International Journal of Economics and Business Research (37 papers in press)
Attitude towards Foreign Product Purchase: Malaysian Consumers Perspective
by Khairul Anuar Mohammad Shah, Hazril Izwar Ibrahim, Nurliyana Maludin, Zurina Ismail
Abstract: This study examines the Malaysian consumers attitudes towards foreign purchase products. Specifically, this study investigates the consumers attitude whether they have the feeling of boycott, animosity, ethnocentrism, patriotism and worldmindedness towards foreign made products. It also has examined how these constructs can affect the foreign product judgment and their willingness to purchase such products. This study surveyed on 512 consumers from Penang, Kuala Lumpur, Melaka and Terengganu (East Cost). Methodology and practical implications were discussed at the end of this study. The findings show that consumer patriotism and consumer worldmindedness mediates the relationship between product judgment and purchase willingness of foreign made products. The results also indicated that consumers with the attitude of animosity and ethnocentrism was negatively judge foreign made products and consumer worldmindedness was positively judge of foreign made goods and products. Surprisingly, only consumer worldmindedness was positively related to purchase willingness of foreign made goods. In conclusion, this model of study s was performed well by testing the goodness of fit analysis. Discussion of findings and direction of future research are highlighted.
Keywords: boycott; animosity; ethnocentrism; purchase willingness; product judgment.
Online Financial Reporting Disclosure in Islamic Banking: Evidence from Bahrain
by Adel Sarea, Azam Khalid, Amanuddin Bin Shamsuddin, Iqbal Hawaldar, Zakir Hossen
Abstract: This study aims to investigate the level of disclosure of Islamic banking in Bahrain by the web-based disclosure. The web-based disclosure method was implemented to determine the quantity of the level of web-based disclosure of Islamic banks in Bahrain by using index consists of 90 items. The findings of the descriptive analysis indicated that the overall level of web-based disclosure was 73.3 %. The regression results showed a positive relationship between the independent variables (firm size, age, and profitability) and the level of web-based disclosure. The results of this paper help the Islamic banking in Bahrain to increase the level of web-based disclosure to reach full Online Financial Reporting Disclosure (OFRD) to satisfy the stakeholders. The outcomes of this study will be useful elsewhere.
Keywords: Online Financial Reporting Disclosure (OFRD); Islamic banking; Bahrain.
Assessment of Reputational Risk Impact on Commercial Banks Financial Performance
by Viktorija Skvarciany, Daiva Jurevi?ien?, Ksenija Kravec
Abstract: The current study aims to determine criteria linked to a banks reputation and evaluate the effect of reputation on the commercial banks performance. In order to estimate the impact of reputation on a commercial banks performance, the expert evaluation method was chosen. The research was conducted in two steps: first, the unstructured (informal) interview was applied to extract the factors; second, the multicriteria decision methods such as SAW, COPRAS and geometric mean were employed for evaluating the determined factors. The research results showed that the weakest position of the commercial bank in terms of reputational risk implied the performance efficiency decrease. The conducted research contribute to the scientific literature by providing a methodology for assessing the impact of reputational risk on commercial banks performance. However, the proposed methodology could be applied to those banks that do not provide services for individual customers but work with business clients only.
Keywords: Reputation; reputational risk; multicriteria decision-making methods (MCDM); SAW; COPRAS; geometric mean; banking.
Investigating the Impact of Trade Shocks on Productions in Iranian Manufacturing Industries
by Parham Parsva
Abstract: In this study, using the panel vector autoregression model, the impact of trade shocks on production in Iranian manufacturing industries is investigated. For this aim, the time series data of the period from 1995 to 2017 as well as the impulse response and variance decomposition functions are used. The results of the model's estimation show that Iran's industrial development is heavily influenced by the import of capital and intermediate goods. Also, the results of this study indicate that various industries are affected differently by trade shocks, as some industries receiving a downward effect and some industries receiving an upward effect from these shocks.
Keywords: Manufacturing Industries; Trade Shocks; Impulse Response Functions and Analysis of Variance Decomposition.
