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International Journal of Economics and Business Research
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International Journal of Economics and Business Research (75 papers in press)
Abstract: This paper aims to investigate the impact of relational constructs on the intention of Cypriot retail banking customers to sustain a loyal banking custom. It aims to identify factors that repress switching behaviour or positively influence customers to stay with their current banking provider. The studys conceptual underpinning is based on seven relational constructs that deter customer switching intention and lead to customer retention, namely: satisfaction, affective commitment, continuance commitment, normative commitment, attitudinal loyalty, behavioural loyalty, and trust. An online survey based on self-completed questionnaires was used in the vicinity of Cyprus. The data analysis revealed that affective commitment and attitudinal loyalty are important motivators for customers to stay with their current banking providers. Behavioural loyalty and continuance commitment were not found to be significant predictors of staying. Concluding, attitudinal bonds and affective commitment seem to matter more in staying with a bank than switching costs, habitual purchasing and trust.
Keywords: staying intention; relational constructs; switching; satisfaction; loyalty; commitment; trust.
Abstract: After choosing the country to penetrate, foreign investors will decide the location for the operation. The decisions not only have to accommodate the institutional conditions that vary between home countries and host countries but also within the chosen host country. Based on theories of location choice, we analysed the impact of the determinants on the location choice of the high technology investors that used the institutional variables and traditional factors at the provincial level in Vietnam. The research used the methodology of spatial regression panel data and agglomeration effect in 63 provinces in Vietnam from 2007 to 2020. The results show that the institutional variables have a significant meaning on high-tech foreign direct investment (FDI), and the traditional factors affect the location choice of the investors.
Keywords: high-technology FDI; sub-national institution; location choice; Vietnam.
Role of Real Estate in Financial Instability: French Evidence
by Asma Saad, Muhammad Arslan, Ahmad Alqatan
Abstract: This paper evaluates the place of residential real estate in the stability of the French financial system. By employing three-stage least-squares (3SLS), we analysed the dynamic interaction between the real estate credit market and the evolution of real estate prices. This interaction creates a destabilising spiral that expounds the housing bubbles formation. In France, as in most developed countries, the increase in real estate credits was accompanied by an increase in property prices. Our estimate shows that an increase in home credit increases home prices and vice versa. Therefore, we conclude that there is a relationship of interaction between the two markets leading to a destabilising spiral. The study has important implications for policymakers and investors. The use of macroprudential policy is justified by the ineffectiveness of micro-prudential policy and monetary policy alone in ensuring the stability of the financial system. Monetary policy, via the interest rate, could not prevent the development and subsequent outbreak of the 2007 financial crisis. Existing studies are limited in exploring the interaction between the growth rate of real estate prices and the number of loans to housing in the French context. This study adds value to existing literature and confirms this interaction.
Keywords: housing; financial; macroprudential; 3SLS; monetary; French.
Technical Efficiency of Smallholder Sunflower Farmers in Singida, Tanzania: the Application of the Zero-Observations Approach
by Felister Tibamanya, Mursali Milanzi
Abstract: Improving agricultural productivity is crucial for enhancing income and alleviating poverty for the majority of farm households in sub-Saharan Africa. However, fostering productivity requires a good understanding of farm-level technical efficiency (TE). While earlier studies have examined TE across the globe, the current study applies rarely used the Zero-Observation Approach to compare the performance of the Translog and the Cobb-Douglas stochastic frontier models, based on 269 randomly selected smallholder sunflower farmers in Singida, Tanzania. The findings suggest that the Translog stochastic production frontier model fits our data better than the Cobb-Douglas stochastic production frontier model in the context of the zero-observation approach. The zero-observation inputs such as improved sunflower seeds and non-zero observation inputs such as land significantly influence sunflower output and technical efficiency. In addition, using this approach, some sunflower farmers were found to be fully technically efficient. Thus, suggest that the provision of improved sunflower seeds is imperative.
Keywords: technical efficiency; zero-observations approach; smallholder sunflower farmers; stochastic frontier; Tanzania.
Transmission of the 2010 Greek sovereign debt crisis to Asia-Pacific stock markets: A copula-based approach
by Salma Jayech, Emna Abdennadher
Abstract: The objective of this paper is to detect the contagion effect of the 2010 sovereign debt crisis in the euro area on the stock markets of 12 countries in Asia-Pacific. We have used a new approach based on the copula theory. The obtained results show the transmission of this crisis by pure contagion of the American index to the share indices of Australia, Hong Kong, the Philippines, Singapore and Taiwan, which is not the case for the Greek share index where we have noticed the existence of a strong interdependence between markets after the crisis, and not a contagion. Contagion has fundamental importance in the financial markets because of these consequences on the global economy in terms of monetary policy, international diversification, risk measurement and assets valuation.
Keywords: Greek sovereign debt crisis; Financial contagion; Asia-Pacific stock markets; Copula theory.
The Returns to Field of Study in Turkish Labor Market: A Pseudo-Panel Approach
by Bilge Eris Dereli
Abstract: This study employs pseudo-panel fixed-effects approach to estimate the returns to field of study in Turkey. Repeated cross sections of Turkish Labor Force Surveys between 2016-2019 are used. Year of birth and region are used as grouping variables. The results indicate significant earnings differences across field of study when cohort-fixed effects are controlled. Relative to the base field, Education Sciences, there are higher returns to Environmental Sciences & Mathematics & Statistics and Engineering & Manufacturing & Architecture and Health & Welfare. On the other hand, there are lower returns to Social Sciences & Journalism. The earnings differences are insignificant for the fields Art & Humanities & Languages and Business Administration & Law and Agriculture & Veterinary. These findings are important both for an individuals subject choice at university and education policies targeting to allocate resources more effectively to tertiary education.
Keywords: Keywords: Returns to field of study; pseudo-panel; Turkey.
Data envelopment analysis for decision-making units: a comparison of the relative efficiency of banks in the Kingdom of Bahrain
by Minwir Al-Shammari, Mohamed Sayed Abou Elseoud
Abstract: The study aims to measure and compare the relative efficiency of conventional retail and Islamic banks in the Kingdom of Bahrain over the period 2017 to 2019. The study adopts the input input-oriented CCR and BCC models of data envelopment analysis to compute both the aggregate efficiency scores of each banks group and the efficiency score of each bank. The sample of banks includes six conventional banks and six Islamic banks. At the same time, the selected inputs are total deposits, fixed assets, and owners equity, whereas outputs are credits facilities, total operating income, and net profit. The main findings show that both banks groups are efficient during the study period. At the level of individual banks, the conventional retail banks are more efficient than the IRBs in 2017 and 2019, while there are no significant differences between the efficiency in 2018. Finally, the study identified input and output slacks of inefficient banks, and it suggested the efficient input and output targets for improvements.
Keywords: Islamic banks; conventional banks; data envelopment analysis; DEA; CCR; BBC; relative efficiency; comparative efficiency; Bahrain.
Economic determinants of the crisis phenomena in modern Russia: endogenous and exogenous approach
by Alla B. Meshcheryakova, Tatiana A. Sapunova, Andrey V. Sapunov, Samvel S. Malkhasyan, Elina R. Rafikova
Abstract: The research is aimed at identification the economic determinants of the crisis phenomena of modern Russia in terms of endogenous and exogenous approaches. The authors proved that at each stage of the development of society, the economic crisis acquires unique properties that are characteristic of this particular period of time and the established social way of society life, the political regime and state administration. The authors confirmed three research hypotheses: 1) infrastructure and price fluctuations in the most important sectors of the economy can lead to crisis consequences regardless of the dynamics of changes; 2) the current economic situation in Russia has all the signs of an overproduction crisis; 3) the development of foreign trade under the influence of pandemic and epidemiological risks is a determining factor that strengthens the crisis trends in the Russian economy.
Keywords: economic crisis; causes of the crisis; overproduction; endogenous approach; exogenous approach; Russia.
Analysis of the Main Problems and Issues in Arbitration of the Foreign Investment Disputes: The Concept of Investment Dispute and Multiciplity of Arbitration Disputes Relating to the Same Investment
by Nour Alhajaya, Ramzi Ahmad Madi, Tariq Kameel
Abstract: Perhaps the most important problem with arbitration as a means of settling investment disputes, is to identify the concept of the investment dispute, identify parties, and indicate the criteria that are adopted to determine whether we are going to invest or not. Accordingly, we have identified in this research what is meant by an investment dispute, the parties to that dispute, and the criteria upon which to determine whether there is an investment or not, including: 1) the capital contribution to the host countrys economy over a certain period of time that allows for the building of continuous links between the investor and the host country; 2) giving the investor the right to exercise real influence and control over the management of his investment project; 3) this investment generates income; 4) investment is at particular risk and 5) stimulating the economic development of the host country. We have also identified the other problem facing arbitration in investment disputes, namely, the multiplicity of arbitration disputes relating to the same dispute, and the need to apply the positive and negative impact of binding force of res judicata and to deny other solutions to this problem.
Keywords: arbitration; investment dispute; foreign investor.
Genders and sexual harassment: the perception of Vietnamese employees via Sexual Experience Questionnaire
by XUAN QUYET PHAM, Viet Tien Ho
Abstract: Sexual harassment is a hidden problem of any workplace, not only in Vietnam but also worldwide. Sexual harassment commonly happens in the service industry since the employees frequently contact different guests or partners. Understanding sexual harassment and the levels of perceptions in different genders in the service industry will help to justify the solutions for upcoming problems. Using the sexual experience questionnaire of 390 respondents in Vietnam, the article reveals that females more significantly perceive sexual harassment than males in terms of gender harassment and sexual coercion. In contrast, both genders generally tolerate unwanted sexual attention. The results support the previous research in the same area since females are still the primary victims of sexual harassment at work. The recommendations help each company focus more on the employees to prevent any negative impacts from sexual harassment and purify the entire service workspace.
