence was derived from the developed markets. Moreover, the moderating role of FOC is not frequently investigated.
    Keywords: idiosyncratic volatility; financial reporting quality; audit quality; family ownership concentration; FOC; system generalised method of moment; Pakistan stock market.
    DOI: 10.1504/GBER.2023.10048761
     
  • Non-performing Loans in Central-East European Countries: Investigation of Macroeconomic, Policy, and Global Risk Determinants   Order a copy of this article
    by Agim Kukeli, Robert Forrester, Fitim Deari, John Martinez 
    Abstract: This study investigates the impact of macroeconomic, policy, and global risk variables on non-performing loans (NPLs) for 18 Central-East European Countries (CEEC) over 26 years (1995 to 2020). The study uses the method of unbalanced panel data analysis. Results reveal that comprehensive triple-factor analyses explain NPLs variation for the period and countries included in this study. We find that an increase in GDP growth, inflation, and trade decrease NPLs while an increase in credit availability, lending rate, and exchange rate increase NPLs. We find that an increase in Euro-area GDP growth and unemployment rate will increase NPLs. These effects are sensitive to both pre-and post-US Great Recession and for middle-income/high-income countries. The novelty of this study rests on being the first to investigate economy-wide aggregate factors’ impact on NPLs. and confirming that there is room for policymakers to mitigate bad loans before and when they become a problem.
    Keywords: macroeconomic variables; non-performing loans; NPLs; unbalanced panel data analysis; global risk variables.
    DOI: 10.1504/GBER.2023.10048807
     
  • Using Product Space to Connect Local Products to Foreign Markets: Paths for Export Basket Diversification of the Brazilian state of Minas Gerais   Order a copy of this article
    by Otavio Rezende, Marcelo Andrade, Josiane Rafaella Faleiro, Leandro Collares, Ítalo Daldegan De Oliveira 
    Abstract: The export basket is a key indicator of the economic development of a country (Hausmann et al., 2014). Therefore, export-oriented policies must be adopted to diversify exports and increase their volume. This study aims to identify sectors and markets that deserve support and investments based on the complexity index. We apply the product space methodology to select products with a latent competitive advantage and a high degree of sophistication that could diversify the Minas Gerais export basket. This application is based on the economic complexity theory, the product space, and economic indicators provided by the Dataviva platform. Results yielded include 12 products that could be exported by the state and their competitiveness levels in different markets. Sectors with latent potential and their behaviour in foreign markets derive from empirical analysis. The two main contributions of this work are the identification of products made in Minas Gerais with latent comparative advantage and the target market classification for these products.
    Keywords: economic complexity; competitiveness; comparative advantage; product space; priority markets.
    DOI: 10.1504/GBER.2023.10049053
     
  • Investor sentiment and firm characteristics   Order a copy of this article
    by Wafa Hadj Mohamed, Abdelfettah BOURI 
    Abstract: Baker and Wurgler (2006) have shown that securities that are difficult to value and have high arbitrage costs are more affected by investor sentiment. Indeed, we study the hypothesis that the securities of young, small, less profitable, less tangible, low dividend and high sales growth firms are the most vulnerable to investor sentiment. Using a VAR model, we find that in the Tunisian market, high sentiment leads to low future returns for the securities of large firms, the youngest, the least profitable, the least tangible, paying lower dividends and with lower sales growth. Furthermore, past returns with inverse characteristics can predict investor sentiment. Our findings also have practical investment and policy implications for investors and corporate decision makers, but also for policy makers in their assessment of financial fundamentals, hence for efficient market theory.
    Keywords: sentiment; returns; firm characteristics; VAR model; Tunisian market.
    DOI: 10.1504/GBER.2023.10049124
     
  • The Announcements of Unconventional Monetary Policies and Sovereign Bond Liquidity Premia   Order a copy of this article
    by Tarek Chebbi, Waleed Hmedat 
    Abstract: This article makes an original assessment of the ECBs asset purchase program effects on the sovereign bond liquidity premia in selected Euro area periphery countries by employing an event-study analysis during the period of 2009 to 2015. We provide evidence that monetary news emerge as a key determinant in bond market liquidity as measured by the CDS-bond basis. More specifically, the estimates show that all events were effective in countering upward pressure on Italian liquidity premia. Our findings show also robust and economically significant impact of events associated with securities markets program and outright monetary transactions on the Italian and Spanish liquidity premiums. Alternatively, some insights gained from our study include an imperative for a careful effect identification and the review of the legitimacy of the perfection of bid ask spreads. Surprisingly, the information contained in unconventional monetary announcements does not matter for assessing the liquidity dynamics of the 10-years sovereign bonds.
    Keywords: monetary policy; asset purchases; ECB; bond markets; liquidity.
    DOI: 10.1504/GBER.2023.10049359
     