ALTERNATIVE CAPITAL REQUIREMENT FOR INSURERS: POSSIBILITIES AND ISSUES
by ILZE ZARI?A, IRINA VORONOVA, GAIDA PETTERE
Abstract: Solvency II framework regulates how much capital the insurance companies of the European Union must hold. Although the framework lasts four years, there is still place for improvements considering experience. The goals of the research are to propose an alternative capital model methodology using copulas for reserve risk and to show the case study of potential capital shift impact. To conduct the research, the authors have used the extensive literature review, analytical methods and modelling. Research scope is non-life insurance companies under the Solvency II framework with a focus on reserve risk. The research will help avoid that alternative models are only a modern risk management tool and add risk management reality. Higher capital surplus can be achieved if a copula approach is used for risk aggregation in the Baltic non-life market. The Baltic market does not use alternative capital requirement and internal models. Using an alternative model is the right insurers approach in modern risk management.
Keywords: Solvency II; Value-at-Risk; risk management; insurance; internal model; reserve risk; best estimate; copula; solvency capital requirement; alternative capital requirement; t copula; normal copula.
Philips versus Matsushita: A Critical Review and Comparison
by Victor Chang, Yian Chen
Abstract: This paper examines the rise of two global companies Philips and Matsushita. The aim is to identify factors that contributed to the companies becoming the most successful in the industry. Furthermore, it evaluates and analyses the strategic choices the companies have made from the start of the establishments until the beginning of the new millennia. This paper aims to analyze how these strategies helped Matsushita overtake Philips as number one in the consumer electronics industry. However, the evolved organizational structure also creates disadvantages for the company to speed up growth. Finally, in the last part of this report, recommendations are made for Matsushita about appropriate strategies that can be adopted in the new millennium.
Keywords: Philips and Matsushita comparison; centralization and decentralization in management.
Emergence of Behavioural Finance: A Study on Behavioural Biases during Investment Decision-making
by Dhruv Sharma, Vandna Mishra, J.P. Pathak
Abstract: In 1950s & 1960s standard finance evolved & thereafter got wide acceptance among the academia However, standard finance paradigm faced difficulties and was questioned, when cracks began to appear due to the growing market inefficiencies and the fact that humans are not always rational Thus, the inherent flaws in traditional finance led to the emergence of behavioural finance, a new science which is a harmonious blend of research principles derived from subjects like finance, cognitive psychology, and behavioural economics It propounds psychological based theories to illustrate stock market anomalies, its core focus is to study the erroneous or less than perfect human behavior that influences individual investment decision and its subsequent effect on the market This paper aims to critically analyse the traditional financial theories, how behavioral finance supplemented these theories by introducing behavioural aspects and also uncovers the psychological impact of individuals on their decision making behaviour.
Keywords: behavioural; psychology; finance; anomalies; rational.
Non-Performing Assets: Drag for Stability of Indian Banking Sector
by Dolly Gaur, Dipti Ranjan Mohapatra, Pratap Ranjan Jena
Abstract: The positive and strong performance by banks is imperative for stable growth of Indian economy However, Non-Performing Assets (NPA) of banks are proving to be a substantial hurdle for India becoming a strong and stable economy Thus, the present work is an attempt to find and analyse the factors influencing NPA trends The proposed model for the mentioned subject matter comprises of a set of varied bank-specific, industry specific and macroeconomic variables The study includes some less used factors like, technical efficiency indicating bank performance, which has been measured using stochastic frontier model, and funding risk Considering the time frame of 14 years (2005-2018), 46 scheduled commercial banks in India have been studied For the purpose of analysis 2-step system generalised method of moments approach has been followed The findings indicate that NPA in India are time persistent and get discouraged by positive bank performance.
Keywords: Non-performing assets; India; Technical Efficiency; Dynamic panel; System generalized method of moments.
Trademark Cancellation and the Impact on Investment in terms of Commercial and Administrative Law: A Comparison of the UAE and Jordan
by Firas Massadeh, Moustafa Elmetwaly Kandeel, Ali Abdel Mahdi Massadeh
Abstract: This paper concerns the method of judicial review in the dismissal of a trademark, from a procedural judicial perspective. The research examines the impact procedural laws can have on substantive laws, in terms of the influence of commercial litigation and civil procedures on one hand, and administrative law procedures on the other, regarding the potential outcomes for dismissing a trademark. In the UAEs unified legal system, the civil/commercial courts review decisions to register trademarks, while in Jordans dual legal system it is the administrative courts, which do so. This paper investigates if this difference plays any role in cancelling trademarks, and whether it has any subsequent impact on investment and commerce.
Keywords: Trademarks; Commercial Litigation; Administrative Judiciary; Absolute Grounds for Dismissal; UAE; Jordan.