Keywords: sexual harassment; genders; Vietnamese employees; sexual experience questionnaire; SEQ.
Health and Time Allocated to Market and Household Work in Turkey
by Burcu Duzgun Oncel
Abstract: I examine the association between health and time allocation to market work and household work by using Turkish Time Use Survey in 2014. I define household work as the sum of time devoted to non-market work and leisure. In supplement to previous studies on the subject regarding Turkey, I consider two new aspects. One of these aspects I assess is the intertemporal component of time allocation decisions. The other aspect I cover is the potential selection bias of health status in time allocation decisions. For the former purpose, I focus on non-student, non-retired individuals. For the latter, I apply propensity score matching (PSM). Examining these two aspects, I find that as health improves, time devoted to market work significantly rises and time devoted to leisure falls for both males and females in this group. I also find that the association between health and time use on non-market activities is insignificant for males.
Keywords: health status; time use; propensity score matching; PSM; Turkey.
Reforms and Political Instability in Attracting Foreign Direct Investment: A simultaneous equations approach
by Walter Morales, Javier Barbero, Fernando Ubeda
Abstract: The present work aims to identify the elements that condition the attraction of foreign direct investment (FDI) to Latin America, a region that has achieved heterogeneous results under different reforms to improve its economic growth but that has not been exempt from political instability. In this regard, we first estimate this phenomenon through a probit model as a latent variable and then estimate a simultaneous equation model to describe the relationship between FDI, economic growth and political instability, addressing the problems of endogeneity and reverse causality, which are common in these dynamics. The procedure used also allows us to correct the problems related to heteroskedasticity and autocorrelation. The results show that FDI is conditioned by political instability and the latter by the reforms and their momentum. In addition, a favourable institutional framework of freedom and economic growth complements the attraction of FDI.
Keywords: simultaneous equations; political instability; foreign direct investment; FDI; reforms and economic growth.
Effect of Deal Size on M&A outcome on HR parameters : An empirical analysis
by VIRENDER SINGH, Girish Chandra Maheshwari, Rajan Yadav
Abstract: Mergers and acquisitions (M&A) are critical to achieving growth in intense globalisation for healthy and inorganic expansion of business firms. However, a relatively large number of M&A fail or can achieve suboptimal results. Previous studies that have attempted to analyse failed cases of M&A have focused on financial or strategy perspectives, thus not being able to explain the causes of failure. This accentuates the need to shift the focus to more qualitative human aspects that drive the social-cultural adjustment process in M&A. Our analysis of the impact of size on M&A (HR) outcomes shows a significant influence on the deal size. The content analysis and regression results of 48 cases show that large firms are able to better integrate, though the outcome varies across acquirer country-developed and developing. Tranching and deal size customisation can be strategic for optimal M&A HR outcomes.
Keywords: merger and acquisition; size; takeover; synergy; satisfaction; human integration; affective commitment; culture; achievement; change management and turnover.
Financial Development and Banking Industry Stability
by Rexford Abaidoo, Elvis Kwame Agyapong
Abstract: The banking industry plays an important role in the development of economies globally. This study examines the importance of the banking industry to the development of the financial system in Sub-Saharan Africa (SSA) by specifically verifying the effect of four bank stability variables on development of the entire financial system. Data for the study were compiled from 19 countries in the sub-region from 2001 to 2018; and the empirical estimates performed using the Prais-Winston panel corrected standard errors (PW-PCSE) estimation technique. The results suggest that bank liquid reserves and bank Z-score have significant positive effect on financial development. Growth in non-performing loans on the other hand is found to be inimical to the development of the financial sector all things being equal. The results further show that inflation uncertainty has significant positive moderating influence on bank liquid reserves financial development and non-performing loans financial development nexuses.
Keywords: financial development; banking industry stability; Prais-Winston panel corrected standard errors; PW-PCSE; governance quality; inflation uncertainty.
The antecedents to efficient working capital management (EWCM): Evidence from Turkish manufacturing sector
by Mumtaz Ali, Mehdi Seraj, Hüseyin Özde?er
Abstract: The purpose of this paper is to empirically analyse the influence of endogenous and exogenous factors on efficient working capital management (EWCM) of the Turkish manufacturing sector and analyse the impact of components of cash conversion cycle (CCC) on the performance, i.e., return on assets (ROA). Two-step generalised moment method (GMM) is used to extract the results using penal data of 133 firms in the manufacturing sector listed on Borsa Istanbul Turkey, consisting seven industries for the time period of eight years from 2012 to 2019. Results evidenced significant influence of endogenous (firm size, profitability, leverage, cash flow ratio) on CCC for manufacturing sector, while industry results are mixed. In addition, results of components of CCC and performance are significant. The sample has been taken from Turkey, and the results are generalisable in the emerged economy only. Therefore, comparative analysis of emerged and emerging economy can be done in future.
Keywords: working capital management; WCM; generalised moment method; GMM; manufacturing sector; Turkey.
Credit Risk and Bank Specific Factors: an Empirical Study using Panel GMM
by Renuka Sharma, Kiran Mehta
Abstract: The issue raised in current research has significant implications for the banking sector. Banks across the world are highly exposed to credit risk. The current situation of the banking sector in all major markets and the recent financial crisis of 2008 intensified the concern of economists to improve the credit risk management policies of banks. The increasing default rate in corporate loan portfolios and consumer loan portfolios increase the non-performing assets, which can lead to the banking crisis. The current study has explored the extant literature to identify the bank-specific factors affecting the credit risk of banks. The study under consideration is based on secondary data and has applied dynamic panel GMM regression to examine the impact of bank-specific factors on credit risk on Indian banks. The results thus obtained are useful for managers responsible for controlling the credit risk of bank, regulators, policymakers and researchers.
Keywords: credit risk; bank-specific factors; dynamic panel GMM regression; Indian bank.
Novel approach to consumer loyalty: A case study of hospitality service organisations among Generation X and Y
by Mei Kei Leong, Kamelia Chaichi
Abstract: Consumer loyalty is considered one of the significant factors that affect market growth and consumer behaviour. Regardless of the numerous studies on customer loyalty, the authors found no empirical study that elaborates on the importance of customer loyalty across generations. The majority of previous studies have proposed customer engagement and customer involvement as one construct in predicting customer loyalty. Thus, the current research tries to fill this gap in the literature by proposing a new model of customer loyalty blends multidimensional consumer involvement as predictors, multidimensional consumer online engagement as a mediator, and finally the moderating role of different generations (X and Y) in the hospitality services context. Present research collected (N = 390) data from Malaysia hospitality service organisations and the data were analysed using structural equation modelling. The results approve all the direct relationships as well as the moderating effect of generation generations X and Y. Moreover, the results confirm the mediating role of consumer online engagement among consumer involvement dimensions and consumer loyalty. The current study highlights significant implications to facilitate and increase consumer loyalty in the hospitality services context, especially in the airline, and hotel industries.
Keywords: consumer loyalty; consumer involvement; consumer online engagement; airlines; hotels; hospitality industry.
New Dynamics of e-Commerce on the Retail Industry: Analysis of the Purchase Process of Fashion and Electronics Products
by Rui Gonçalves, Catarina Dias, Leandro Ferreira Pereira, Renato Lopes Da Costa, Álvaro Dias, Rui Vinhas Da Silva
Abstract: The technology-mediated environment promoted the creation of new dynamics in the retail sector. To understand how the emergence of e-commerce has impacted the retail sector, this study analysed two distinct product typologies: fashion and electronics. Among the various conclusions of this work, we highlight a clear resistance to the emergence of e-commerce, even though a considerable part of the sample declares that the frequency of visits to physical stores has decreased, and the total frequency of purchases has increased after the appearance of e-commerce. The probability of completion of the purchase occurring on either platform increases when the search for information occurs on the same platform, however, possibly justified by the level of complexity of the product, the probability of the customer staying on the same platform during the electronics purchase process is marginally inferior to the fashion product model.
Keywords: e-commerce; retails; stores; fashion; electronics.
Theory and Fact of Japanese Capital Investment: Has the Japanese capital investment been made optimally?
by Kan N. Nakajima, Yasuhiro Yonezawa, A. Azeez
Abstract: The capital investment decision by the company should be made in a way that maximises its stock price. From this point of view, based on Tobins q theory, we examine the capital investment trends of Japanese companies using panel data after the burst of the bubble economy. The novelty of our paper is that the optimal capital investment is derived from clarifying the adjustment cost of capital investment in the analysis. Based on the derived adjustment costs, we investigate whether the capital investment has been optimal, using a sample of Japanese companies from 1990 to 2014. We find that the Japanese companies have been under investing for most of the period analysed. Our results indicate that the underinvestment by Japanese companies is not because of their strict financial constraints but because their capital investments are determined based on the return on equity (ROE) of the previous year. It should be emphasised that the capital investment decision is not made based on Tobins q. We conclude that Japanese companies do not make investment decisions from the perspective of maximising shareholder value.
Keywords: capital gain; capital investment; adjustment cost; corporate governance.
