International Journal of Finance, Economics and Business
Not a member yet
87 research outputs found
Sort by
Investigating the Exchange Rate Regimes, Agricultural Output, and Economic Growth in Nigeria: A Transmission Approach
Full text linkPersistent calls for economic diversification in Nigeria underscore the need to reduce reliance on oil revenues and explore alternative sources of income. The agricultural sector emerges as a critical driver in this diversification strategy, offering opportunities for revenue generation, employment creation, and the development of value-added chains. However, Nigeria’s heavy dependence on imports renders the agricultural sector susceptible to exchange rate volatility. This study examines the impact of exchange rate regimes on agricultural output and economic growth in Nigeria through a transmission mechanism framework over the period 1970Q1 to 2023Q4. Utilizing secondary quarterly data obtained from the World Bank, this study investigates the direct and indirect effects of exchange rates on economic growth via agricultural output using Structural Vector Autoregression (SVAR), impulse response functions, and variance decomposition. Findings indicate that higher exchange rates negatively affect agricultural output. In low exchange rate regimes, increased agricultural output contributes modestly to economic growth due to limited domestic processing. Conversely, in high exchange rate regimes, agricultural output tends to reduce economic growth, primarily due to the export of unprocessed goods. The study recommends maintaining a stable and low exchange rate, investing in processing facilities, and strengthening institutional support to enhance the agricultural sector’s role in long-term economic growth
Factors of Local Community Participation in Tourism-Related Business in Kuala Terengganu, Malaysia
Full text linkTourism development has enabled the involvement of local communities, particularly in tourism-related business. Community involvement can improve the socio-economic status of the locals, especially in removing them from the clutches of poverty. Recognizing the importance of community involvement, this study attempts to measure the level of local participation in tourism-related business and identify the factors that stimulate community involvement in tourism-related business. A quantitative method of survey questionnaire was employed for data collection on the tourism-related micro and small enterprises in Kuala Terengganu. The study employed a purposive sampling method, obtaining responses from 113 tourism-related businesses across various categories, including accommodation, amenities, attractions, accessibility, and activities. The study used descriptive analysis, multiple regression and mean analysis. The result of the study reveals a high level of local community participation in tourism-related business in Kuala Terengganu, and encouragement from family was found as the most significant factor for participation. This study contributes to the body of knowledge on tourism-related business in suburban areas. The findings of the study will be useful for the tourism and authority stakeholders in the planning to promote participation of the local community in the tourism industry through involvement in business
Public Spending and Sustainable Human Development in Cameroon: Does corruption matter?
Full text linkThis study analyzes the effect of public spending on Human capital on human development in Cameroon by controlling the impact of corruption. After using quantitative methods, the ARDL model was applied with the bounds testing approach with time series data from 2000 to 2021. The results indicated that public spending on education and health positively impacts the change in the human development index. Similarly, economic growth (GDP) positively affects the variation of the human development index. Meanwhile, corruption and foreign direct investment (FDI) negatively correlate with the human development index. However, these results are only valid in the short term. In the long term, there is no relationship between the variables. The government should increase the expenditure budget and expand the target sector to reach the industry needed for human development. An improvement could follow this implementation in transparency in fiscal policy management, which can help reduce the corruption perception index. One of the limitations of this research is the use of a short observation period due to data availability. Therefore, the relationship between public expenditure, corruption, and human development in the CEMAC zone is another critical issue that could be investigated
Does Bank Credit Fluctuation Affect Inflation? Evidence from Indonesia