ON THE RESILIENCE AND THE RISK SPILLOVERS IN INNOVATION CLUSTERS
by Laura Gudelyte
Abstract: In this paper we provide the determination of systemic risk in a networked structure that appears together with synergistic effect as a result of collaboration in innovation clusters. The interpretation of proposed conceptual model of evaluation of systemic risk can be at least twofold: core-periphery, business entities-R&D institutions, etc. The systemic risk is treated as a generalized risk impacting directly or non-directly the performance of an innovation cluster. The conceptual model of evaluation of systemic risk should be useful for understanding and further treatment of measuring risk in a case of innovation management. Also, the structure and further properties of systemic risk and contagion within innovation cluster are discussed in this paper.
Keywords: contagion; structure of innovation cluster; systemic risk; uncertainty.
A Fresh Look at Environment Friendly Customers' Profile: Evidence from India
by Ishani Patharia, Sanjay Rastogi, Ravinder Vinayek, Sheetal Malik
Abstract: Increasing environmental concern has led to global pressure on companies to produce environment friendly products. There is an analogous need to improve environment friendly purchase behaviour. This paper provides precise psycho-graphic profile of environment friendly customers of electronic products by performing logistic regression analysis. Data was collected from 589 Indian customers who had purchased electronic products during the six months prior to participating in the survey. The results reveal that people with high environmental concern, having good knowledge about environmental problems and their solutions through environment friendly buying behaviour will buy environment friendly electronic products if they have trust in product attributes and believe that their personal actions really contribute towards environmental sustainability. These findings provide very important clues to design pragmatic strategies to improve environment friendly purchase behaviour.
Keywords: Environment Friendly Customer Profile; Green Purchase Behaviour; Theory of Planned Behaviour; Perceived Consumer Effectiveness; Government Efforts; Logistic Regression Analysis.
Analysing the mediating effect of leader-member exchange on the relationship between servant leadership and organisational commitment
by Arun Aggarwal, Kamrunnisha Nobi, Dinesh Jaisinghani, Geeti Sharma
Abstract: The objective of the current research is to analyse the mediating role of leader-member exchange on the relationship between servant leadership and organizational commitment. In order to achieve this objective, the data was collected from 524 full time employees working in five companies of information technology sector operating in northern India. Results of the structural equation modelling analysis revealed that servant leadership has significant and positive impact on leader-member exchange. Further, servant leadership has positive impact on organizational commitment. Leader-member exchange has positive impact on employees commitment level except continuance commitment. Finally, results of the mediational analysis shows that servant leadership mediates the relationship between leader-member exchange and affective, continuance and normative commitment.
Keywords: Servant Leadership; Leader-Member Exchange; Affective Commitment; Continuance Commitment; Normative Commitment; Structural Equation Modeling.
ECONOMIC IMPACT OF CYCLING ACROSS VARIOUS NATIONS
by Alpana Agarwal, Virad Gupta
Abstract: The purpose of this paper was to find the impact of cycling in five nations, namely Canada, Europe, New Zealand, UK and USA. Bicycle tourism and trail tourism contribute significantly to local, state, national and international economies (Handy et al., 2014). Research papers for the mentioned five Nations were analysed about the volume of their economic impact, and which were most benefitted. Analysis is based on behaviours (satisfaction) of cyclists, development of local communities and small scale businesses, management and governance of cycling, tourism, environment, recreation, health benefits, tourists and commuters, which saved the state and national governments funds as well as increased fuel and moneysaving. Six broad factors, i.e., areas topography, its climate, the cycling infrastructure, presence of accessible bicycle resources, business support and community support were analysed to examine their effect on cycling. Characteristics of the Indian market were also examined, based on which a few suggestions are given.
Keywords: economic impact of cycling; tourism; cycle trails; economic development; health impact; topography; infrastructure; Indian cycling market.
EFFECTS OF ECONOMIC CONDITIONS ON BUSINESS GROWTH: AN ANALYTICAL STUDY
by Harshita Bhargave, Ashish Srivastava
Abstract: Economic conditions provide important insights to organizations so that business firms adjust their views to attain growth. Hence, authors tried to investigate the effects of economic conditions on business growth where 200 sample sizes are taken for the structured survey. Six progressive modern cities of India have opted for the survey. To obtain the authentic data; Interview and Questionnaire survey techniques have been performed. Finally, it is found that higher interest rates lead to failure in achieving business goals. Overall, 64 % of the organizations validate the fact. SWOT analysis leads to an accurate evaluation of business performance. It is interesting to notice that only 8 % of the business concerns are disagreeing with the fact. Subsequently, it is suggested that it is better for an organization to be well equipped with strategic tools and competencies in order to beat the economic challenges.