Do cryptocurrency and commodities markets affect stock market performance in South Asia? An empirical investigation during the COVID-19 pandemic
by Aamir Syed, Mohd. Kamal
Abstract: The emergence of cryptocurrencies, as well as global commodity price volatility, have affected the global stock market performance. The recent pandemic outbreak has exacerbated the situation. Against this backdrop, we sought to explore the relationship between cryptocurrencies, commodity, and stock market performances in South Asia, by segregating the data into two timelines. The results of GMM and fixed effects models reveal that cryptocurrencies and gold prices have a significant and negative impact on stock market performance. In addition, empirical findings also highlight that during COVID-19, the influence of cryptocurrencies and gold prices on the stock market was much greater (1.5% cryptocurrencies and 1.7% gold prices) compared to the pre-COVID-19 timeline (1.3% cryptocurrencies and 1.1% gold prices). The study also concludes that only Bitcoin and Ethereum have a significant impact on the stock market performance of South Asia. The findings offer several policy implications.
Keywords: cryptocurrency; stock market; oil prices; gold prices; IV-GMM; South Asia.
Amicable Settlements for Civil and Commercial Disputes: A Comparative Study of Emirati and Egyptian Legislations
by Moustafa Elmetwaly Kandeel, Ali Massadeh, Firas Massadeh
Abstract: Non-compulsory amicable dispute resolutions were examined by reviewing the legal nature and concept of mediation and conciliation within the legislations of the UAE and Egypt, in line with contemporary international legislations, such as that of France. We considered those civil and commercial law disputes which may be subject to amicable dispute resolution in pre-trial proceedings, including labour and family law matters and intellectual property rights. Within the latest legislative amended provisions, we also focused on whether the role of the judiciary within the amicable dispute resolution process is an efficient means of conciliation/mediation, and found that some modification of the respective Egyptian and Emirati judicial roles concerning the appointment of a conciliator/mediator is required. With regard to reaching an independent agreement, we present a potential model for doing so via amicable dispute resolution which is based on judicial procedures and strict binding stipulations.
Keywords: amicable dispute resolutions; conciliation; meditation; arbitration; civil procedures law; civil law; labour law; United Arab Emirates; family law Egypt.
Antecedents of Construction Project Performance And Contingent Role of Prosocial Behavior
by Syed Arslan Haider, Mário Nuno Mata, Shehnaz Tehseen, José Martins
Abstract: The purpose of this research study is to empirically test the impact of mastery climate (MC) on project performance (PP) through the mediating role of collaboration in team (CIT) and moderating role of prosocial behaviour (PSB). The probability random sampling technique and two-time lags T1 = 327 and T2 = 300 was used to collect data from employees working in project-based construction companies of Pakistan. Partial least squares-structural equation modelling (Smart PLS SEM v.3.2.8) software was used to test hypotheses. The result indicates that MC has a significant and positive impact on PP. Also, CIT is considered as a potential mediator between MC and PP. However, findings indicate that PSB positive effects on project performance at T1 but after passing time at T2 negative effects on project performance. Furthermore, study significantly contributes to the area of research in the domain of project management. In the end, the implications for project managers and future research are discussed.
Keywords: mastery climate; collaboration in team; CIT; prosocial behaviour; project performance.
The performance of Italian and French listed companies during the financial crisis period 2008-2017
by PANAGIOTIS CHARALAMPAKIS, Antonios Georgopoulos, ILIAS MAKRIS, George Mavridoglou, Stavros Stavroyiannis
Abstract: The purpose of this research is to evaluate the French and Italian publicly listed companies performance, analysing data from 322 and 68 companies respectively, during the recessionary period 2008 to 2017. The proposed methodology utilises variable-reduction principal component analysis (PCA) firstly and then panel data analysis. PCA aims to reduce a more extensive set of indicators, to a smaller set of principal components that account for most of the original variables variance. The initial data refer to a time-series of 14 financial indicators, collected from world scope database. Four new components arose, and were analysed using a panel data model for the decade 2008 to 2017. The research contributes to the existing literature as it studies the effect of the combination of three specific components (market, debt, internationalisation) on the performance of companies and extends the study to France and Italy, two of the largest economies in Eurozone.
Keywords: financial performance; listed companies; France; Italy; principal component analysis; PCA; panel data analysis.
Investigating the impact of organization culture, personal-job fit and employee engagement on turnover intention: An assessment of IT sector from an emerging market perspective
by Viral Bhatt, Sujo Thomas, Dhruti Chauhan, Ritesh Patel
Abstract: This study investigates into the influence of organisation culture (OC) and personal-job fit (PF) on employee engagement (EE) and its resultant impact on turnover intention (TI) in the lower and middle level employees of information technology (IT) sector. This study was undertaken due to the paucity of literature with respect to TI in the public domain, especially related to the IT sector from emerging market perspective. The results indicate that OC and PF are positively associated with employee engagement (EE) but EE negatively affects TI. This research further demonstrated the mediating role of EE, such that the higher level of OC and higher PF led to high EE and subsequently, resulted in lower TI. The findings of this study offers practical insights to HR professionals associated with the IT sector, to effectively design engagement and retention strategies. Additionally, it assists HR managers of IT sector to design long-term strategies by acknowledging the vital role of EE and its key influence on TI.
Keywords: organisation culture; personal-job fit; employee engagement; turnover intention; IT sector; India.
FinBERT and LSTM based novel model for Stock price prediction using technical indicators and financial news
by Gaurav Bathla, SUNIL GUPTA
Abstract: Stock price movement is highly nonlinear, volatile, and complex. Traditional machine learning techniques are employed by researchers for stock price prediction, but due to shallow architecture, adequate accuracy is not achieved. In this paper, recently introduced Bidirectional Encoder Representations from Transformers (BERT) and Long Short-Term Memory (LSTM) hybrid model is utilised for stock price prediction. BERT model is used for financial news sentiment analysis. The sentiment score is merged with technical indicators of stock prices. In our approach, FinBERT is used which is specifically trained on financial corpus. Stock market prices were highly fluctuated in March 2020 due to lockdown. Thus, it is essential to predict high variation which existing works have not experienced due to lack of availability of highly fluctuated dataset. In our approach, the effect of financial news on stock indexes is analysed. Experiment analysis validates that our proposed approach outperforms existing approaches significantly.
Keywords: financial market; stock market; deep learning; data analytics; BERT; long short-term memory; LSTM; MAPE.
Modelling and Forecasting Intraday Volatility with Range Based GARCH Models for Indian Stock Market
by Moonis Shakeel, Himani Arya
Abstract: This paper focuses on the range-based volatility estimations with standard GARCH, EGARCH and TGARCH models to analyse how the performance of the models changes in different range-based analysis. The idea is to check the suitability of these models on a unique 7 months 30-minute intraday Nifty data with different measures of range-based volatility measures such as Parkinsons, Garman-Klass, Garman Klass-Yang Zhang and Yang Zhang for their appropriateness on the Indian stock market. Robust empirical analysis and comparisons give two significant performance-based results: 1) range-based volatility forecasting models appear to perform better as compared to the return-based models; 2) asymmetric GARCH models are found to be a better fit for the Indian stock market vis- à-vis the basic GARCH model. Another major outcome shows that the GKYZ volatility estimator comes out to be the best for accurately forecasting the current period volatility of the Indian stock market with having the minimum forecast error. Also, the positive size test significance suggests that the magnitude of the good news has a larger impact on volatility as compared to the impact of the magnitude of the bad news for Nifty 50.
Keywords: volatility forecasting; GARCH; TGARCH; EGARCH; range-based estimations.
Leadership Styles and Innovative Work Behavior: The Role of Work Engagement
by Udin Udin
Abstract: Organisations face many challenges that should be met to accomplish a competitive advantage. Hence, this studys fundamental purpose is to test the leadership styles effect (i.e., transactional and transformational) on innovative work behaviour by examining the work engagements role in the stone milling companies located in Central Java Indonesia. The questionnaire targeting 200 respondents resulted in 107 appropriate questionnaires with a response rate of 53.5%. To test the proposed research hypothesis, a structural equation model based on SmartPLS 3.0 was utilised. The results showed that transactional and transformational leadership positively and significantly affected innovative work behaviour and work engagement. In addition, this finding also reinforces the argument offered that work engagement plays as a mediator in the association between transactional and transformational leadership on innovative work behaviour.
Keywords: leadership styles; work engagement; innovative work behaviour.
A Hypothesis on Rationalizing Decisions by Constructing Personal Realities
by Mahmoud Askari, Ghaleb A. El Refae
Abstract: In this paper, we propose a hypothetical model to show how people construct their realities, and how they subjectively rationalise their decisions and actions. We hypothesise that when making individual decisions, what matters is the reality as perceived by individual decision makers, regardless of the objective or subjective approach to reality. The paper attempts to study the link between perceived reality (subjective reality), and how people rationalise their decisions and actions. The paper sheds light on how people know what they know, and how that might affect their sense of rationality when making decisions. The paper explains that people come across knowledge in a daily basis, and that they decide to accept, reject, or adjust that knowledge, using their subjective validation process that is guided by their experiences, biases, and beliefs.
Keywords: perceived reality; subjective validation; construction of personal reality.
