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Impact of the rule of law, corruption and terrorism on tourism: Empirical evidence from Mediterranean countries
No full textResearch background: Tourism sector is considered as a driving force of economic development and understanding factors that deter the flow of tourists and hinder its development, which is essential for all actors involved in this industry.
Purpose of the article: The purpose of the article is to investigate the impact of rule of law, corruption, and terrorism on tourism in 14 coastal states of the Mediterranean Sea based on the United Nations classification.
Methods: The short and long-run relationships among the rule of law, corruption, terrorism and tourism are respectively analyzed through Dumitrescu and Hurlin causality test and LM bootstrap cointegration test taking notice of the presence of heterogeneity and cross-sectional dependence.
Findings & value added: The causality analysis reveals that control of corruption has a significant influence on tourism only in the short run. The cointegration analysis uncovers that terrorism negatively affects the tourism in Albania, Algeria, Egypt, and Tunisia, but improvements in corruption also positively affect the tourism in Albania, Algeria, Bosnia and Herzegovina, Greece and Italy. Last, the rule of law has a positive impact on tourism in Egypt, Greece, and Israel. In this context, the rule of law can also be a key factor for tourism development via combat with corruption and terrorism. Based on some unique characteristics, the Mediterranean region has consolidated its position as the world\u27s leading tourist destination, but to maintain this competitive position, it is crucial to recognize and adopt strategies that respond to all key challenges faced by this sector
Is earnings management impacted by audit fees and auditor tenure? An analysis of the Big Four audit firms in the US market
No full textResearch background: Audits are intended to ensure the reliability of financial statements, as this is fundamental for different stakeholders. However, both auditor tenure and audit fees could affect the earnings management of companies. In 2014, the European Union established a mandatory audit firm rotation policy. In the United States, although there is still no mandatory regulation in this regard, there has been a large public debate over the advisability of this policy. Another unresolved controversy is whether audit fees determine audit quality.
Purpose of the article: The aim of this research is to study the effect of auditor tenure and audit fees on earnings management, i.e., to determine whether a longer-term relationship between the auditor and the audited company, as well as higher audit fees, reduce the audited company\u27s earnings management, thereby making the financial statements more reliable for stakeholders and increasing the quality of the audit report. In addition, the Big Four auditing companies in the United States were analyzed in order to determine the influence of corporate culture.
Methods: A sample of companies listed in the S&P 500 stock market index was employed for the analysis, covering the years 2012 to 2021, resulting in a dataset comprising 3,010 observations. To examine the research hypotheses while mitigating the potential bias from omitted variables, a linear regression analysis was conducted using panel data with fixed effects regression. To enhance the robustness of the results, winsorized variables were also employed.
Findings & value added: Overall, the results confirm that the quality of financial statements improves as auditor tenure increases, and so implementing a mandatory auditor rotation may not be in a company’s best interests. The results also support the market segmentation theory, as higher audit fees are aligned with higher quality financial reporting. Furthermore, by analyzing the Big Four audit companies in the US, it is shown that the influence of audit fees and auditor tenure on earnings management also depends on the internal aspects of the particular audit firm, especially its ethical culture. In sum, US policymakers should neither set limits on audit fees nor enforce a mandatory audit firm rotation similar to that of the EU
The role of the Lendtech sector in the consumer credit market in the context of household financial exclusion
No full textResearch background: According to the World Bank (2020), about 60% of adults in developing countries do not use formal financial services. Furthermore, according to the Polish Association of Loan Institutions (2022), about 3 million Poles use loans, most of them obtained online. Among the reasons for more than a decade of growth of interest in the non-bank consumer lending market there are the development of modern technology applications in finance and the establishment of the Lendtech sector.