Keywords: Economic conditions; Business growth; Gross domestic product; GDP; SWOT analysis; Economic challenges.
Internationalisation of Indian SMEs: Problems and Prospects
by Nidhi Arora, Parneet Kaur
Abstract: The purpose of this research is to find out the factors that initiate and hinder the process of internationalisation of Small & Medium enterprises with reference to state of Punjab in India. The factors which initiate internationalisation of Punjab SMEs were divided into internal and external factors. The data was collected through questionnaire from 100 SME exporters from Punjab. The firms were selected from the top five industries which contributed maximum to the exports. With the help factor analysis and multiple regression technique, the findings indicate that the factors initiating internationalisation are international direction, resource capability, managerial competencies, technology updation, competitive industry, international networks and government support whereas, the barriers faced were operational and governmental problems. The results of the study provide us with various factors which should be kept in mind while entering into foreign markets and will help the policy makers to make strategies regarding internationalisation of SMEs.
Keywords: Internationalisation; SMEs; Exporters; Barriers; Driving Forces.
Exploring trust and responsiveness as antecedents for intention to use FinTech services
by Shubhangi Singh, Marshal M. Sahni, R.A.J. KUMAR KOVID
Abstract: FinTech is an emerging paradigm in financial services industry which is becoming the additional source of revenue generation not only for banking companies but also for telecommunication and retail companies It is a form of service delivery enabled by innovative technologies Despite the numerous benefits of FinTech, its acceptance with users is not as per the industry expectations This can be attributed to various factors such as lack of trust or responsiveness in available FinTech services The objective of our research is to explore the antecedents of intention to use namely, perceived usefulness, perceived ease of use, perceived trust and responsiveness These factors were empirically assessed by survey of 439 FinTech users Exploratory factor analysis was done to extract relevant factors Structural equation modelling was done to examine model fit and hypotheses testing The analysis shows that usefulness and ease of use have direct effect on intention to use. Trust and responsiveness have an indirect effect on intention to use and is mediated by usefulness and ease of use.
Keywords: FinTech; TAM; intention to use; trust; responsiveness.
Risk Management Considerations for Artificial Intelligence Business Applications
by Gerg? Barta, Gergely Görcsi
Abstract: The number of projects and the amount of investment into artificial intelligence (AI) based business process automation is increasing that is also due to research advancements in corresponding fields. To utilise its true power, business organisations shall identify and treat risks arising from AI, that must be reduced to an acceptable level to maintain fraud-free business operation in alignment with external legislative requirements. If risks are not assessed, then AI might cause greater headache resulting in expensive implementation without business benefit. The objective of the paper is to analyse the nature of risk elements that AI can bring to the life of corporations and the countermeasures that shall be implemented by analysing general IT risk assessment processes and the stages of intelligent system development. The article also examines frameworks for AI risk management approaching risks associated with intelligent decision making by providing guidelines of required business processes to be implemented.
Keywords: Artificial Intelligence; Machine Learning; IT risk assessment; Risk Management Framework.
Investigating the determinants of financial leverage: The case of China's real estate sector
by Mohamad Kaakeh, Korhan Gokmenoglu
Abstract: This study empirically investigates the determinants of capital leverage in the case of Chinese real estate sector. Annual panel data of 130 companies is used to cover the period 2007-2017. Profitability is treated as a latent variable to avoid any specification error. Structural equation modelling confirmed that both size and financial cost had a significant positive relationship with the level of leverage while liquidity, tangibility, and non-debt tax shields had a negative relationship with the level of debt. Our findings provide supportive evidence for different corporate finance theories for China?s real estate firms. Despite the substantial difference in institutional structure between China and Western countries, findings show that firm-specific factors are partially similar between both. The Chinese government should reduce the financial constraints applied to corporations to borrow external debt or issue new stocks for them to achieve the optimal balance between debt and equity.
Keywords: Structural equation modelling; capital structure; leverage; real estate sector.