A Universal Financial Inclusion Index covering Banking, Insurance and Pension Services in India
by Anand Pandey, Ramasamy Murugesan
Abstract: To create a universal social security system for all Indians, especially the poor and the under-privileged, three social security schemes namely, Pradhan Mantri Suraksha Bima Yojana, Pradhan Mantri Jeevan Jyoti Yojana, and Atal Pension Yojana were initiated by the Government of India in 2015. In the paper, a new universal financial inclusion index (FIU) covering banking, insurance, and pension parameters in India are developed. Given that all parameters used in financial inclusion index have separate units, all parameters are normalised using the min-max method of normalisation. The Euclidean distance method is used to assess the distance between any two points in an n-dimensional space. FIU is compared to the financial inclusion index covering banking parameters only. The FIU is a multi-dimensional index that captures values of various banking, insurance, and pension dimensions on the scale of 0 to 1, where 0 indicates complete financial exclusion and 1 indicates complete financial inclusion.
Keywords: universal financial inclusion; PMJDY; PMJJBY; PMSBY; APY; multi-dimensional index.
The impact of ISO 26000 social responsibility standard adoption on Stock Market Liquidity: Evidence from Saudi Arabia
by Hisham Barrak, Mounir Sarraj, Sourour Ben Saad, Aymen Ajina
Abstract: This paper aims to investigate the relationship between disclosure about corporate social responsibility through ISO 26000 and stock market liquidity in Saudi Arabia. The study uses a sample of 122 listed firms on the Saudi stock market between 2012 and 2017. Our result shows a positive association between CSR disclosure and stock market liquidity. Specifically, while the CSR index is correlated negatively with quoted and effective spreads, illiquidity ratio is positively correlated with trading volume. So, a higher level of CSR disclosure tends to ameliorate the illiquidity of Saudi firms. These findings are in line with the stakeholder theory and the legitimacy theory that a high level of CSR disclosure is viewed as a positive signal to setup confidence between stakeholders and attract investors to exchange in a transparent market. According to our findings, Saudi regulators should consider the level of CSR disclosures as a serious component to improve market liquidity.
Keywords: corporate social responsibility; CSR; ISO 26000; stock market liquidity; the opportunistic disclosure hypothesis; legitimacy theories; Saudi Arabia.
New Framework as Risk-Vulnerability Index (RVI) in Commercial Banking System
by Dayanand Pandey, Surender Kumar
Abstract: Risk management in commercial banking has been facing great challenges due to dynamic changes occurring both within and outside the system. This study focuses on the adoption of new frameworks to explain the measurement of risk in the commercial banking system. The study introduces new parameters of vulnerability in combination with external risk to gauge the potential threat of a commercial bank. The study presents a theoretical framework to construct a risk-vulnerability index (RVI), in the context of commercial banking operations. For this purpose, the existing parameters of risk (as per Basel III), financial stability indicators of commercial banks, and expert opinions are taken into consideration. It may help stakeholders detect potential threats more precisely and enable banks to take corrective measures in time to avert the threat.
Keywords: risk; vulnerability; framework; commercial banks; potential threat; Basel III; risk-vulnerability index; RVI.
ASYMMETRIC VOLATILITY SPILLOVERS BETWEEN BITCOIN, OIL AND PRECIOUS METALS
by Houda BenMabrouk, Imen BenKhalifa
Abstract: This paper examines the asymmetric spillovers between Bitcoin, oil and four precious metals (silver, gold, platinum and palladium) on daily returns from 18 August 2011 to 2 October 2019. Using a modified version of the Dieblod and Yilmaz (2012, 2014) index and a similar approach to Barunik (2017), our results indicate slight volatility spillovers between the whole system. Moreover, the results show that gold is the most influential market since it shifts the highest proportion of volatility. Furthermore, we find that oil, Bitcoin and platinum can serve as a hedge and a diversifier as they are neutral in terms of spillovers. Moreover, we find evidence of asymmetric volatility spillovers since good spillovers dominate bad one, which proves the optimistic mood of the whole system. More interestingly, our results shed light on the ability of Bitcoin, the digital gold, to serve as a hedge and diversifier in both good and bad innovations.
Keywords: volatility spillovers; asymmetric volatility; spillovers; Bitcoin; oil; precious metals; good innovations; bad innovations.
Revival of the Waqf-based Takaful Model in Malaysia: Issues and the Way Forward
by Muhammad Ikhlas Rosele, Abdul Muneem, Abdul Karim Ali, Noor Naemah Binti Abdul Rahman, Nor Fahimah Binti Mohd Razif
Abstract: This study finds that the waqf-based takaful model ought to be implemented in Malaysia to eliminate some issues related to the current practice of tabarru (donation), waklah (agency), and murabah (profit-and-loss sharing) within the takaful system. There are, however, legal issues, related to waqf-based takaful that should be solved through a proper and comprehensive waqf (endowment) act by the authority. Otherwise, a subsidiary of the State Islamic Religious Council may act as a takaful operator providing waqf-based takaful services. Above all, the takaful operator is required to establish a Sharah-compliant mechanism for managing the fund while strictly avoiding the risk of losing the capital of the waqf fund and providing the takaful services as needed by the participants. Nevertheless, some constraints and challenges for the implementation of the waqf model in Malaysia may remain, and such constraints should be addressed by all parties involved in order to make this takaful model a reality in Malaysia.
Keywords: takaful; takaful model; waqf; cash waqf; tabarru; Malaysia.
CRM purchase intentions and attitude toward the brand: Exploring fit, longevity, firm motives, brand attractiveness and moderating role of WOM
by Suraj Shah, Maurvi Vasavada, Mahendra Sharma
Abstract: Cause-related marketing (CRM) phenomenon consists of three integrated components (cause, company and consumer) and is a widely recognised promotional strategy adopted by numerous Indian organisations. CRM activity by a company involves engaging with a charity organisation yielding mutual gains for cause, company and consumer. In first phase of the proposed theoretical framework, we investigate the impact of fit, longevity, firm motives, and brand attractiveness on attitude toward brand and in second phase, we further examine the impact of attitude toward brand on CRM purchase intention. Moreover, we investigate the moderating role of word-of-mouth (WOM) and its impact on attitude toward brand and CRM purchase intention. This study would aid CRM marketers to frame promotion strategies based on the understanding of fit, longevity, firm motives and brand attractiveness in the CRM context. The insights would help the marketers to design an effective campaign and influence the behaviour intentions of CRM consumers.
Keywords: cause-related marketing; CRM purchase intentions; attitude toward brand; fit; longevity; firm motives; brand attractiveness; word-of-mouth; WOM.
Productivity Improvement in Stitching Process: A Six Sigma Case Study of Footwear Industry
by Indu Uprety
Abstract: This paper introduces the concept of Six Sigma in footwear industry. Various Six Sigma tools and techniques have been applied for measuring and analysing the reasons for defects in the shoe-making process. DMAIC was applied in the footwear manufacturing industry and sigma level observed was 3.77. The efforts have been made to reduce the defects and improve the sigma level with the help of Six Sigma DMAIC methodology. However, further improvements in the process are subject to following the various control measures suggested in the paper. With the help of general factorial design and Taguchis experiments, the key influence factors of the optimal combination for cooling time, temperature, viscosity have been obtained to analyse their effect on adhesive strength of the material used in the shoe-making process. Key techniques used in the analysis are Pareto analysis, cause and effect diagram, nested ANOVA, Duncans test and Taguchis design of experiments (DoE).
Keywords: DMAIC; process improvement; Six Sigma; Pareto analysis; Duncans test; nested ANOVA; Taguchis design of experiments; design of experiments; DoEs.
The effects of reductions in working hours on automation
by Ji Hyeon Ma, Jung Joo La
Abstract: This study uses a simple model to empirically analyse how reductions in working hours influence automation in the labour market. Previous studies focus on analysing the effects of reductions in working hours on factors such as actual working hours, wages, employment, and life satisfaction. We use panel data from 25 Organization for Economic Cooperation and Development countries over the 2011 to 2017 period. Our empirical findings show that a 1% decrease in the working hours of simple labourers increases automation by 1.13% to 1.15%.
Keywords: working hour reduction; automation; simple labourers.
Exploring UAEs female leadership styles in the digital era: Motivators and barriers
by Wejdan Farhan, Iffat Chaudhry, Jamil Razmak, Ghaleb A. El Refae
Abstract: Womens participation in decision-making roles is increasing in the patriarchal society of the UAE. An empirical investigation has been undertaken to determine the differences in leadership styles adopted by women compared with those adopted by men in both the public and private sectors of the UAE, as well as the motivators and barriers faced by women in their leadership roles. A mixed-method approach survey and interviews was used to collect data from leaders working in various government organisations and private businesses. Responses from 409 surveys and 24 interviews were analysed using SPSS and thematic analysis, respectively, to test the study hypotheses. The survey found that women leaders mostly adopt a transformational leadership style along with a contingent reward strategy (transactional) to lead employees at their respective workplaces. They mostly avoid a passive approach to leadership compared with their male counterparts. Interviews with female leaders identified how self-development, social impact, and collaborations motivate them, and how a lack of authority, vigilance, and gender stereotypes inhibit them in their leadership roles. The study results have implications for industrial practitioners as well as policy-makers in the UAE Government departments concerned with womens empowerment.
Keywords: female leaders; female empowerment; transactional; transformational; laissez-faire; barriers; United Arab Emirates; UAE.
Controls and Processes to Prevent Employees from being bribed by Third Parties
by Marianne Rexer, Woojun Lee, Dawn Burdsall
Abstract: This study focuses on employee bribery by third parties and summarises the state of third-party anti-bribery processes and the companys confidence to assess third-party bribery and corruption risks. A qualitative research approach was utilised to interview internal auditors and managers and asks open-ended questions to understand the internal controls in place to prevent or detect the bribery of employees, the internal audit process, and the types of frauds witnessed. The findings show all respondents acknowledge the risk of employee fraud and bribery by third parties and utilise internal audits along with preventive and mitigating controls to manage risks. Based on the findings, we identified themes that mirror the assessment of risk that third parties could bribe employees and the development of controls to limit the employee with or without regard to third parties.