  • Nexus between Credit Default Swap Spreads and Foreign Exchange Rates: Evidence from BRICST, E7, MINT, and Fragile Five Countries   Order a copy of this article
    by MUSTAFA TEVFIK KARTAL, Serpil Kilic Depren, Özer Depren 
    Abstract: The study investigates the nexus between credit default swap (CDS) spreads and foreign exchange (FX) rates in leading emerging countries, most of which CDS spreads are high and volatile. In this context, six leading emerging countries are included, daily data between October 8, 2004 and July 23, 2021 is used, nonlinear econometric models such as wavelet coherence (WC), Granger causality in quantiles (GCQ), and quantile-on-quantile regression (QQR) approaches are applied, and quantile regression (QR) is performed for robustness checks. The WC results show that there is bidirectional nexus between the CDS spreads and the FX rates. While the CDS spreads drive the FX rates until 2012, the FX rates drive the CDS spreads after this date. Also, the GCQ and QQR outcomes present that the nexus exists in almost all quantiles excluding middle quantiles (0.35, 0.40, 0.45, 0.50) and the highest quantile (0.95) for some countries whereas country-based results change.
    Keywords: CDS spreads; FX rates; emerging countries; nonlinear approaches.
    DOI: 10.1504/GBER.2023.10049730
     
  • Does Microfinance Foster Development? A Critical Review of Literature   Order a copy of this article
    by Md. Atiqur Rahman, Salah Uddin Rajib 
    Abstract: We reviewed literature on impacts of microfinance on poverty, women empowerment, social welfare of participants, and on macroeconomic impacts of microfinance. Forty articles and five books published between 1996 and 2021 were reviewed. Researchers generally agree that microfinance increases consumption and generates income for participants. But several studies find improvement in consumption to be led by misappropriation of microcredit. Sufficiency of income generated is also questioned. Researchers agree that generating savings, and developing entrepreneurship are prerequisites for sustainable escalation from poverty through microfinance. Impact of microfinance on women empowerment and social welfare remains ambiguous. Popularity of non-subsidised microfinance model raised concern about compromise of MFI social missions. In macro level, microfinance has trivial positive impact on GDP. It slightly reduces poverty headcount, and income inequality, and reduces production efficiency in short run. Significant regional differences in micro and macro level impacts have been observed. We also identified future research avenues.
    Keywords: microfinance; microcredit; poverty; women empowerment; mission drift; macroeconomic development; GDP; literature review.
    DOI: 10.1504/GBER.2023.10049901
     
  • Analysing the impact of financial constraints and group affiliation on mode of payment and announcement returns of the Indian acquiring companies   Order a copy of this article
    by Harshika Jain, Reena Nayyar 
    Abstract: This study aims at assessing the impact of financial constraints on mode of payment employed and announcement returns of the acquiring companies in India. Further, the study also aims at analysing the combined impact of financial constraints and group affiliation on the mode of payment and announcement returns of the acquiring companies. It is found that the likelihood of stock financing on part of acquiring companies’ increases with increase in the financial constraints and the market reacts positively to such stock funded acquisitions. Thus, the study is able to validate opportunity cost of capital theory. However, the financial advantage theory with respect to the mode of funding employed by group affiliated financially constrained acquiring companies cannot be substantiated by the results of the study.
    Keywords: mergers; acquisitions; financial constraints; group affiliated; mode of payment; event study; announcement returns; India.
    DOI: 10.1504/GBER.2023.10049904
     
  • Financial Innovation as a Response to Crisis - The case of Catastrophe Bonds   Order a copy of this article
    by Natália Teixeira, Alexandre Correia, Rui Vinhas Da Silva, Leandro Pereira, Sérgio Vinhas Da Silva 
    Abstract: Large fluctuations in stock markets, caused by financial problems that may originate in the sector itself, as was the case of the 2007 to 2009 crisis, or originate in other events, as was the case of the 2020 pandemic that led to a sharp drop in the stock market between the first and second quarter of that year, lead market players to look for instruments that can prevent large losses. This study aims to understand whether innovative instruments such as insurance-linked securities, more specifically catastrophe bonds, can be an alternative to other more traditional instruments. For this purpose, Pearson’s coefficient was used to analyse the relationship between the Dow Jones average yearly rate of return variable, between 2001 and 2020, and bonds and securities issued in the US, between 2001 and 2020. The results showed a strong or tending to strong positive correlation during a specific period of time.
    Keywords: insurance-linked securities; ILS; catastrophe bonds; financial innovation; financial crisis; Pearson correlation coefficient.
    DOI: 10.1504/GBER.2023.10050236
     