The impact of financial inclusion on banks performance: the case of Jordan
by Amer Qasim, Abdul Razzak Al-Chahadah, Ghaleb A. El Refae
Abstract: This study aims to examine the impact of financial inclusion on the financial performance of Jordanian banks listed in the Amman Stock Exchange. The study empirically tested the impact of five main indicators of financial inclusion on bank performance. Using a simple regression analysis, findings of the study showed statistically significant impact of two indicators of financial inclusion (i.e. financial access and enterprise financing) and bank financial performance (i.e. bank profitability) of Jordanian banks. The study recommends Jordanian financial institutions to move toward increasing innovative access to financial services as well as enhancing IT infrastructure and the development of financial services to raise the level of digital banking services which is currently considered relatively low when compared to other middle-income countries.
Keywords: financial inclusion; banks performance; emerging economies.
Are chaebol firms ethical?
by Soonwook Hong
Abstract: The present study investigates the ethics of chaebol firms. The ethics include both external ethics and internal ethics. The ethics of chaebol firms is tested using CSR, which represents corporate external ethics, and earnings management, which represents corporate internal ethics. The empirical result shows that chaebol firms conduct less accrual earnings management, while conducting more real earnings management. Chaebol firms are found to be active in CSR activities. In addition, those chaebol firms that diligently conduct CSR activities are shown to conduct less accrual and real earnings management. Although chaebol firms are unethical internally, active CSR activities are judged to reduce the internal unethicality of chaebol firms. The present study is meaningful in that it analyzes the ethics of chaebol firms, which occupy a considerable proportion in South Korean economy, from various angles.
Keywords: Chaebol; business ethics; corporate social responsibility (CSR); accrual earnings management; real earnings management.
Consequences of Event-Sponsor Fit in Sport Sponsorship: Evidence from the Indian Premier League
by Giridhar B. Kamath, Simon George, Shirshendu Ganguli
Abstract: This study investigates the sponsorship effectiveness in the context of the Indian Premier League (IPL). Using the theory of planned behavior, a conceptual model was developed with the event-sponsor fit as the independent variable and brand equity and purchase intention of the event sponsor as the dependent variables. Data was collected from 303 IPL fans using a questionnaire survey using a standard questionnaire Structural equation modeling was used. The results showed that event-sponsor fit influences the attitude towards the sponsor and sponsorship as a whole. The attitudinal constructs influenced the brand equity and purchase intention of the sponsor brand. This is the first study that empirically tests the relationship between event-sponsor fit, attitudinal constructs, brand equity and purchase intention in the context of IPL. The findings of this study can help the brand marketers to strategically look for sponsorship programs.
Keywords: Event-Sponsor Fit; Attitude towards sponsor; Attitude towards sponsorship; Sponsor brand equity; Brand purchase intention; Indian Premier League.
An Exploratory Study Identifying Motives and Barriers to Ethical Consumption for Young Indian Consumers
by Swetarupa Chatterjee, Naman Sreen, Pradip Sadarangani
Abstract: In recent times, there has been a huge uproar in the media about ethical consumerism. Ethical products can help corporations to build positive brand image and improve bottom line and can help consumers feel proud by contributing to the well-being of people, planet and animals. The purpose of this study is to check the drivers and the barriers of ethical consumption. The study incorporates focus group discussions for learning about the factors propelling the growth of the consumption of ethical products, as well as those that are hindering the growth. We identified personal values, habit, social guilt, separate categorization of ethical products in retail stores, need for a certification, source credibility and government policies as the motivators of ethical consumption. We identified dearth of knowledge, willful ignorance, high price, and green scepticism (or cynicism), tragedy of commons, quality of the product and the product category as barriers to ethical consumption.
Keywords: Ethical Consumption; Barriers; Motives; Focus Group Discussion; Millennial.
Foreign Direct Investment and corruption paradigm impacts: a panel data study
by H.M. Sohail
Abstract: Foreign direct investment (FDI) is the overriding key in the advance and growth of any economy. In this paper, using unbalanced panel data and OLS regression, we first probe the effect of corruption on FDI in the host less corrupt country (LCC) and the host more corrupt country (MCC). Secondly, we investigate the impact of corruption difference (between home and host countries) on FDI in both categories (LCC, MCC). We test the model of big sample of countries that diverge in their level of corruption. To confirm the validity of this study, a multiplicity model of specifications and estimation strategies is investigated to endow with robustness. However, the consequence of corruption difference found negative and consider it as grabbing hand in full sample and in MCC. This study reveals that the overall effect of corruption is positive and found it as helping hand.
Keywords: Corruption; FDI; Panel data; Cross border activities.