Keywords: internal audit; third party; bribery of employees; corruption.
THE ROLE OF IMPLIED VOLATILITY IN VOLATILITY COMBINING FORECASTS
by Jen Sim Ho, CHOO W.E.I. CHONG, BOON SHUI HOOI, W.A.N. CHEONG KIN, Yuruixian Zhang
Abstract: This study explores the role of implied volatility (IV) in volatility combining forecasts for S&P 500 and DAX markets. A range of GARCH models, ad hoc models and STES models were developed to identify the best performing model that served as a base model for subsequent combining process, of which GJRGARCH model appeared to be the superior model among all the individual models. A total of eight combining models based on Bates and Granger as well as Granger and Ramanathan theories were designed to examine the efficiency of IV in the volatility combining forecasts. The empirical results suggest that IV improves the predictive power of volatility combining forecasts, but the assigned weights were seen less inclined to IV. The inclusion of constant and unconstrained models performed the best. Besides, the study has also addressed the robustness of STES models in volatility forecasts. MCS tests were conducted and further reinforced the superiority of the empirical results.
Keywords: implied volatility; volatility combining forecasts; GARCH; smooth transition exponential smoothing; STES.
The interaction among FDI, trade openness, and economic growth in Asian economies
by Must. Ayesha Shahrin, Saeed Sazzad Jeris
Abstract: This research analyses the correlation between foreign direct investment, trade openness, and economic growth in ten Asian nations from 1980 to 2019. ARDL bound and Granger causality tests have been utilised to evaluate both the short-run and long-run correlations among foreign direct investment, trade openness, and economic growth. The findings show that foreign direct investment and trade openness influence the growth of all economies in the long run except for the Philippines, Thailand, and Singapore. Trade openness and foreign direct investment are also crucial to boosting the economy in the short term. Also, trade openness has a short-term casual correlation with economic growth in Bangladesh, China, and Thailand, where the trade of the Korea Republic, Singapore, and Hong Kong largely depends on GDP growth in the short-run. However, trade openness does not have a long-run association with economic growth in Asian countries apart from Thailand and Hong Kong.
Keywords: economic growth; foreign direct investment; trade openness; ARDL; bound test; Granger causality; FDI.
The impact of Economic Policy Uncertainty on the real exchange rate: Evidence from the UK
by Paula Moldovan, Sérgio Lagoa, Diana Mendes
Abstract: The world economy has been punctuated by uncertainty in recent years, as a result of the 2008 subprime crisis, the European sovereign debt crisis, Brexit, and the 2016 US presidential elections, to mention but a few of the reasons. This study explores how the UK real exchange rate reacts to economic policy uncertainty (EPU) shocks using monthly data for the period 1998 to 2020. We contribute to the literature by identifying the long-run and short-run impacts of EPU using a cointegrated ARDL model, and by studying a country that has been through periods of both relatively low and high uncertainty. Results confirm that EPU has an important effect in the long run by depreciating the exchange rate. In addition to urging policymakers and regulators to keep policy uncertainty to a minimum as a way of sustaining exchange rate stability and thus promoting long-term economic growth, further evidence is provided on exchange rate fundamentals.
Keywords: real exchange rate; economic policy uncertainty; EPU; ARDL model; Brexit; UK.
Purchase Intention and Attitude towards Advertisements on Instagram - An Empirical Study using Instagram Stories
by Augustin Suessmair, Lisa-Julie Woo
Abstract: Since regulations require paid promotions to be disclosed, consumers awareness of advertisements has changed. That requires more focus on assessing influencing factors when it comes to evaluating the effectiveness of an advertisement. This empirical study investigates the effectiveness of advertisements based on the type of influencer and product illustration on an Instagram Story. An experimental design with a total of 308 participants is used to examine consumers attitudes toward advertisements and purchase intention. In addition, the mediating role of source credibility is investigated. The findings show that a product, advertised in a context-based setting on an Instagram Story, has a positive effect on consumers attitude towards the advertisement and their purchase intention. There is no significant effect in the use of a micro-influencer compared to a macro-influencer. In terms of advertisement effectiveness, source credibility can be identified as a mediator for positive consumers responses.
Keywords: influencer marketing; Instagram Story; influencer type; product illustration; advertising.
PERFORMANCE EXPECTANCY OF GENERALIZED AUDIT SOFTWARE: A DEVELOPING COUNTRY PERSPECTIVE
by Rindang Widuri
Abstract: This study investigates the perceived benefits to Indonesian audit firms using generalised audit software (GAS). This studys results are based on semi-structured in-depth interviews with external auditors from firms of all sizes. The finding of this research shows that the GAS utilisation affects the competitiveness, improves efficiency, increases audit quality, productivity, and uniformity as the performance of GAS usage shown from several interviewed participants involved in this study. This study contributes to providing insights into GAS usages perceived benefits in the external audit setting in firms of all sizes in a developing economy context.
Keywords: audit software; generalised audit software; GAS; use; audit quality; Indonesia; computer-assisted audit techniques; CAATs; audit technology; external auditor.
The Impact of Investor Sentiments on Stock Returns and Volatility: Do Economic Forces and Herding Behavior Matter
by Sana Masood, Umar Farooq, Mosab Tabash, Suhaib Anagreh
Abstract: This study examines the relationship between investor sentiments, stock returns and stock volatility. Herding behaviour and macroeconomic forces are also used as explanatory variables in this study. Stock returns and stock volatility are used as dependent variables. The main objective of this research is to examine the impact of investor sentiments, macroeconomic forces, and herding behaviour on stock returns and stock volatility. The data of the non-financial sector of Pakistan has been collected from 2010 to 2019. Panel quantile regression has been used for determining the relationship among dependent and independent variables of the study. Different quantiles i.e., 0.25, 0.50 and 0.75 are used for desired results. Results of this study suggest that investor sentiments affect stock returns and stock volatility at different quantiles. Macroeconomic forces also affect stock returns and volatility at different quantiles. This research will aid managers, and policymakers in future investments.
Keywords: investor sentiments; macroeconomic forces; stock volatility; stock returns and herding.
The impact of organisational structures on management compensation packages and investment decisions - a principal-agent approach investigating formula apportionment and separate accounting
by Hülya Çelebi
Abstract: This study investigates managerial effort choices, compensation and investment decisions by differentiating between: 1) centralised and decentralised organisational structures; 2) corporate income taxation schemes [separate accounting and formula apportionment (FA)]; 3) different FA schemes, which has not been undertaken hitherto. A principal-agent approach of a LEN model is applied within the framework of a multijurisdictional entity. The outcomes reveal the neutral impact of separate accounting on investment decisions, agents efforts and compensation packages under both organisational structures, whereas investment decisions under centralised structures and management compensation packages (under both organisational structures) show distortions caused by FA. The extent of these distortions depends on the apportionment factors used and organisational structures. Interestingly, the Massachusetts formula signals that the formula allocation factors used not only distort firm-internal contracts on management compensation packages, but can also affect the extent of decisions delegated.
Keywords: organisational structures; principal-agent theory; formula apportionment; investment; nonlinear programming.
Decision-Making Modes and Decision-Making Biases. Improving decisions in escalation of commitment situations by triggering considerations
by Peter Kotzian
Abstract: Escalation of commitment is a persistent problem in managerial decision-making. Purpose of this study is an experimental test of an alternative debiasing strategy with regard to the continuation of failing, but also of successful projects. According to the dual processing approach to decision-making, biases are linked to operating in a spontaneous low-effort cognitive mode. Thus, one remedy is getting decision makers to shift in an elaborate mode of thinking. This experimental study investigated, whether calling for an explicit evaluation of benefits and risks before actors make their decision improves decision-making about a projects continuation in the sense that sunk costs are less relevant and available economic information is more relevant for the decision. Effects of triggering considered decision-making on successful and unsuccessful projects are investigated. The findings indicate substantial differences between considered and spontaneous decisions with decision makers actively considering projects before deciding actually making worse decisions.
Keywords: decision making; escalation of commitment; sunk cost bias; dual processing approach; system 1; system 2; decision quality; information usage; debiasing.
How Covid19 affected Academic Performance and Job Readiness in Higher Education
by Meryana Haddad, Yee Mei Heong, Habeeb Ur Rahiman
Abstract: COVID-19 pandemic has created a serious impact on human life in different ways and modes. Higher education is one such area where many students struggle to meet their intentions and be efficient in their studies. The current study aimed to investigate the impact of the pandemic on higher education academic performance and job readiness in the gulf region. A mixed-method research strategy was administered in performing the research. The quantitative data were collected employing online survey instruments from 1,750 respondents from various parts of the gulf region. The data were analysed by applying statistical tools like SPSS and AMOS and finding revels that the COVID-19 pandemic adversely impacted higher education in the Gulf. The study also identified that assessment and evaluations, students engagement and overall academic performance, and job readiness were the most adversely affected areas due to pandemics. The conclusion of the research will support government and higher education facilitators to examine and implement guidelines for teaching and learning in disaster situations.
Keywords: COVID-19; anxiety; job readiness; assessment; academic performance.
