iRepository (Institute of Business Administration)
Not a member yet
6878 research outputs found
Sort by
Financial literacy and participation in financial markets: Evidence from Pakistan
No full textIntroduction
1.1 Brief Background of the study
Financial literacy is a prime determinant that goes a long way towards enabling people to make knowledgeable choices around savings, investments, and day-to-day financial control. In new economies such as that of Pakistan, lack of financial literacy severely restricts involvement in organized financial markets (World Bank, 2020). In spite of numerous financial services and products, numerous people in Pakistan continue to use informal modes of savings or investments in gold because of a lack of knowledge about organized financial systems (Khurshid & Abdullah, 2020). Such a lack of knowledge is especially worrisome in the face of increasing significance of financial inclusion in national economic development.
Pakistan has been reported to have lower financial literacy compared to the rest of the region, increasing barriers to gaining access to basic financial services and financial products (Lusardi & Mitchell, 2014). Income, education, and age determine a person’s financial education and, subsequently, market participation (Fatima & Ahmed, 2019). Financial illiteracy contributes to aggregate levels of investment and the avoidance of more economic participation. Closing the gap by providing education and awareness programs is paramount to promoting increased financial inclusion and enabling people to make informed financial choices (Atkinson & Messy, 2012).
1.2 Research Problem and Objectives
In Pakistan, financial literacy levels are low with only 26% of adult residents showing sufficient financial knowledge (SBP, 2023). Financial understanding restricts participation in organized financial markets, and many individuals, especially rural ones, use informal savings strategies (International Growth Centre, 2023). Financial inclusion has increased, but there are obstacles, specifically concerning financial education, gender gaps, and socio-economic factors like income and education levels (SBP, 2023).
This study aims to investigate the relationship between financial literacy and participation in financial markets in Pakistan. Specifically, the research objectives are: To evaluate the impact of financial literacy on participation in financial markets. To examine the role of socio-economic factors, such as income, education, and gender, in influencing financial literacy and market participation.
1.3 Significance of the study
The research is important because it targets the essential subject of financial literacy in Pakistan, a factor directly related to people’s involvement in the formal financial markets. It informs policy and financial education interventions by discussing the connection between market participation and financial literacy. The research can help improve financial inclusion by allowing people to make better-informed economic and financial decisions, and engender economic development by raising access to the financial system.
1.4 Contributions of the study
The paper contributes to an increasing body of literature addressing financial literacy by presenting empirical results from Pakistan, a nation with limited financial literacy and substantial market participation barriers. Both market participation and financial literacy are considered to provide insight into how socio-economic factors such as income levels, education, and gender influence financial behaviors. Policy and financial institutions can provide useful recommendations based thereon to design appropriate financial education programs that will promote financial inclusion and improved market participation by disadvantaged regions of Pakistan.
2 Theoretical Framework & Hypothesis
2.1 Key Theoretical Lens used in the study
The study adopts Ajzen (1991) Theory of Planned Behavior (TPB) as its underpinning theory. TPB theorizes that personal behavior is influenced by the three fundamental factors of attitudes to behavior, subjective norms and perceived behavior control. TPB, with respect to financial literacy, posits that a subject’s attitude to financial decision-making is influenced by their knowledge of finances, and this goes a step further to influence their financial market conduct. Furthermore, subjective norms or perceived pressures to participate in financial activities also greatly influence financial decisions. Perceived behavioral control is an individual’s belief that he or she can carry out financial decisions, and this can be determined by their financial literacy. TPB is a highly suitable theory when explaining the role financial literacy takes in financial market participation, and a valid framework to analyze the facilitators and constraints to financial participation in Pakistan.
2.2 Explanation of core concepts and relationships
The research focuses on two basic concepts: financial literacy and market participation. Financial literacy refers to an individual\u27s ability to understand and effectively use various financial abilities, such as managing budgets, saving, investing, and managing financial risks (Lusardi & Mitchell, 2014). It is essential to make appropriate decisions within the financial market, a situation this research addresses too. Financial market participation entails engaging in activities like investing in shares, mutual funds, and other organized financial assets. TPB asserts that financial literacy controls an individual\u27s attitude towards market participation, expectation of the benefit of taking part in financial markets, and the ability to navigate sophisticated financial commodities. Socioeconomic factors, such as earnings, education, and gender, also moderate between literacy and market participation. This research investigates relationships to identify barriers to market participation and measures to improve financial literacy.
3 Methodology
3.1 Research Design
The research is positivist in nature, measuring financial literacy and market participation objectively. This research is deductive with a beginning point of established theories (TPB) to test the hypotheses of financial literacy and socio-economic factors. The study is quantitative since numerical information is collected with reference to financial literacy, market participation, and socio-economic factors through a survey. This will provide the platform to test statistical procedures to assess inter-relation among the variables and make generalizable claims and draw conclusions that can be applied to shape policy and financial education within Pakistan.