English Language Proficiency and Immigrant Families Annual Earnings and Medical Care Spending in the USA
by Ibrahim Niankara
Abstract: This paper investigates the role of English language proficiency (ELP) as a measure of cultural integration on the economic integration, measured by annual earnings, and health care market integration, measured by annual medical care spending of U.S. immigrant families between 2015 and 2017. Bayesian Markov Chain Monte Carlo (MCMC) estimation of a mixed bivariate ordered probit (MBOP) specification of annual earnings and medical care spending is conducted using a nationally representative pooled cross-sectional sample of immigrant families data from the U.S. National Health Interview Surveys (NHIS). The results reveal that annually, limited ELP has an increasingly negative impact on US immigrant families propensity to earn income (-$44.83, -$50.66, and -$56.97), while simultaneously positively impacting at a decreasing rate their propensity to spend on medical care ($8.09, $6.09, and $4.32). Furthermore, we find a positive yet significant 7.2% correlation coefficient between annual earnings and medical care spending propensities.
Keywords: English proficiency; Earnings; Immigrants; MCMC; Medical Care Spending.
The effect of control-ownership rights and business groups on cash holdings
by Silvia Flores, Igor Sonza
Abstract: The purpose of this paper is to investigate the influence of voting and cash flow rights deviations and group affiliation on the cash holdings of Brazilian companies. We employed a panel data analysis for 81 listed Brazilian firms during the period from 2010 to 2017, with Dynamic GMM-Sys. The results report that the greater the deviations between voting and cash flow rights, the higher is the cash holdings, probably related to future projects that provide private benefits. Controllers will have incentives to dispose of company resources (cash) for their interests, to the detriment of minority shareholders. The group affiliation is not a determinant of cash holdings in Brazil. The research brings new perspectives of complex organisational structures, such as companies with deviations of rights.
Keywords: Cash holdings; voting rights; cash flow rights; deviations; business groups; Brazil.
Examining the causes of entrepreneurial intentions and their moderating effects
by Tin Horvatinovi?, Mladen Turuk, eljko Sudari?
Abstract: Entrepreneurship plays an important role in the development of an economic system on the national and regional level. Given these findings, it is not startling that several different strands of research have been and are still being conducted on the topic of what determines individuals to create and start their business ventures. In this article we used the theory of planned behaviour as our theoretical foundation. Along with the conventional elements of the theory, individuals attitudes, subjective norms and perceived behavioural control, we tested additional moderating effects. The results show that attitude towards entrepreneurship and perceived behavioural control have a positive impact on entrepreneurial intentions, while the opposite is true for subjective norms. In addition, gender has a significant moderating effect only for subjective norms. Finally, subjective norms were found to moderate both the relation of attitude towards entrepreneurship and perceived behavioural control on entrepreneurial intentions.
Keywords: entrepreneurial intentions; entrepreneurial education; theory of planned behaviour.
Nexus between Assets Structure and Profitability of Croatian Banking System
by Iris Lon?ar, Tonci Svilokos
Abstract: Considering that the largest share of national money assets is concentrated in banks, it is expected that, through profitable business, they dont meet only the interests of their shareholders and management, but also have positive effects on the whole economy. Therefore, the question of the profitability of banks business becomes a key issue. The aim of this paper is to analyse the influence of the structure and dynamic of total assets on financial performances on the example of the Republic of Croatia. In order to achieve the main purpose, the cross-section and fixed-effects panel models will be estimated. They will include standard profitability and various assets indices. The results of the analysis show that the level of total assets and specially level of fixed assets, as well as the share of the other deposits significantly influence on the level of profit after taxation, as well as on ROA and ROE.
Keywords: Croatian banking industry; structure of total assets; profitability; return on assets; return on equity; cross-section model; fixed-effects panel model.
Risk Assessment of Business Models driven by Industry 4.0
by Kristina Kovaite, Jelena Stankevi?ien?
Abstract: Industry 4.0 is changing business models and in so doing presents new risks that need to be addressed. Research by the authors of this paper developed a risk assessment matrix, Risk Assessment for Business Model Digitization (RADi) which consists of technical, competences, employee and customer consent, data security, and financial risk. The expert evaluation uses the FARE method as a multi-criteria decision support approach. The results determine which parts of a business model driven by the Industry 4.0 are those to be most affected by different risks. The results of this study indicate the greatest impact is on customer channels, key resources, revenue stream, and customer segments, whilst key partners are the least impacted. Our research demonstrates that the RADi model can be used by firms to identify and plan for critical risks as well as to implement the digitization of business models. Policymakers will also find the RADi approach useful to anticipate risks and prioritize public support and regional development.