Multidimensional Energy Poverty and its Determinants
by Muhammed Abrar Ul Haq, Najma Rasheed, Abid Rashid Gill, Qaiser Munir
Abstract: The current study aims to identify the factors affecting multidimensional energy poverty in Pakistan. For this purpose, information about 2013 households has been taken from the Pakistan Demographic and Health Survey 2017 to 2018. The study uses multidimensional energy poverty index as a dependent variable composed of five dimensions: communication facilities, entertainment/education, household appliances, lighting, and cooking. The logistic regression technique has been applied to scrutinise the results for Punjab and its nine divisions separately to analyse the factors affecting Punjabs multidimensional energy poverty index. Empirical findings indicate that age of the head of the household, no education, incomplete primary, complete primary, incomplete secondary, wealth statuses of the families, and rural residence are statistically significant factors affecting multidimensional poverty in all nine divisions of Punjab. The study recommends that the government frame specific policies to improve education levels and create more opportunities for wealth generation that ultimately affect energy poverty.
Keywords: multidimensional energy poverty; education of household head; household wealth index; place of residence; Pakistan.
Financial knowledge and Financial Behavior Among Micro Business: the Mediating Role of Pro-growth Mental Accounting
by Wirawan Endro Dwi Radianto, Tommy Christian Efrata, Liliana Dewi
Abstract: This study examines the effect of financial knowledge, pro-growth mental accounting, and financial self-efficacy on financial behaviour. A model is developed to solve research gaps regarding the relationship between financial knowledge and financial behaviour, which has been inconsistent and weak. The number of respondents is 314 micro businesses and the data analysis method used is structural equation method. The finding of this study is that pro-growth mental accounting has a greater effect than financial self-efficacy on financial behaviour. The pro-growth mental accounting mindset makes micro-business manage their finances more carefully. Another finding is that pro-growth mental accounting encourages the creation of reserve funds while increasing the chances of achieving its financial goals. Micro business whose financial management is simple has a greater chance of having financial resilience in the future.
Keywords: pro-growth mental accounting; financial knowledge; financial behaviour; financial self-efficacy; micro business.
Conditional Volatility and Correlations Between Sukuks, Stocks and Gold in the GCC region
by Walaa Hammad, Qaiser Munir, Tamara Teplova, Muhammed Abrar Ul Haq
Abstract: Financial markets around the world have suffered significantly during the current COVID-19 pandemic. This study presents an important view of the predictive capacity of COVID-19 for the correlation between Islamic bonds, equity markets, and precious commodities in the GCC region. Specifically, this study investigates whether the volatility and co-movements behaviours between Sukuk, conventional stocks, Islamic stocks, and gold are correlated before and during the pandemic. Our analysis uses a dynamic conditional correlation (DCC) multivariate generalised autoregressive conditional heteroskedasticity (MGARCH) model from the period 30 August 2013 to 31 January 2022. Our results suggest that there is a strong correlation between Sukuks, conventional stocks, and Islamic stocks before and during the crisis. However, we have observed that the correlation decreases during the pandemic. With regards to correlation, Sukuk and conventional stocks along with Sukuk and Islamic stocks maintained a low correlation, while the conventional and Islamic stocks have a high correlation.
Keywords: Sukuk; stock markets; gold; dynamic correlations; conditional volatility; DCC-MGARCH.
Portfolio Diversification and Dynamic Hedging among BRICS stock markets and Cryptocurrencies
by Audil Rashid Khaki, Nasser Elkanj, Somar Almohamad, Sara Omran, Mohamed M. Sraieb
Abstract: This present study explores the potential of cryptocurrencies in the diversification of a portfolio of rather integrated financial markets or instruments, such as BRICS by employing the mean-variance optimisation approach and the higher-order moments approach. The results indicate that while the theoretical implication of both the mean-variance approach and higher-order moments approach point in the same direction, the latter is more efficient in capturing the asymmetry and the tail risk of the returns, besides the investors risk-aversion. The results suggest that ETH is the most popular cryptocurrency for portfolio diversification followed by BTC, almost receiving the same asset allocation in different portfolio optimisation strategies. The results also indicate that the potential of cryptocurrencies in portfolio diversification is rather marginal or limited to a risk-averse investor while they may offer an alternative investment avenue for risk-seeking investors. While cryptocurrencies may promise to offer a considerable diversification potential, the allocations to cryptocurrencies must conservatively be made, given the explosive price behaviour of cryptocurrencies in recent times.
Keywords: cryptocurrencies; portfolio optimisation; FINTECH; BRICS; portfolio diversification.
Synergetic Impact of Knowledge Management and Access to Finance over Open Innovation for Performance of SMEs
by Muzaffar Asad
Abstract: Access to finance has widely been accepted as a mean of gaining performance for SMEs, likewise, knowledge management for achieving performance is gaining importance especially in the SMEs of developing economies. Similarly, role of open innovation has also been well established in several prior studies, however, the major contribution of the research is the identification of mediating role of open innovation between resources and performance. For testing the developed framework based on knowledge management theory and resource-based view, the author used structural equation modelling. The study was cross-sectional survey design has been applied using a sample of 364 owners and managers of SMEs. The findings confirmed that both the resources create synergy and significantly enhance performance in the presence of open innovation. The study along with supporting knowledge management theory and resource-based view of the firm also holds significant policy implications.
Keywords: knowledge management; access to finance; open innovation.
An analysis of shock and volatility spillovers among Vietnamese and BRICS equity markets
by Fadia Al Hajj, Duc Nguyen Nguyen, Sara Omran, Tonguc Cagin, Virginie Nahas
Abstract: Globalisations of financial markets have contributed to the Connectedness among cross border equity markets. BRICS and Vietnam Stock Markets are closely related and are believed to be interdependent, an interdependence that is expected to increase in times of crisis. The aim of this paper is to investigate the volatility spillover within these markets by detecting the impact of the GFC and COVID-19, separately. The main contribution is to present a comparative analysis of the impact of both crises on stock markets amalgamation. The research employs daily stock prices for a sample of Vietnam and BRICS countries. The study considers two periods, GFC period (from January 2007 to December 2009) and COVID-19 period (from January 2019 to December 2021). The data utilised in this analysis are MSCI indices obtained from the DataStream. The applied tests are the generalised Diebold and Yilmaz (2012) to measure the returns and volatilities and generalised impulse response function of the innovation accounting analysis of Koop et al. (1996) and Pesaran and Shin (1998). The results have detected an increasing connectedness and spillover among Vietnam and BRICS during COVID-19 as compared to GFC with the strongest relationship between India, China, and Vietnam.
Keywords: COVID-19; GFC; Vietnamese stock market; BRICS; portfolio diversification; financial connectedness.
Towards Sustainable Bank Bailouts
by Sara Al Balooshi, Sara Al Faihani, Rabab Ebrahim
Abstract: This paper investigates the viability of using Islamic financing products in government bailout schemes. Empirically, we examine the association between bank sustainability and the different Islamic financing products, equity-based and debt-based. We use a multilevel model and an unbalanced panel hand-collected banking data of GCC banks over the period 2006 to 2016. The findings show that the Islamic equity-based financing products (profit-loss-sharing and Islamic futures-like products) significantly promote bank sustainability, while the debt-like products (Sukuk and Fixed-income) will lead to more fragile banks. These findings will be of interest to central banks and policy makers while considering bailout options for banks. The bailout funds should be regulated and directed toward Islamic equity-based financing products to maintain sustainability of the rescue funds, banking system and the general economy.
Keywords: bank bailout; equity; Islamic banking; profit-loss-sharing; sustainability.
Covid-19 Pandemic and Explicit Deposit Insurance Scheme: Analytical Study
by Mohamed Sayed Abou Elseoud
Abstract: The current study aims to evaluate the effectiveness of implementing an explicit deposit insurance (EDI) mechanism in maintaining the stability of the banking industry and regaining depositor confidence in Egyptian banks during the COVID-19 outbreak. Based on a review of the literature, the study created a questionnaire to test four hypotheses about the banking systems ability to meet the requirements for implementing the EDI system, as well as the expected effects of EDI on depositor confidence, deposit stability, and banking credit flexibility. The questionnaire was distributed to 130 commercial bank branches located in the four largest governorates in Egypt. The survey was conducted from July 2020 to January 2021. The findings of the study show that the Egyptian economy meets the requirements for implementing EDI. As a result, implementing this program will shield Egyptian banks from internal and external financial volatility, stabilise deposit volume, and encourage the saving of more cash as a result of growing public confidence in the banking system. Consequently, the paper recommends for how to implement the EDI system, which could be helpful to Egyptian decision-makers when they do so.
Keywords: explicit deposit insurance; banks; COVID-19; survey; Egypt.
Price Inflation in the Agricultural Sector During the Covid-19 Pandemic: Is it a Supply or Demand Issue
by Muhammad Ather, Omar Masood, Bora Aktan Aktan, Mohamed Sayed Abou Elseoud
Abstract: The current study intends to investigate the imbalance between agricultural supply and demand during the COVID-19 outbreak in the US economy. The time frame is determined by the vaccination rollout, which would start at the end of 2020 and run through August 31, 2021. The studys dependent variable is the Bloomberg Agriculture Index, while its independent variables are macroeconomic indicators, commodities indices, transport indices, the Infectious Disease Equity Market Volatility Index (IDEMV), SPY index, and ten-year treasury. This article utilises the autoregressive distributed lags (ARDL) technique, the variance inflation factor, and the cumulative sum (CUSUM) analysis. According to the studys findings, there is a correlation between demand and the influence of the agricultural index, and the total market is affected differently by economic stimulus policy than it is by the agricultural index. These insights might be beneficial for future studies and policy decisions.
Keywords: agriculture index; IDEMV; marine index.