Purpose of the article: The main goal of the paper is to verify the role played by the Lendtech (LT) sector in the consumer credit market in the context of household financial exclusion. The following research questions were asked: Do credit-excluded households take advantage of LT services and, if so, to what extent? What are the behaviours and preferences of those who use consumer credit offered by LT? Do socio-demographic characteristics determine consumer use of loans offered by LT and, if so, what are they? Is the use of loans offered by LT due to credit exclusion or other factors? What action should be taken by participants in the digital consumer loan market interested in its inclusive direction?
Methods: The paper uses the following methods: critical analysis of the literature, Kruskal-Wallis test, Mann-Whitney test, and nonparametric regression algorithm: k-nearest neighbors, as well as inductive inference methods. The data used is primary in nature and comes from a nationwide survey, September 2022 (CAWI method) of 1,200 Poles, of whom 200 respondents are Lendtech customers. The quota selection applied made it possible to reflect characteristics corresponding to the population of customers of lending institutions registered in BIK databases.
Findings & value added: The article is a pioneering study based on an independent scientific survey, devoted to the Polish LT services market considered in terms of its relationship with one of the types of financial exclusion: credit exclusion. The most important conclusion is that people at risk of credit exclusion find a financing substitute in the LT sector, and thus it plays an important role in reducing financial exclusion, while maintaining the principle of creditworthiness verification
Sustainable growth rate, corporate value of US firms within capital and labor market distortions: The moderating effect of institutional quality
No full textResearch background: Understanding how distortions in capital and labor markets affect corporate value and sustainable growth is crucial in today\u27s economy. These distortions can disrupt resource allocation and economic sustainability. Additionally, the role of institutional quality in shaping these dynamics requires thorough exploration.
Purpose of the article: We quantify the effect of capital and labor market distortions on corporate value and sustainable growth rate (SGR) and how this association is moderated by institutional quality.
Methods: Stemming from the sample criteria, we calibrated a final sample of 1971 United States-listed manufacturing firms for 2012–2022. This research offers insights into market inefficiencies and institutional effects. Progressing towards objectives, we use advanced techniques like feasible generalized least squares and generalized methods of moments. These methods help us rigorously analyze complex relationships among study variables.
Findings & value added: Three key findings emerge: first, capital and labor market distortions have a negative and significant influence on corporate value and sustainable growth. Our primary finding implies that increasing distortions significantly reduce sustainable growth\u27s value and potential. Second, we find institutional quality has a positive significant effect on corporate value and sustainable growth. Third, institutional quality positively moderates the association between capital and labor market distortions, corporate value, and sustainable growth. Findings suggest that institutional quality, as a potential mechanism, improves the efficiency of resource allocation and optimizes the sustainable economic system to lessen the negative effect of factor market distortions on corporate value and SGR. Besides, we conduct robustness checks to validate our findings. Finally, we offer policymakers and stakeholders actionable insights
Possibilities of using cluster solutions in the policy of revitalisation of degraded municipal infrastructure in Ukraine
No full textThis paper discusses the issues concerning the policy of revitalisation as the basis for planning and carrying out the social and economic reconstruction of Ukraine. It is crucial to consider the scale of destruction and degradation of urban tissue, as well as the migration which occurred in the wake of the military operations. As a result, it is necessary to devise a specific programme of revitalisation which would use innovative organisational and guarantee instruments on a macro-, meso-, and microeconomic levels. The paper considers the factors which determine the aims of the municipal revitalisation policies, as well as their models, which include an analysis of degradation of urban areas as a step in the development of cities. The paper includes an examination of demographic factors, as well as those, which are associated with depopulation. In addition, the importance of urban infrastructure was highlighted in the process of revitalisation. Furthermore, the paper covers the analysis of literature regarding experiences in terms of using revitalisation clusters in degraded areas. The development of chosen clusters in cities in Western Europe was examined, having identified and evaluated basic conditioning factors of their use in revitalisation processes. Moreover, the importance of clusters was discussed, together with their possible use by establishing ‘Key National Cluster’ and, within its confines, ‘Regional Key Clusters’ in chosen oblasts in Ukraine according to their division into international areas of reconstruction. The scale of destruction and degradation of given areas of Ukraine was evaluated in terms of particular elements of revitalisation, together with the costs associated with reconstruction. This analysis covers the losses Ukraine experienced between July and December 2022