Keywords: Industry 4.0; digitalisation; risk assessment; business model; multi-criteria methods; FARE method.
The influence of environmental, social, governance factors and firm performance on the sustainability reporting of Malaysian companies.
by Ruhaini Muda, Nor Faezah Abdullah Sani, Ramesh Nair, Roshayani Arshad
Abstract: Sustainability reporting is essential to demonstrate commitment, transparency and a competitive advantage. It is crucial to understand how companies can benefit by incorporating sustainability reporting to disclose the sustainability activities of their business. This study utilises the data set of 47 companies that were listed on the FTSE4G Bursa Malaysia from 2014 to 2017. The findings indicate that there is no significant relationship between environmental, social and governance (ESG) factors and firm value (i.e. Tobin's Q) as well as firm profitability (ROA) of companies that continuously issued sustainability reports. However, the result reveals that there is a significant and positive relationship between ESG factors and firm value for companies that continuously listed on the FTSE4G Bursa Malaysia. This implies that the companies have gained good reputation and a competitive advantage, regardless of whether they issued sustainability reports annually.
Keywords: Environmental; Social; Governance (ESG); sustainability reporting; firm performance; FTSE4G Bursa Malaysia.
The impact of word of mouth on brand equity: A case study from the sportswear market in Vietnam
by Vinh Tran, Ba Thanh Truong, Hoang Ngan Nguyen, Thi Kim Phuong Tran
Abstract: The main purpose of this study is to explore the influence of word of mouth (WOM) on brand equity in the causal relationships between its dimensions: brand awareness, brand associations, perceived quality, and brand loyalty. Sample data was collected from 335 customers in the sportswear market of Vietnam. Empirical results revealed that the model was a suitable fit with the sample. Results from structural equation modeling (SEM) show that: (1) word of mouth has positive effects on brand awareness, brand association, perceived quality and brand loyalty; and (2) these dimensions of brand equity are interrelated. Some suggestions for future research are provided.
Keywords: word of mouth; brand equity; sportswear market; SEM.
Factors Determining Z-score and Corporate Failure in Malaysian Companies
by Md. Mahmudul Alam, Nurul Izzaty Hasanah Azhar, Norziana Lokman, Jamaliah Said
Abstract: Predicting the sustainability of a business is crucial to prevent financial losses among shareholders and investors. This study attempts to evaluate the Altman model for predicting corporate failure in distressed and non-distressed Malaysian companies based on the data of financially troubled companies which are classified as Practice Note 17 (PN17) and matching similar non-PN17 companies during the period 2013 to 2017. This study utilizes panel ordinal and panel random effects regressions. Findings show that the liquidity, profitability, leverage, solvency, and efficiency ratios are negatively significantly associated with corporate failure and bankruptcy. The leverage ratio is determined to be the strongest indicator of bankruptcy, followed by profitability, liquidity, solvency, and efficiency ratios. The findings will help companies management bodies implement suitable strategies to prevent further financial leakage, thereby ensuring continuous and sustainable return on investment and profits for investors and shareholders.
Keywords: Corporate Failure; Financial Distress; PN17 companies; Ratio analysia; Z-Score.
Impact of E-Commerce on Indias Exports and Investment
by Ittika Takkar, Shalini Sharma
Abstract: E-Commerce has become an important mode of trade, both domestically and internationally. E-commerce provides a platform for exchange of goods and services and thus directly alters the cost of trade and profits of firms, while simultaneously, generates a demand for a different set of skilled managers and creates opportunities for increasing investment and thereby affects the volume of domestic and international trade and in-turn affects the overall level of output and employment in an economy. There are empirical evidences on how certain developed countries like United Kingdom, United States of America, earlier, and lately developing countries like China, have leveraged e-commerce to enhance international trade. This paper attempts to contribute to the literature by studying the impact of e-commerce on Indias international trade, especially exports, and investment which in-turn impact the level of output/GDP and employment in the country.
Keywords: E-Commerce; Internet; Trade; Exports; Investment; Growth; GDP; India.