  • Brand’s visual identity on social media platforms: a content analysis   Order a copy of this article
    by Harsandaldeep Kaur, Muhammad Tanveer, Haider Mahmood, Kanwal Roop Kaur 
    Abstract: This paper investigates how brands delineate their visual identity in avatar (profile photo) and header (cover photo) on social media platforms. The content analysis of the top 50 Indian brands was conducted from 116 screenshots taken from the brand’s Facebook, Twitter, and YouTube page to determine the visual identity exhibited by brands on social media platforms. We found the actual use of visual elements, i.e., logotype, text type, typography, colour, and photographic elements employed by brands in avatar and header to demonstrate their visual identity. The findings also revealed that brands are inconsistent in wielding their overall visual identity across three social media platforms. Designers and marketers are suggested to position their brand across social media platforms strategically.
    Keywords: content analysis; logo; social media; visual identity; brands.
    DOI: 10.1504/GBER.2023.10050406
     
  • Efficiency Level of Zakat Funds for the Social Sector and Poverty alleviation in Indonesia   Order a copy of this article
    by Sri Herianingrum, Fatimatuzzahro Fatimatuzzahro, Tika Widiastuti, R. Moh. Qudsi Fauzi, Syed Alamdar Ali Shah 
    Abstract: This study aims to measure the efficiency of BAZNAS, LAZNAS and APBN funds. It uses input variables of total assets and operational costs and the output variables of funds received and disbursed using the data from 2002 to 2017 on data envelopment analysis (DEA) method. The average technical efficiency score of revenue and funds distributed by BAZNAS, LAZNAS is 80.30%. This means that there is a 19.7% chance that it can be optimised to achieve a perfect technical efficiency score. Meanwhile, the APBN received an efficiency score of 94.3%. Historically, the technical efficiency scores of BAZNAS and LAZNAS funds have fluctuated with a positive trend. Based on the results of multiple linear regressions, the effect of the efficiencies of BAZNAS, LAZNAS and APBN funds shows that their funds have a significantly negative effect on the poverty level.
    Keywords: National Amil Zakat Agency; BAZNAS; LAZNAS; APBN fund; data envelopment analysis; DEA; technical efficiency score; economy; Indonesia.
    DOI: 10.1504/GBER.2023.10050556
     
  • A Bibliometric Analysis on Foreign Direct Investment   Order a copy of this article
    by Haitham Nobanee, Abeer Al Misleh, Lukas Christian Christnacht, Mohammed Bayzid, Salah Albeshr, Hiba Zaki Shanti 
    Abstract: Foreign direct investment is defined as expanding a business beyond one’s domestic country, is a continuously growing topic that has gained the attention of numerous scholars all around the world. This interest has developed as a result of the great economic and social impact FDI leaves in a society. The purpose of this paper is to present a bibliometric review on this topic including all papers published until 2020 as there is a need to have a comprehensive analysis on all literature that will help in identifying the literature gap and guide future researchers when conducting their research. The bibliometric analysis methodology was conducted on 4,525 articles between 1942 and 2020 on the subject of FDI. The data was extracted only from Scopus as we wanted to focus our attention on the leading worldwide used citation database that includes modern material. The top authors, countries, organisations, and documents were also identified.
    Keywords: foreign direct investment; FDI; economic growth; capital flow; globalisation; multinational enterprises.
    DOI: 10.1504/GBER.2023.10050902
     
  • Impact of social progress on bank stability   Order a copy of this article
    by Abderazak Bakhouche, Teheni El Ghak 
    Abstract: This paper examines how social progress and its dimensions, i.e., basic human needs, foundations of well-being, and opportunity, play a significant role in shaping the financial stability of banking systems. It empirically assesses the viability of three bank-level transmission channels: efficiency, diversification and competition, through which social progress propagates its effects on bank stability. Using bank-level data for 815 commercial banks from 49 countries during the 2011 to 2019 period, the results show that heightened social progress positively affects bank stability. Furthermore, the impact of social progress on bank stability can be realised through efficiency and diversification as conduits, with little evidence being found for the competition conduit. Findings support that policy should consider social progress-based prescriptions beyond traditional GDP growth models to bolster bank stability.
    Keywords: bank stability; competition; diversification; efficiency; social progress.
    DOI: 10.1504/GBER.2023.10050903
     
  • Modelling long memory dependence structure using FIGARCH-copula approach evidence from major Asian stock markets   Order a copy of this article
    by Pankaj Kumar Gupta, Prabhat Mittal 
    Abstract: Increased volatility in the stock markets has led the market to originate a new variety of techniques to predict markets efficiently. The aim of the study is to scrutinise the potential dependence among different Asian stock markets, using the FIGARCH copula approach. In the first step, the marginal distribution for the copula has been estimated with the best-fit approach using minimum AIC on the underlying assumptions of normal, Student-t and generalised error distribution (GED). The results indicate that Student-t best fits for the return series SHANGHAI and NIKKEI, while GED for the HANG SENG, KOSPI and NIFTY. In the next step, we have used Gaussian, Student-t, and Clayton copula to estimate the parameters and the dependence measures. The performance of the three copula distributions has been compared based on AIC and BIC criteria. We find t-copula performs better than the other two copula functions.
    Keywords: long memory; volatility forecasting; stock market; fractionally integrated-GARCH; copula.
    DOI: 10.1504/GBER.2023.10050904
     