Full text linkBoth developed and developing nations frequently encounter the economic challenges of inflation. Middle- and low-income developing countries generally experience higher inflation rates than their high-income developed counterparts. Interest rates influence the relationship between credit distribution and inflation. This study examines how fluctuations in bank lending affect inflation in Indonesia. Monthly data from 2016 to 2023 were analyzed using the Autoregressive Distributed Lag (ARDL) approach. The findings reveal that working capital loans significantly positively affect Indonesian inflation in both the short and long term. While investment credit shows no short-term impact on inflation, it significantly positively influences the long run. Consumptive credit exhibits a significant positive effect on inflation in the short term but a significant negative effect in the long term. The BI rate shows no short-term influence on inflation. However, it has a significantly negative impact in the long term. Based on these results, it is recommended that Bank Indonesia enhance its coordination of monetary stability, inflation control, and financial system improvements, particularly regarding interest rates. Additionally, banks acting as intermediaries should monitor the utilization of working capital, investments, and consumptive credit to help manage inflation in Indonesia
The Effect of Organizational Readiness and Top Management Support on Supply Chain Management Performance: The Mediating Role of Accounting Information Systems
Full text linkMicro, small, and medium enterprises (MSMEs) are crucial to the economies of developing countries like Indonesia, demonstrating resilience during economic challenges such as the 1998 financial crisis. This study investigates how organizational readiness and top management support affect supply chain management performance in MSMEs, with the success of accounting information systems as a mediating factor. Using purposive sampling and G*Power software, 178 MSMEs from diverse sectors were analyzed via Partial Least Squares (PLS). Results show that organizational readiness and top management support significantly impact supply chain management performance and the success of accounting information systems in Pekanbaru, Indonesia. However, accounting information system success does not mediate the relationship between organizational readiness, top management support, and supply chain management performance. This indicates that other factors might serve as critical mediators. To improve supply chain management performance, MSMEs should enhance organizational readiness and secure top management support. Future research should investigate alternative mediators, such as technology or innovation, and include studies across various sectors for broader insights
Modelling the Stock Market Volatility of Dar es Salaam Stock Exchange (DSE) using Generalized Autoregressive Conditional Heteroscedasticity
Full text linkThe existing empirical literature has extensively explored stock market return volatility in various emerging and developing markets; however, limited attention has been given to the Dar es Salaam Stock Exchange (DSE). This study seeks to address this gap by analyzing the volatility dynamics of stock returns in the DSE. The analysis is based on a dataset comprising 1,846 daily observations spanning the period from June 2014 to November 2021. Consistent with prior studies, the findings reveal a significant negative relationship between returns and risk, as modeled using the AR(1)-GARCH(1,1)-M framework. The application of the GARCH(1,1) model effectively captures volatility clustering, following the confirmation of heteroscedasticity in the return series. However, due to the GARCH model’s limitations in capturing asymmetries in volatility (i.e., the leverage effect), the analysis was extended using the AR(1)-EGARCH model. The results support the presence of a leverage effect in the DSE, indicated by a negative and statistically significant leverage coefficient. This suggests that negative shocks have a greater impact on volatility than positive shocks of the same magnitude. Moreover, the study confirms a negative correlation between stock returns and volatility. These findings imply that higher levels of risk may lead to disproportionately larger losses for investors in the DSE. Therefore, market participants, policymakers, and portfolio managers must exercise caution and implement robust risk management strategies to safeguard investments against unexpected market fluctuations. The results also offer valuable insights for investors, scholars, and researchers interested in understanding the behavior of stock return volatility in frontier markets such as Tanzania
The Effect of Domestic Investment, Foreign Investment, Labor, Unemployment, Human Development Index, and Inflation on Poverty in Indonesia
Full text linkIndonesia continues to contend with elevated levels of poverty, reflecting the diminished well-being experienced by a segment of its population. Various socio-economic factors influence the poverty rate. It is hypothesized that domestic and foreign investments, workforce participation, and the Human Development Index (HDI) could reduce poverty, while unemployment and inflation might exacerbate it. However, previous research has not reached a consensus on these relationships. This study examines the impact of domestic and foreign investments, labor force, unemployment, HDI, and inflation on poverty levels in Indonesia. The research employs panel data regression analysis, utilizing data from 34 Indonesian provinces spanning 2006 to 2022. The findings indicate that the fixed effect model is the most appropriate for this analysis. The study concludes that domestic investment, foreign investment, and labor force have a significant negative correlation with poverty. Conversely, unemployment demonstrates a significant positive relationship with poverty rates. Notably, the HDI and inflation do not significantly affect poverty in Indonesia. To address these issues, the Indonesian government should focus on enhancing domestic and foreign investor confidence by improving legal certainty and offering various incentives to stimulate investment. Furthermore, the government must prioritize improving education and healthcare services to elevate HDI and alleviate poverty