The Effects of Foreign Direct Investment, External Debts and Trade Openness on Economic Growth: Evidences from Ottoman Empire 1881
by Abdul Rahim Ridzuan, Lotfi Demikha, Amir Shaharuddin
Abstract: This paper empirically examines the impact of foreign direct investment, external debts and trade openness on economic growth in Ottoman Empire. The existent literature lacks a comprehensive quantitative analysis of this pattern. The study is empirical and utilizes time series technique Autoregressive Distributed Lag Model (ARDL) on macroeconomic data for a period 1881-1914. The study reveals a significant positive effect of external debt, trade openness and government expenditure on economic growth. The obtained results also highlight the fact that foreign direct investment and inflation show a significant negative impact on economic growth. Our findings recommend focusing on adopting economic policies that promote generating funds using local sources instead of relying on external funders to boost economic development.
Keywords: ARDL; Economic growth; Ottoman Empire; FDI.
Identification of the Internal Reasons of Public Sector Banks Fraud in India by using Confirmatory Factor Analysis
by SOUVIK GHOSH, ANUPAM DE
Abstract: In last 3 decades Indian Public Sector Banks has witnessed exponential growth in fraud and fraudulent transactions which are classified into two categories viz internal and external The current study is to find out the internal reasons through Confirmatory Factor Analysis Initially, a good number of officers up to Deputy General Manager from various public sector banks were interviewed to identify 23 internal reasons of fraud Thereafter, based on the information collected through interviews a structured 5 scale questionnaire was prepared to collect responses from different public sector bank employees Applying Factor Analysis and based on certain criteria, 3 variables were excluded to get 20 variables which are grouped in 4 categories i e factors Thereafter validity of the constructs through model fit is checked using Confirmatory Factor Analysis Lastly, the most important variable in each factor was identified to focus on the impact areas to curb public sector bank fraud.
Keywords: Internal Reasons of Fraud; Public Sector Bank; Factor Analysis; Confirmatory Factor Analysis.
Scenario planning combined with probabilities as a risk management tool
by Helena Gaspars-Wieloch
Abstract: Scenario planning and probabilities are often very helpful in uncertain decision problems. In the paper, we examine the correctness of combining probabilities with scenario planning in risk management. We make a literature review and analyse diverse decision problems differing from each other with regard to their nature, the decision makers objectives and preferences. We explore competition, quality, innovation, resource allocation, inventory and banking issues. The illustrative examples concern both one criterion and multi-criteria decision problems. We get to the point that scenario planning is an unquestionable support for risk management. Nevertheless, the use of probabilities as an accompanying tool may be necessary and justified merely in some specific cases.
Keywords: scenario planning; probabilities; risk management and assessment; uncertainty; payoff matrix; decisions; banking; spare parts quantity problem; product quality; innovations.
METHODOLOGY OF CREATING SUCCESS CRITERIA WITHIN THE BUSINESS MODEL FOR ITS SUSTAINABILITY REASONS
by Helena Skadina, Rosita Zvirgzdina
Abstract: Complex business environment, growing intensity of competition and shortening of innovation cycles bring difficulties for management and decision making. If previously companies aimed to ensure the quality of their products, now the creation of value for customers and other stakeholders is becoming the most essential element for the future of a company. Sustainability in the sense of a sustainable business model represent the value creation in the stakeholders' perception. It means that each activity while modelling business should be checked for sustainability reasons by companys management. In this way it would be possible to improve controlling mechanisms within the company as well. The aim of this article is to offer a methodology contributing to creation of success criteria. As a result, there are methods presented which make the development of success criteria for Management possible and sustainability controlling for business activities related to time, costs, flexibility and quality.
Keywords: sustainability; business model; business model dimensions; success criteria; time; costs; value; flexibility indicators.
Brand Liking and Consumer Gratitude effects on Consumer-Brand Love Relationships and Repurchase Intention
by Prapatsorn Suetrong, Guilherme D. Pires
Abstract: This paper extends understanding of consumer-brand love relationships by examining the effects of brand likeability and consumer gratitude, as antecedents of brand love, on brand love creation and consumer repurchase intention. This is examined for service-products characterised relative to the dominance of their intangible elements, hence accounting for their search, experience and credence qualities. Using PLS-SEM and empirical data from an online survey, results indicate that brand likeability and consumer gratitude are directly related, and both constructs are positively associated with brand love for the three types of service-products, such that consumer gratitude is a significant mediator in the relationship between brand likeability and brand love. Examining brand likeability and gratitude effects on brand love narrows the knowledge gap in the brand love literature leading to important managerial implications, allowing for the development of effective brand strategies for strengthening consumer repurchase intention.
Keywords: consumer-brand love relationship; gratitude; likeability; repurchase intention; service-product category.