  • Earnings management and bank funding   Order a copy of this article
    by Van Dan Dang, Hoang Chung Nguyen 
    Abstract: This paper investigates the impact of earnings management on bank funding. Using a sample of Vietnamese commercial banks between 2007 and 2019, we reveal that greater earnings opacity of banks causes a significant drop in total bank funding. When decomposing total funding into its components, we find that wholesale funds are the primary driver of the result, while no significant effect of earnings manipulation on retail deposits is documented. Further analyses on bank heterogeneity indicate that the unfavourable impact of earnings opacity on banks’ wholesale funds is less pronounced for banks that are better-capitalised, more liquid, larger in size, more profitable, and less risky. Through this consistent pattern, we can conclude that the financial strength of banks may alleviate the adverse effect of earnings opacity on bank funding. Our findings firmly survive after a series of robustness tests.
    Keywords: bank funding; discretionary loan loss provisions; earnings opacity; retail deposits; wholesale funds.
    DOI: 10.1504/GBER.2024.10050905
     
  • Debt-Based Financing: A Case Study of Malaysian Islamic Banks   Order a copy of this article
    by Abdul Muneem, Nor Fahimah Binti Mohd Razif, Abdul Karim Ali, Muhammad Ikhlas Rosele 
    Abstract: The present study aims to address the concept of debt-based financing from the Shariah perspective and to analyse the current practice of debt-based financing by the Islamic banks in Malaysia. A qualitative research approach is adopted using an in-depth study of the literature through classical and contemporary books to address the concept of debt-based financing. The practice of debt-based financing in Islamic banking is studied through the Islamic banks’ official websites. The present study reveals that the current Islamic banking system offers debt-based financing to the customers where the customers are liable to pay the debt through monthly instalments. However, the concept of dayn and the rights and responsibilities of a debtor is not clear to many customers, and the failure of fulfilling the obligation by the customers hinders the smooth operation of the Islamic banks. Moreover, debt-based financing is drawing more attention and interest among most Islamic banks as compared to equity-based financing which is creating more debt.
    Keywords: dayn; debt; debt-based contract; creditor; debtor; Islamic bank; Shariah.
    DOI: 10.1504/GBER.2023.10050906
     
  • A Conceptual Approach: Relationship between crisis, resilience, and entrepreneurial actions   Order a copy of this article
    by Shikha Bhardwaj 
    Abstract: The paper intends to capture deeper understanding and insights of how crisis influence entrepreneurial behaviour. It reviews the conceptual and developmental papers on crisis management. To formulate and build a distinctive conceptual framework, a review of existing literature focused on entrepreneurship, crisis management and COVID-19 was undertaken. The study identifies the impact of coronavirus (COVID-19) on entrepreneurs, factors that drive entrepreneurial intention during crisis and their entrepreneurial actions. As a result, most of the research studies identity entrepreneurial resilience as a force behind entrepreneurial behaviour during crisis. The factors determining entrepreneurial intention include self-efficacy, positive emotions, growth mind set and fear of failure. The findings act as valuable groundwork for future research on crisis management and entrepreneurship. From social, managerial, policy makers and economic perspective, entrepreneurial action act as catalyst to bounce back from crisis. Therefore, an integrated collaborative support mechanism may result in rise of entrepreneurial actions even during crisis.
    Keywords: entrepreneurial action; resilience; crisis; entrepreneurial action; COVID-19.
    DOI: 10.1504/GBER.2024.10051204
     
  • EFFECTS OF EXTERNAL AND INTERNAL INFLUENCES ON INTENTIONS TO AVOID SINGLE-USE PLASTIC BAGS   Order a copy of this article
    by Geetha Rajendran, Chandrasekaran Padmavathy 
    Abstract: The purpose of this research is to investigate the effects of external and internal factors on intentions to avoid single-use plastic bags. Data were collected using online survey from 703 consumers in India using convenience sampling method. The results indicated that green advertisements, retailers’ incentives, government policies (external factors), and extrinsic motivations and subjective norms (internal factors) had significant positive effects on intentions to avoid single-use plastic bags. The results of this study provide important implications to governments, policy makers, retailers, and the consumers to develop a sustainable eco-system.
    Keywords: single-use plastic bags; green advertisements; incentives; government policies; extrinsic motivations; subjective norms; sustainable consumption; India.
    DOI: 10.1504/GBER.2024.10051361
     