The UAE Education Reform: Opportunities and Challenges
by Meryana Haddad, Yee Mei Heong, Abdul Rasid Bin Abdul Razzaq, Tee Tze Kiong
Abstract: As one of the worlds wealthiest and newest nations, the UAE is now striving to become a leading provider of quality education. There has been little research conducted on the UAEs education reform efforts. A number of studies have shown that countries face difficulties in aligning market-driven academic goals with dominant cultural paradigms. As a result of switching from historically lucrative petroleum industries, their academic success may require more improvements to sustain and develop their educational level. In this study, we conduct literature review research utilising concepts explored in comparative education to examine how the government is approaching reforms and suggest future research areas. This study provides some futures could help policy makers and government to enhance and achieve the vision of UAE.
Keywords: education; reform; United Arab Emirates; UAE.
How the COVID-19 pandemic affected the investment characteristics of Indonesian government bond market?
by Alexander Ganchev
Abstract: The research paper investigates the investment characteristics of the Indonesian government bond market during the COVID-19 pandemic. The study reveals that for the investigated period the yield on Indonesian government bonds has many of the well-studied characteristics that are present in the developed debt markets. However, in this case there are some specifics, such as a strong correlation along the entire yield curve and inhomogeneous volatility of medium-term yields. The empirical findings also show that for the study period some of the medium-term Indonesian government bonds are systematically incorrectly priced. Despite this fact the Indonesian government bonds as a whole are very good investment in the COVID-19 environment because they offer stable and relatively high yield. Moreover, due to the characteristics of the yield curve dynamics, the portfolios of Indonesian government bonds could easily be hedged against interest rate risk by using simple tools such as duration or modified duration.
Keywords: fixed-income securities; bond yield; yield to maturity yield curve; Indonesian debt market; COVID-19.
Research Opportunities in Supply Chain Management during COVID-19 Outbreak: Exploring through Review and Bibliometric Analysis
by Ratri Parida, Jaspreet Kaur, Sonia Singh
Abstract: The spread of coronavirus (SARS CoV-2) which is otherwise known as COVID-19 has a major effect on businesses, particularly disrupting the supply chains (SC). With the advent of the black swan event, many research articles were published about the execution of short-term plans that may mitigate the associated SC risks. This article summarises and presents a critical assessment of 367 articles collected from the Scopus database that is published in the past year (2020-2021). The insightful findings in terms of citation, co-citation, influential authors, contributing countries, key research areas through cluster analysis, etc. are presented with the help of a bibliometric approach. The analysis also shows the tools and techniques being used to mitigate SC issues. The proposed research framework will help the practitioners and academicians to fully understand the complexity among SC partners due to the pandemic thereby proposing a response roadmap exploring potential research avenues.
Keywords: COVID-19; bibliometric analysis; supply chain resilience; sustainability; citation and co-citation analysis.
Two-speed or three-speed recovery in post-crisis and post-pandemic economy: regional and sectoral development
by Astra Auzina-Emsina, Velga Ozolina
Abstract: Balanced recovery is a key factor to ensure the sustainable economic performance in the post-crisis period. Two-speed recovery pattern is already observed. Three-speed recovery represents the most likely pattern of recovery in the majority of the EU countries in the post-COVID era due to the common dramatic decline in transport and tourism, relative minor impact on large part of essential manufacturing and services, moderate impact on other industries that adopted online and distant-working solutions. It is believed that air transport recovers quickly, minor increase can be foreseen in boomed courier and postal sector, and stability in other transport industries. The findings argue that urban areas are shocked more as modelled transportation sectors development scenarios reveal faster recovery in urban (especially in metropolitan) regions compared to rural areas. Obtained results are valuable for policy makers and government for modifying the recovery plans to stimulate balanced recovery, reducing potential poverty risks and depressed regions.
Keywords: recovery; two-speed economy; three-speed economy; post-crisis; post-COVID; post-pandemic economy; economic modelling; input-output.
The Impact of Corporate Social Responsibility on Corporate Financial Performance in India: An Investigation using Data Envelopment Analysis
by Dipanita Deb, Philippe Gillet, ANUPAM DE
Abstract: The paper emphasised the technical efficiency of Indian corporates and explored the drivers of high efficiency. This study applies multiple methods, i.e., data envelopment analysis and free disposal hull, to observe the efficiency rankings of the Indian companies. In the second stage, we perform a truncated regression analysis to validate our results on the association between corporate social responsibility and corporate financial performance. The findings suggest that 20 corporates from 87 corporates are technical efficient (TE = 1) in all frontier approaches. Further, it has been observed that the three pillars of corporate social responsibility (i.e., environment, social, and governance) positively correlate with efficiency. Furthermore, it has also been observed that all three pillars of corporate social responsibility are positively related to return on assets. The findings can be helpful for the stakeholders, policymakers, and management as a guideline for implementing corporate social responsibility practices.
Keywords: corporate social responsibility; CSR; environment; social; governance; ESG; financial performance; India.
Constructing the Agriculture Purchasing Managers Index in Taiwan Rice Industry
by Wen-Shin Lin, Yi-Ting Tseng, Tzong-Ru (Jiun-Shen) Lee
Abstract: This study takes the concept of Purchasing Managers Index (PMI) into consideration to construct Agriculture Purchasing Managers Index (APMI) in the rice industry. The purpose is to provide comprehensive and objective investment reference and economic conditions for agribusiness and government to make the decision. This study takes important crop in Taiwan, rice industry in 2016 as the case study. The data from the Council of Agriculture (COA) and Agriculture and Food Agency is used to construct APMI and formula using principal component analysis (PCA). The results indicated the result of APMI using PCA with four variables (productivity, price of paddy, planted area, and export quantity) has the highest correlated coefficient (r = 0.94) with revenue. The higher the correlated coefficient, the better the ability to use APMI to demonstrate economic status of industry. In conclusion, constructing the APMI formula using PCA could provide suitable investment months in the rice industry.
Keywords: Purchasing managers index; Principal component analysis; Diffusion index; Agriculture business.
Variables of the Harberger Triangle in the Financial Market
by Kristaps Freimanis, Maija Senfelde
Abstract: If there are no market failures, perfectly competitive markets will provide an accurate assessment of the risk/return profile of each financial instrument. Thereby identification of the financial market failures is important task to properly address the regulation aimed to minimize the deadweight loss arising from the market failures. In this paper authors review scientific literature and the speeches of the European Central Bank to reveal up-to-date financial market failures and propose variables to be used in the Harberger Triangle for deadweight loss assessment arising from market failures. Proposed variables cover insights revealed in the literature and central bank speeches analysis and are broadly available in most of the statistical databases, specialized databases or in the financial statements of banks.
Keywords: central bank speeches; deadweight loss; the Harberger Triangle; market failures.
Georgian Labour Market in Gender Prism: A Statistical Review
by Nino Abesadze, Nino Paresashvili, Rusudan Kinkladze, Ketevan Chitaladze
Abstract: It is true that there is a reduction of gender imbalance in the Georgian labour market, but the challenges in this area are still serious. The aim of the research was to discuss the peculiarities of the Georgian labour market in terms of gender, identify its main problems, conduct quantitative analysis using statistical methods and draw relevant conclusions. Both general and statistical, specific: statistical observation, grouping and analysis methods were used in the research. Gender imbalances in the Georgian labour market are decreasing. In the conditions of increased unemployment and reduced economic activity, it is noteworthy that the employment rates of women are increasing; As womens employment increases, so do their wages, but its magnitude is still significantly lower than that of men; Employment imbalances are pronounced in the territorial context, the difference is more pronounced in cities than in rural areas.
Keywords: employment; labour market; Georgia.
Attitudes toward social and environmental scoring system: Analysis of normative framing and individual influencing factors
by Dominik Ahrari, Augustin Suessmair
Abstract: Scoring systems do not only aim to assess individuals' social and environmental behaviour and predict their future behaviours, but also motivate people to engage in score-improving behaviours. This study aims to assess people's attitudes towards exemplary environmental and social scoring systems and investigate the extent individual factors and normative 'emphasise' framing affect people's attitudes towards environmental and social scoring systems. A quantitative online study was conducted in Germany with 237 respondents. Fictitious scenarios from scoring practice were used as attitude objects. The results show that environmental scoring was evaluated significantly more positively than social scoring by the study participants. The results also indicate that individual factors influence attitude formation. The results suggest that the individual utility of the respective scores could influence the acceptance of environmental and social scoring systems. Normative 'emphasise' framing and the personality trait of narcissism do not seem to be relevant influencing factors.
Keywords: environmental score; social score; consumer behaviour; sustainability; governance; public management.
Which nudges get support - A Quantitative Analysis of the Dimensions Transparency and Dual Process Theory
by Hannes Wissmann, Augustin Suessmair
Abstract: Policymakers have been increasingly interested in so-called 'nudges' which are behaviourally informed policy measures. The legitimacy and acceptability of nudging is controversially debated. In this paper, the acceptability of nudges was examined by the framework of Hansen and Jespersen (2013), which classifies nudges into four types by distinguishing on a dual process theory dimension and on an epistemic transparency dimension. An online questionnaire was developed in which 135 participants stated their support for the different types of nudges applied in the areas of health and sustainability. It was hypothesised that for both and across areas, the support would decrease in the following order: transparent system 2, transparent system 1, non-transparent system 1, and non-transparent system 2 nudges. The hypotheses could be confirmed for sustainability nudges and across application areas. Further analysis indicated that lower education, higher income, and higher environmental awareness are positively correlated with acceptance of sustainability nudges.