Differential geometry approach in optimization of the business production process
No full textIn this work we show a new approach to the optimization of the production process – from a differential geometry point of view. It is known ([2]) analytical conditions of profit maximization and minimization of the cost in an enterprise. In the first part of this work, we show such a classical approach. In the second part of the work, we use geometrical methods to obtain a new geometrical approach to the production process
The internationalisation of platform-based businesses – the case of GAFAM
No full textThe platform-based business model is indicated as the ‘winning’ one in the days of the digitisation of businesses. Such a platform constitutes a digital infrastructure bringing together various groups of users, whereas the platform owner provides facilities for establishing multi-sided relationships and interactions through the platform both within and between such groups. The platform generates the formation of a network of interactions between users and the operator of the business model seeks methods for and ways of monetising such interactions and data by organising the processing of data and the use of interactions. It has stimulated the spectacular development of the GAFAM corporations, the global IT giants and leaders. The paper aims to examine the process of the internationalisation of corporations relying on platformisation and to determine whether platformisation influence the internationalisation of economic activities. As demonstrated by the research carried out, despite their global operations, the digital corporations in question, GAFAM, have not internationalised as the process is traditionally understood; instead, they have been able to effectively operate on a global scale without expanding their foreign assets or foreign employment. It has created entirely new drivers towards decelerating globalisation as businesses relying on platforms and digitisation continue to grow
Development of intermodal transport by organizing group purchasing of transports
No full textThe purpose of the article is to recognize the contexts of intermodal transport development in Poland, with particular recognition of the factor of group purchases of this service. The aim of the research is to find out the opinions of the participants of the logistics-transportation processes on the opportunities and threats to the development of intermodal transport, and to seek opinions on the introduction of a new entity responsible for group purchasing to the market. The article is divided into four chapters. The first chapter discusses legal and financial factors supporting the development of intermodal transport in the European Union. Examples are given of countries that have made the most of this support and have good practices of their own for activating this multi-branch form of transportation. The second chapter, using secondary data, presents the dynamics of intermodal transport development in Poland. The third chapter presents the methodology of own research. Collecting and processing primary data, threats and opportunities for the development of the multi-branch form of transport in Poland were identified, and the results are presented in the four chapter. The results of own research clearly indicate the need to eliminate barriers to the development of multimodal transport in Poland (including by appointing bodies organizing transport purchases)
The impact of bequest taxation on savings and transfers
No full textResearch background: The paper investigates the impact of bequest taxation on saving and transfers when parents and children make decisions consistently. It complements the predictions of Gale and Perozek\u27s life-cycle modeling (2001) when decisions of parents and children are set independently and can be time-inconsistent.
Purpose of the article: The paper strives to answer the question of whether taxation of bequest harms savings and inter vivos transfers. The previous results indicated that this is possible for some bequest motives. Our results show that this is not likely for the most typical values of parameters.
Methods: The analysis involves economic modeling of four bequest motives: altruistic, paternalistic, accidental, and exchange. The method is based on the overlapping generation approach and life-cycle approach in the case of a paternalistic bequest. The results are supplemented with numerical simulations.
Findings & value added: For the altruistic motive, savings are smaller if interest rates are low relative to the tax rate and the utility of one\u27s consumption is more valuable than the utility of the next generations. For the accidental motive, savings decrease with small interest rates, high taxation and long-life expectancy. For the paternalistic motive, savings decrease when the interest rate and the value of future utility are low. For the exchange motive, savings are higher after a tax increase, but it depends on the value of attention and life expectancy. The general conclusion is that higher bequest taxation hamper saving behavior and may disturb the intergenerational exchange process. The bequest tax should, therefore, be set low, especially for aging populations, in order to induce higher savings and force the young to provide the elderly with higher attention