  • Dynamic Effects of Crude Oil Price Shocks on Stock Markets and Exchange Rates: Evidence from Major Oil Importing Countries amid Russia-Ukraine Conflict   Order a copy of this article
    by Bhaskar Bagchi, BISWAJIT PAUL, RAKTIM GHOSH 
    Abstract: The recent Russia-Ukraine conflict is having a serious impact on global economic condition. At this context, the present paper attempts to study specifically the effects of the steep surge in crude oil prices on stock market indices and real effective exchange rates (REER) of the major five crude oil importing (in terms of net imports) countries namely Peoples Republic of China, India, Japan, Republic of Korea, and Germany. The paper applies the DCC — MGARCH (1, 1) model based on daily data to capture the effect of the Brent crude oil price shock that uses a linear combination of the univariate GARCH model with time-varying cross equation weights to model the conditional covariance matrix of the error terms. The result of the study reveals that there is a noteworthy short-run (DCCα1) and long-run (DCCβ1) volatility spillover effects running from Brent crude oil price to all the stock market indices along with REERs.
    Keywords: crude oil price; real effective exchange rate; REER; stock return; DCC-MGARCH; Russia; Ukraine.
    DOI: 10.1504/GBER.2024.10051651
     
  • Financial revenues from land in Vietnam: Factors affecting their collection   Order a copy of this article
    by Pham Nam, Phan Thi Thanh Huyen 
    Abstract: The study aims to determine the factors affecting the collection of financial revenues from land. The study carried out a three-step survey through 400 householders to identify groups of influencing factors. Structural equation modelling (SEM) was used to assess the impact. Data checking was performed using SPSS20 and AMOS24 software. There are five groups of influencing factors. The group of human resources has the strongest impact; the group of people having financial obligations has the weakest impact on the realisation of financial revenues from land. To better realise financial revenue from land, it is necessary to strengthen human resources; complete the land database; adjust the level of land financial revenue; complete administrative procedures; raise the sense of law observance of people having land financial obligations.
    Keywords: affecting factors; collection; financial revenue; land; Vietnam.
    DOI: 10.1504/GBER.2024.10051660
     
  • THE ROLE OF MICROFINANCE INSTITUTIONS DURING THE COVID-19 PANDEMIC   Order a copy of this article
    by Hasan H.A. Ashari, Trinandari Prasetyo Nugrahanti, Budi Joyo B.J.S. Santoso 
    Abstract: This study found that BPR was selective in extending credit to entrepreneurs in the micro, small and medium enterprise (MSME) category. BPR has played a role in the 'Enough' category. The order of role values from the highest score is BPR BUKU 3, 2, and 1 based on assets, within and outside Java based on location. Moreover, the domicile of the BPR in the regency or city does not have a significant difference.
    Keywords: role of rural banks; COVID-19 pandemic; micro finance institution.
    DOI: 10.1504/GBER.2024.10051850
     
  • Earthquakes and Market Capitalization: A Historical Perspective Using Panel Data   Order a copy of this article
    by Andres Ramirez, Nezih Altay 
    Abstract: We test if earthquakes could create market value as companies invest to recover. Using a large firm-level data set spanning 299 earthquakes, in 15 years, in over 50 countries, we find evidence consistent with the creative destruction hypothesis. However, a closer look shows that earthquakes create value for firms in less developed countries (non-G8) while destroying value in developed countries (G8). We interpret this as a sign that innovation can be easier in poorer countries where the economies of scale of adopting new technologies are bigger. We also report a magnitude effect: large earthquakes tend to increase firm value while smaller earthquakes are associated with value destruction. We posit that large earthquakes trigger large corporate responses that increase productivity while smaller earthquakes are dealt with temporary measures. Finally, we report new moderators of the positive impact: multinationality of the firm, a country’s disaster preparedness and a country’s non-life insurance consumption.
    Keywords: market capitalisation; earthquakes damage; cross-country.
    DOI: 10.1504/GBER.2024.10052048
     
  • Alternative corporate entrepreneurship strategies for improving firm performance using the analytical hierarchy process   Order a copy of this article
    by Indra Wahyudi, Arif Imam Suroso, Bustanul Arifin, Meika Syahbana Rusli, Rizal Syarief 
    Abstract: This research was aimed at recommending alternative corporate entrepreneurship strategies for entrepreneurial orientation and leadership to improve company performance. Using a qualitative method, the factors of corporate entrepreneurship, entrepreneurial orientation, and entrepreneurial leadership strategies for lubricant distributors were determined through the analytical hierarchy process (AHP). This research was conducted in the lubricant business industry in Indonesia using focus group discussions (FGD) and in-depth interviews with several experts comprising distribution company owners, top management employees, and the principals. Subsequently, the results showed that the most dominant actor in improving performance is entrepreneurial leadership, and the leading actor is the owner. The findings obtained indicate that increasing sales growth is the main objective of improving company performance.
    Keywords: analytic hierarchy process; corporate entrepreneurship; entrepreneurial leadership; entrepreneurial orientation; firm performance; lubricant business.
    DOI: 10.1504/GBER.2024.10052452
     