Analysing the Effect of Climate Change and Green Stocks on Economic Growth: Evidence from Indonesia and Malaysia
Full text linkContemporary economic growth shows a direct correlation between energy consumption and productivity. As economic development and technological advancements enhance living standards, the demand for natural resources and energy has concomitantly increased. This investigation examines the impact of climate change and green stocks on economic growth and the causal relationships among these variables in Indonesia and Malaysia over short- and long-term periods. Climate change has resulted in a downward trend in economic growth fluctuations, underscoring the necessity for green finance to mitigate the effects of climate change. The study employs the Autoregressive Distributed Lag (ARDL) model and Granger Causality test, analysing data on carbon emissions, green stocks, and gross domestic product from 2016-2022 (quarterly). The findings indicate that, in the short term, only green stocks positively influence economic growth in Indonesia and Malaysia. In the long run, climate change and green stocks positively affect economic growth in these countries. Economic growth demonstrates a unidirectional causal relationship with climate change, whereas climate change exhibits a unidirectional causal relationship with green stocks. This implies that green stock can mitigate climate change risks in Indonesia and Malaysia. It is recommended that the central bank consider implementing an environmentally sustainable financial system to promote economic growth
Unveiling the Impact of ESG Reporting on Stock Returns: Insights from India\u27s Top 500 Companies
Full text linkHigh-profile cases of corporate financial misconduct, such as those involving Satyam and Enron, have prompted regulatory authorities to introduce mandatory disclosure requirements regarding non-financial activities. These regulations aim to enhance transparency and enable stakeholders to better understand a firm’s environmental, social, and governance (ESG) practices. In 2015, the Securities and Exchange Board of India (SEBI) implemented a pivotal policy mandating the top 500 publicly listed companies, ranked by market capitalization, to publish annual Business Responsibility Reports (BRRs). This study investigates the impact of these disclosure requirements from the perspective of investors by examining and comparing the financial performance of the affected firms before and after the regulation\u27s implementation. The analysis reveals a notable trend: a greater proportion of firms experienced negative stock returns following compliance with the non-financial disclosure mandate, compared to those that recorded positive returns. To further explore this phenomenon, a focused analysis was conducted on a subset of 50 companies within the top 500, selected based on their ESG ratings as assessed by Standard & Poor’s. The results indicate a significant decline in financial returns among firms with strong ESG performance after 2015, suggesting a potential inverse relationship between ESG compliance and short-term financial outcomes during the post-regulation perio
The Moderating Role of Motivation in the Relationship Between Work Ability and Employee Performance: A Case Study of PT. Nongsa Jaya Buana, Batam, Indonesia
Full text linkThis study was conducted at PT. Nongsa Jaya Buana with the aim of analyzing the mediating role of motivation in the relationship between work ability and employee performance. The research involved the entire employee population of the company, comprising 71 individuals, all of whom were included as respondents. Data were analyzed using the Structural Equation Modeling (SEM) approach with the assistance of SmartPLS software. The findings indicate that work ability has a significant positive impact on employee performance, and motivation also significantly influences performance. Moreover, motivation was found to act as a mediating variable, strengthening the relationship between work ability and performance. These results suggest that improving both work ability and motivation can lead to better employee outcomes. From a policy perspective, these findings underscore the importance of developing integrated human resource strategies that not only enhance employee skills and competencies but also foster motivation through appropriate incentives, recognition, and a supportive work environment. Such efforts are essential for achieving sustainable improvements in organizational performance