Keywords: nudging; public policy; behaviour change; sustainability; health; behavioural experiment.
Discrimination at work: Effects on Job Satisfaction and Organizational Commitment. An empirical study of the influence of perceived discrimination on work-related behaviours among people with and without a migration background
by Muhammed-Talha Topcu, Augustin Suessmair
Abstract: People with a migrant background constitute a significant part of German population. Their perceived discrimination at workplace is under-researched. This paper addresses the social factors, focusing on the perceived discrimination against migrants and persons in next generations with a migration background in Germany and supplements the rich body of literature on the economic aspects of immigration, e.g., Bhagwati and Srinivasan (1983), Borjas (1995), West (2011), and Bansak et al. (2015). An online survey with 239 participants was conducted. Results show that people with a migration background experience more discrimination than people without a migration background. However, people with a migration background are not per se less satisfied at work or less committed to their organisation. In addition, discrimination was found to predict lower job satisfaction and lower organisational commitment. Migration background is moderating the effect, while this was absent for job satisfaction. Further exploratory analyses show a significant mediation of the effect of migration background on job satisfaction through perceived discrimination.
Keywords: Discrimination; workplace; migration background; Germany; job satisfaction; organizational commitment.
Academic Institutional Merger: An Emerging UAE Experience
by Ghaleb A. El-Refae, Abdelhafid Belarbi
Abstract: The surmounting pressures of internationalisation of higher education along with the longing goal of obtaining recognition from an international accreditation body, the throttling efforts for getting advanced world academic ranking, and the strengthening mode of distance learning and working seem to pave the way for a new wave of university merger. In response to such a situation, UAE, which has opened its doors to transnational education under different forms has embarked on a university merger operation between three strong academic institutions: three of the leading Abu Dhabi higher education institutions opted in 2017 for the foundation of & #39;Khalifa University of Science and Technology'. The merger of Masdar Institute of Science and Technology, the Petroleum Institute (PI) and Khalifa University of Science, Technology, and Research (KU) integrates multi-disciplinary research and learning purposes across the fields of engineering, energy, and renewables. This paper aims to evaluate such operation because each institution carries its prosperous image reputation with a well-specific mission and goals and hurdles to major institutional transitional change.
Keywords: Internationalization of higher education; reforms; university merger; university governance; change management; quality of higher education and research.
A New Measure of Price Sensitivity to Interest Rate Changes
by Bohumil Stádník
Abstract: Macaulay's duration is a quantification of the sensitivity of the bond price to a change of its yield to maturity (YTM). Its main imperfection is that the change of YTM is very difficult to predict. To predict it correctly we would have to correctly predict the change of the entire shape of the zero-coupon curve. As we believe that predicting a shift of its short rate is easier than predicting the way the entire yield curve will be reshaped, we decided to quantify the sensitivity of the bond price with respect to the change of the short rate. Thus, the methodology is based on empirical quantification of the reshaping of the whole zero-coupon curve with respect to the change of its short rate, and based on such a quantification, we may then calculate the change of the bond price. The proposed measure is referred to as short rate shift duration.
Keywords: Short rate shift duration; SRS duration; Macaulays duration; interest rate sensitivity; zero-coupon yield curve reshaping.
Maturity or readiness? How to measure the levels of digitalisation? The case of Tâmega e Sousa Region
by Nelson Duarte, Carla Pereira, Davide Carneiro
Abstract: Digitalisation is mandatory for todays companies. Living in the Era of Industry 4.0, the phenomenon of digital transformation cannot be ignored. Intending to support manufacturing companies in their digitalisation processes, the present paper reflects the work that has been carried on, to support the digital transition for manufacturing companies in the region of Tâmega e Sousa. This region is considered to be an industrial region located in the North of Portugal, but lagging in terms of digital technology adoption. In a theoretical framework, it is expected to identify the most relevant factors to promote a successful digital strategy. Supported by a Science Design methodology, a platform was developed to support the measurement of the maturity or digital companies readiness levels. To collect the necessary data were performed questionnaires. First, in a face-to-face approach and later through the platform developed. The (preliminary) results are based on a sample of 53 companies (pilot test). From this data, it was possible to identify some trends: 1) some behaviours indicate that the region is still in the digitisation phase; 2) the digitisation focus is in the processes dimension; 3) even performing a digital transition, companies do not invest in in-house IT solutions.
Keywords: digital maturity; readiness; digital transformation; digital industry survey; SME; Tââmega e Sousa.
Digitalization of the economies of the Baltic States: Forecasting some development trends
by Inna Stecenko, Yulia Stukalina
Abstract: The pace of business digital transformation varies across the countries, which is determined by a few conditional factors that work differently in different countries depending on the countrys context. The aim of the research was to forecast the number of R&D specialists in the Baltic States and the number of internet-banking operations in five years to come for further forecasting the speed of digitalisation in the country based on the results of the previous study dedicated to the assessment of the factors influencing the digitalisation of economies in the Baltic States. For this purpose, a predictive analysis for forecasting the number of R&D staff and internet-banking operations in the Baltic States was done by performing multiple regression analysis (for the period from 2022 to 2028). The findings of the study are supposed to be utilised for the development of a policy for accelerating digitalisation of the economies of the Baltic States.
Keywords: data-driven economy; digitalisation; Baltic States.
Theoretical and empirical analysis of human capital in the context of the Polish labor market condition
by Katarzyna Brozek, Beata Poteralska, Joanna Labedzka
Abstract: The aim of the article was to identify statistically significant determinants of human capital influencing the condition of the labour market in Poland. The resources of public statistics were used to collect the empirical data. The collected data was developed using the technique of estimating the structural parameters of the regression function using the classical method of least squares (LSM). Due to the diversity of human capital factors, four thematic areas were identified, defined by 11 predictors describing the attributes of human capital. All the variables turned out to be statistically significant and had a positive effect on the improvement of the labour market condition in Poland, measured by the unemployment rate. The practical implication of the study was to obtain information about the significance level of the studied variables. This allowed us to conclude which attributes of human capital have the greatest impact on the situation on the labour market.
Keywords: human resource management; labour market; statistical and econometric analysis; Polish economy.
Examining the dynamic linkages between the banking sector activities and the Economic growth of Oman: Evidence from ARDL Approach
by Naushad Alam, Md Shabbir Alam
Abstract: Banks serve as a channel for successfully mobilising financial resources from the surplus sectors for efficient allocation to the deficit sectors for profitable investment that would then contribute to economic development. As financial intermediation metrics, this research analyses yearly time series data for bank deposits and credit to the private sector from 1972 to 2019. The autoregressive distributed lag (ARDL) cointegration test is applied based on the augmented Dickey-Fuller unit root tests for stationarity to determine the long-term influence of financial intermediation on economic growth. Furthermore, by estimating the error correction model, the research also evaluates the short-run link between financial intermediation and economic growth. The findings indicate that neither bank deposits nor credit to the private sector significantly influences long-term and short-term economic growth. Therefore, the study recommends introducing banking policy changes to reorganise the banking sectors for Omans diversified and sustainable economic growth to realise Vision 2040.
Keywords: bank deposit; bank credit; GDP; autoregressive distributed lag; ARDL approach; Oman.
The Impact of Technology on Economic Growth in Turkey
by Merve Ercan, Dilek Temiz, Aytaç Gökmen
Abstract: The Turkish economy has been suffering from trade imbalance for a long time. Exporting high value-added products will diminish Turkey's dependence on foreign resources for capital and imported products. At the same time, it may be possible to divert more resources from gross domestic product (GDP) to R&D funds. Appropriate and efficient usage of technology will help companies innovate and find new areas of employment. As a result, the Turkish economy may have a better chance of obtaining a sustainable economic growth for the longer term. This study concludes that increased R&D expenditures leads to a rise in technology and this in turn contributes positively to economic growth. The results obtained from the study show that technology affects Turkey's economic growth. Therefore, Turkey needs to work harder in the field of technology in order to achieve sustainable growth. Improving the situation and quality of research and development activities in Turkey, encouraging research and development investments by both the government and the business sector should be priority reform movements for Turkey. Policy makers should support science and technology, make institutional arrangements for intellectual property rights and raise the level of education, and make arrangements to increase R&D spending.
Keywords: Technology; Total R&D Expenditure; Economic Growth; Endogenous Growth Models; Turkey.
Fundamental Breach of execution of the Off-plan Sale Contract According to Law No. (3) of 2015 concerning the regulation of the real estate sector in the Emirate of Abu Dhabi - A Comparative study
by Ali Hadi Al-Obeidi
Abstract: Contrary to the general rules established in the UAE's Civil Transactions Law, Article (17-1) of Abu Dhabi's real estate sector law, stipulates: either party can end the contract under a unilateral will without referring to the judiciary if there is a fundamental breach of the contract by the other party. Since the UAE legislation is devoid of any statement in this regard, the International Sale Contract Rules were used. Specifically, Article (25) of the United Nations Convention on the International Sale of Goods (Vienna 1980) and English Law. To achieve this purpose an analytical approach towards Article (17) was implemented, and the Article compared to the international sales texts. This researchs Crucial findings are the precise definition of a contract's fundamental breach, and the specific conditions required to fulfill this breach. This study contributes to existing research by recommending specific amendments on Article (17-1) and Article (25) Vienna Convention.
Keywords: Fundamental breach; Real estate sector; Abu Dhabi Law; The United Nations Convention on Contracts for International Sale of Goods; Vienna 1980; English Law; off-plan sale.