  • Technical trading strategies return predictability and relative efficiency: Evidence from selected African stock markets.   Order a copy of this article
    by Kwame Osei-Assibey, Mweisho Nene 
    Abstract: We investigate the performance of several technical trading strategies in the stock markets of selected African economies and utilised the empirical evidence to rank the markets in terms of their efficiencies. The rationale for this study is simple: an asset whose historical prices fluctuate more randomly (relative to other assets) should offer lower profitable opportunities. Our momentum trading strategies (that also controlled for data snooping bias) generated significant number of profits for the Nigerian stock market, relative to the Egyptian and South African stock markets. We attributed our observation to the relationship between financial markets development and efficiency. Using our results, we ranked the South African stock market as relatively the most efficient, followed by the Egyptian and then the least efficient being the Nigerian market. We propose regular relative efficiency assessments across markets and regimes and discuss the benefits of such assessments to investors’ and policymakers’ decision making processes.
    Keywords: efficient markets; relative efficiency; technical trading strategies; Africa.
    DOI: 10.1504/GBER.2024.10052521
     
  • Green Finance: A Bibliometric Analysis of Current Research Status, Development and Future Directions   Order a copy of this article
    by Shikha Bhatia, Nidhi SIngh, Sushma Vishnani 
    Abstract: The present study identifies the current research trends, gaps in the field of green finance and suggests future research scope on the subject. We used bibliometric analysis on the sample of 846 documents collected from the Scopus database. The study used all the documents developed between the years 1997 and 2021 for the scientific analysis of literature on green finance. We identified the most influencing articles based on their citations, co-citations networks, the importance of their publications, locations, sources within the network. The present study also discusses the current research themes, existing research gaps and identifies future research themes by using factorial analysis in biblioshiny software. The review of existing literature suggests that although research activities on green finance happened worldwide, more collaborative research work is required on multi-cultural contexts, comparative studies between developed and developing economies, risk assessment criteria’, business performance indicators, etc. Other future research themes identified in the study include the need for the conceptual framework to assess various aspects of green finance, impact on stakeholders’ outcomes, and value enhancements. The current study provides future research directions based on in-depth literature review and themes derived from the cluster analysis.
    Keywords: green finance; bibliometric analysis; factorial analysis; thematic coupling; Scopus.
    DOI: 10.1504/GBER.2024.10052610
     
  • COVID-19 effect on the herding behaviour in the Indian stock market.   Order a copy of this article
    by Vikas Pandey, Shaurya Singh 
    Abstract: Investor psychology has often argued that subconscious factors play a crucial role in our decisions. One such factor is the herding behaviour of investors in stock markets. This paper attempts to analyse the presence of herding in the Indian stock market during the COVID-19 pandemic. The paper uses the CNX Nifty 50 Index, which consists of the fifty largest Indian companies listed on the National Stock Exchange (NSE). The paper uses the cross-sectional absolute deviation (CSAD) to analyse the presence of herding. The results obtained from the study indicate the presence of herding during the period of COVID-19 in the Indian stock market, more so during the market downturn. Herding behaviour is more prominent during the first wave of COVID-19 than in the second one. During the pandemic, investors’ fear and market uncertainty can lead to herding behaviour. This study gives insight into the effect of COVID-19 on the Indian stock market.
    Keywords: herding behaviour; COVID-19; Indian stock market; cross-sectional absolute deviation; CSAD.
    DOI: 10.1504/GBER.2024.10052841
     
  • Upgrading economic complexity in Africa: The role of remittances and financial development   Order a copy of this article
    by Folorunsho Ajide, Tolulope Temilola Osinubi 
    Abstract: Literature suggests that financial development and migrants’ remittances play a significant role in economic prosperity. However, nothing is known on the role of financial development and remittances in upgrading economic complexity for the case of African nations. This study contributes to the growing literature on economic complexity by providing insights on whether financial development serves as a policy tool in improving African economic sophistications. It also tests whether migrant remittances can be used to upgrade the economic complexity nature of African exports. The study employs Panel ARDL, the novel method of moment-quantile regression (MM-QR) and Dumitrescu-Hurlin Panel Causality to analyse the panel data of 21 African countries over a period of 1996-2017. The results reveal that financial development and migrant remittances can serve as veritable tools in upgrading the level of economic complexity in Africa. Further analysis suggests that remittance inflows and financial development perform substitutability role in upgrading African economic complexity.
    Keywords: Economic Sophistications; Broad-based Financial Development; Remittances; MM-QR.
    DOI: 10.1504/GBER.2024.10052893
     
  • Relative Price Shocks and Core inflation in Nigeria: Implication of Second-Round Effects for Monetary Policy   Order a copy of this article
    by Jamilu Iliyasu, Aliyu Rafindadi Sanusi 
    Abstract: This study employs a structural vector autoregression (SVAR) model to examine the second-round effects of shocks in food and energy prices on core inflation in Nigeria. First, the findings support the existence of second-round effects, showing that increases in energy and food prices have a positive and significant impact on core inflation. Second, the study finds that the response of core inflation to shocks in energy and food prices has increased since 2016. This study concludes that the sustained inflationary pressures in food and energy prices may have been transmitted to core inflation items in Nigeria. Furthermore, the evidence suggests that monetary tightening can help offset these second-round effects of food and energy price inflation. Therefore, one policy implication of this finding is that mitigating the second-round effects will require the Central Bank of Nigeria to aggressively respond to energy and food price shocks, though this may slow output growth.
    Keywords: food and energy price; core inflation; second-round effects; structural vector autoregression; SVAR; monetary policy; Nigeria.
    DOI: 10.1504/GBER.2024.10053101
     
  • Does Audit Quality affect Integrated Reporting Quality? Evidence from South Africa   Order a copy of this article
    by Abubakar Ahmed, Nuhu Abubakar, HAFIZAH A.B.D. MUTALIB, Nor Laili Hassan 
    Abstract: This article examines the effect of audit quality on integrated reporting quality (IRQ) through the lens of legitimacy theory. Specifically, we examine the effects of industry-specialised auditor and audit fees on IRQ in the context of South African companies. The sample consisted of non-financial companies listed on Johannesburg Stock Exchange (JSE), whose reports are available in provided by the International Integrated Reporting Council (IIRC). The data are analysed using the fixed-effect regression technique. The authors utilised a scoreboard approach and content analysis to measure the extent of disclosure (IRQ). We find that firms that employ industry-specialised auditors provide higher-quality integrated reports, and audit fees positively influence IRQ. These findings are relevant to firm stakeholders as they demonstrate the importance of external auditors in ensuring the credibility of corporate reports even as these reports expand to cover a broad spectrum of non-financial information.
    Keywords: integrated reporting; IRQ; audit quality; specialised auditor; audit fees; South Africa.
    DOI: 10.1504/GBER.2024.10053202
     
  • Corporate governance impact on financial performance: Evidence from Asian listed companies   Order a copy of this article
    by Bechir Chenguel 
    Abstract: This study explores the relationship between specific governance mechanisms, namely shareholder activism, the independence of the audit committee, with the financial performance of Asian listed companies. The estimating methodology used panel data from a panel of 622 listed Asian companies observed from 2012 to 2019. We used three estimation methods to ensure the quality of the results. For our robustness estimation, we establish an endogeneity test for the shareholder activism variable and test its impact on financial performance. Our results revealed a positive and significant relationship between the financial performance variable gender diversity, activism and board independence variables. Other mechanisms had a negative impact such as the duality, independence of the audit committee. Finally, for the robustness check, the endogeneity test revealed that the shareholder activism variable is endogenous and directly the dependent variable of our model. Our contribution is to test the effect of shareholder activism as a governance mechanism, on the profitability of assets, especially in the Asian context with six countries.
    Keywords: corporate governance; financial performance; endogeneity test; shareholders activism.
    DOI: 10.1504/GBER.2024.10053702
     
  • The COVID-19 impact on MSME earnings: evidences from Saudi Arabia   Order a copy of this article
    by Ahmad T. Al-Harbi, Moid U. Ahmad 
    Abstract: Small businesses are more prone to market a movement which gets aggravated in an uncontrollable scenario such as COVID-19. The objective of the study is to understand the impact of COVID-19 and the subsequent government's policy support, on the earnings of MSME firms in Saudi Arabia. Based on a selected study period (March-May 2021), a survey of MSME owners and managers was conducted (41% response rate) using a 33-item questionnaire. Linear regression analysis and moderation analysis was used for data interpretation. One of the key findings of the study is that firm's size and the government's economic support moderates the relationship of MSME operations with MSME earnings.
    Keywords: micro; small and medium enterprises; MSME; earnings; COVID-19; operations; government's support; Saudi Arabia.
    DOI: 10.1504/GBER.2022.10047621
     
  • Performance of the African stock market amid COVID-19 global health crisis: empirical analysis using four events   Order a copy of this article
    by Richard Danquah, Samuel Kortu Nelson, Chiamaka Nneoma Nweze, Peter Davis Sumo, Lydia Osarfo Achaa, Ishmael Arhin 
    Abstract: The study employs the market model and event study approach with four events to examine the performance of the African stock market amid COVID-19 global health crisis. We use daily stock market data from 14 African countries (as a proxy for the African market) spanning September 2019 to June 2021 and COVID-19 data to estimate average abnormal returns for Africa. The results show significant positive average abnormal returns in Africa when the WHO announced COVID-19 as a global health epidemic. The events of infections and deaths generated significant negative average abnormal returns while the event of vaccination did not generate any significant average abnormal returns in the market. In as much as pandemics are unpredictable, the African market quickly recovers as depicted by COVID-19; therefore, we recommend to investors, speculators, and portfolio managers not to quickly exit the continent during pandemics.
    Keywords: COVID-19; Africa; stock market; performance; event study; market model; abnormal returns.
    DOI: 10.1504/GBER.2022.10047570
     
  • Contagion or interdependence? Evidence from Asian emerging stock markets in times of COVID-19 pandemic   Order a copy of this article
    by Bhaskar Bagchi, Raktim Ghosh, Avijit Kanrar 
    Abstract: This study examines the presence of contagion effect along with interdependency between the stock markets of Asian emerging economies like China, India, South Korea, Indonesia, Hong Kong, and Thailand that are caused due to COVID-19 pandemic. The study employs an adjusted correlation coefficient along with the DCC-MGARCH model to capture the contagion effect or interdependency between Shanghai Composite and other select stock markets. Mild enhancement of short-run volatility (DCCα1) is found to be significant under the DCC framework during COVID-19 period only, although long-run volatility is insignificant in both periods. Contagion effect can be slightly traced in BSE Sensex, KOSPI, and SET 100 while market co-movement remains same for Hang Seng and JKSE Composite and thus they are interdependent with Shanghai Composite. Interestingly, adjusted correlation coefficients between Shanghai Composite and other stock markets increased substantially during COVID-19 period indicating the presence of high contagion effect amongst the markets.
    Keywords: COVID-19; stock markets; Asian economies; DCC-MGARCH model; contagion.
    DOI: 10.1504/GBER.2023.10048352
     
  • COVID-19 pandemic: revisiting the safe haven assets   Order a copy of this article
    by Musa C. Dasauki, Olusola B. Oluwalaiye, Jerry D. Kwarbai, Jesudara E. Oyesiji 
    Abstract: Different assets behave differently during different economic situations and investors are constantly searching for safe assets to hold and avoid volatile assets to hedge against risk. The study considered 13 safe haven assets across the world's largest economies during the COVID-19 pandemic. The GARCH (1,1) and the threshold GARCH models were applied. The results obtained from the model estimation test showed that COVID-19 and oil price had a negative effect on some safe haven assets. International stock has less volatility. The result also revealed that crypto currencies (Bitcoin, Tether, Etherium), stocks (Shanghai stock exchange), currencies (US dollars, Swiss franc, and pounds), precious metal (silver) and government securities (T-bond and T-bill) were less volatile but COVID-19 pandemic triggered higher volatility on precious metal (gold) and stocks (S&P500, CAC40).
    Keywords: asymmetry; cryptocurrency; metals; stock; volatility.
    DOI: 10.1504/GBER.2022.10045410
     
  • Investigation of cointegration and causal linkages on Bitcoin volatility during COVID-19 pandemic   Order a copy of this article
    by Tiffani, Ingrid Claudia Calvilus, Shinta Amalina Hazrati Havidz 
    Abstract: In this study, we focus on a prominent feature in Bitcoin: its volatility. This paper aims to examine the volatility action of Bitcoin's price during the COVID-19 pandemic through various angles: COVID-19 fear sentiments, investor fear sentiments, macro-financial factors, and crypto market factors. The study utilises daily data from 11 March 2020 to 31 May 2021. We implemented an ARDL bound testing approach to find cointegration, and the Toda-Yamamoto approach to further examine any existing causal relationships between the variables. The empirical results show that COVID-19 fear increased Bitcoin volatility and a unidirectional causal relation was found between them. Investor fear sentiments revealed that US dollar volatility moved in the same direction as Bitcoin volatility, while VIX was found to be insignificant. Gold, crude oil, and the stock market did not influence the volatility of Bitcoin. Overall, only crypto market factors were cointegrated with Bitcoin volatility in the long run.
    Keywords: autoregressive distributed lag; ARDL; Bitcoin; causal linkages; cointegration; COVID-19; crypto market; fear sentiments; macro-financial; Toda-Yamamoto; volatility.
    DOI: 10.1504/GBER.2023.10047173
     
  • COVID-19 and negative oil prices – an empirical analysis comparing importing and exporting countries   Order a copy of this article
    by Muhammad Umar, Joaquim António Martins Ferrão, Mário Nuno Mata 
    Abstract: The coronavirus pandemic has forced lockdown in many countries, reducing the use of vehicles and planes, resulting in a negative oil demand shock. In the USA, West Texas Intermediate (WTI) crude oil FOB spot price was recorded to be negative $36.98 per barrel on April 20, 2020. This would seem to be good news for oil importers and bad news for oil exporters. However, the results of an event study analysis of indices data ranging from July 1, 2019 to May 29, 2020 present a different picture. The incidence of a negative oil price had a negative impact on the stock markets of both major oil importing and exporting countries, although the effects on exporting countries were much more negative. Cumulative average abnormal returns, measured using a historical mean model and in reference to the event day of April 20, were significantly negative for all groups in the first two days, vanishing quickly in the very short term.
    Keywords: negative oil price; COVID-19; demand shock; energy markets; oil importing; event study.
    DOI: 10.1504/GBER.2023.10047425