3.2 Sample and Procedure
The population targeted comprises rural and urban Pakistani adults. A stratified random sampling technique is adopted to encompass different population groups by income level, education level, and gender. At least 500 respondents are chosen to ensure the data are reliable. The data were gathered online and face-to-face to make them accessible and inclusive.
3.3 Measures
Financial literacy is assessed by a standard measure that takes into account awareness of concepts such as saving, budgeting, investing, and managing financial risks (Lusardi & Mitchell, 2014). Financial market participation is assessed by the investments made by the respondents in stocks, mutual funds, or any formally organized savings and investment product. Controls related to socioeconomics are education, income, and gender. Attitudes and behaviors are assessed by a Likert scale.
3.4 Analytical Technique
The data are analyzed with Structural Equation Modeling (SEM) appropriate in terms of measuring complex relationships between latent and manifest variables (Hair et al., 2014). SEM allows testing of a number of interrelated dependencies concurrently and is appropriate to measure interrelatedness of financial literacy, socio-economic factors, and market involvement. SEM is particularly useful to quantify direct and indirect effects and to conduct a comprehensive evaluation of anticipated relationships in this research. SEM tests the theory with rigor and supports measurement and structural model analyses.
4 Key Findings
4.1 Summary of Final Results
The research demonstrated a considerable positive connection between financial literacy and market participation. Financial literacy levels were found to be linked to more participation in institutional forms of financial activities, like investment in equities and mutual funds. Socio-economic characteristics like income and education were found to moderate this connection, with the more educated and better-paid individuals showing more financial knowledge and market participation. Gender proved not to have a significant moderating influence, reflecting that financial literacy has the same effect on both sexes.
4.2 Insights drawn from data analysis
The evidence emphasizes the importance of financial literacy to enhance market participation in Pakistan. Financial literacy is essential to empower people to better understand the subtleties of formal financial systems. Socio-economic factors, namely income and education, reinforce the beneficial impacts of financial literacy, and this merits the provision of targeted financial education to disadvantaged population groups. The evidence also indicates that gender differences, if any, in this case do not have a considerable influence on financial decision-making. Policies targeted at financial literacy, therefore, are equally useful to all socio-economic classes.
5 Discussion & Contributions
5.1 Theoretical Implications
The research expands the Theory of Planned Behavior (TPB) by identifying the manner in which financial literacy impacts attitudes and perceived control over behaviors in market participation. This research extends the TPB by illustrating that socio-economic variables like income and education can both encourage and discourage financial behaviors that provide a more comprehensive insight into financial decision-making.
5.2 Practical Implications
The evidence indicates that boosting financial literacy, especially via targeted education programs to disadvantaged groups, can enhance participation in organized financial markets. Policymakers and financial institutions need to concentrate efforts towards providing accessible education to specific socio-economic classes to promote financial inclusion and enable people to make sound financial choices.
5.3 Limitations and future research Directions
The cross-sectional nature of this study constrains causation between financial literacy and market participation. It is possible that future studies use longitudinal studies to determine causal relationships. Further, investigation of the role of culture in financial behaviors of Pakistani citizens can offer more insight into financial inclusion barriers
Rethinking governance: The nexus between non-financial and financial performance for GCC countries
No full textPurpose
This study examines the direct effects of firms’ governance on financial, environmental and social performance and investigates how governance moderates the relationship between financial and non-financial performance.
Design/methodology/approach
We performed the panel data regressions using a sample of 207 listed firms from five GCC countries: Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates, over the period from 2015 to 2022.
Findings
Governance positively impacts financial, environmental, and social performance. Importantly, our results document a positive moderation effect of governance on the relationship between firm’s non-financial and financial performance, such that the firms’ environmental and social performance positively affect financial performance for firms with better governance.
Originality
This research is a first step in gauging the impacts of corporate governance for markets where business activities pose a significant amount of environmental risk in particular.
Practical implications
Strengthening corporate governance can provide direct financial benefits to firms while also improving the financial feasibility of their environmental and social initiatives. The findings of this research also hold value for policymakers and practitioners as it highlights the value of regulations and reforms in making business operations more sustainable.
Social implications
The findings of this research recommend enhancing governance in firms to improve the environmental and social initiatives that aspire to be in tune with the needs of the times
Impact of eco-design packaging on firms’ environmental performance and the moderating effect of green regulatory practices: A case study of Pakistan’s food and beverage industry
No full textSustainable packaging plays a critical role in mitigating the environmental impact of high carbon footprint food and beverage industry. This study focuses on eco-design aspect of packaging as well as its offline information sharing role on firm’s environmental performance. The study employs a quantitative research design, collecting data in a structured online survey from 100 senior and middle management professionals in the food and beverage industry in Pakistan. Using Partial Least Squares Structural Equation Modelling (PLS-SEM), the results of the study reveal a significant positive relationship between eco-design packaging and environmental performance, confirming that eco-design principles like recyclable material, minimalistic packaging design, reduced hazardous waste and substances, increase sustainability efforts and image. Moreover, the information sharing role of packaging like environmental labelling for transparent communication, also positively impacts firm’s environmental performance. However, there is dual moderating effect of green regulatory practices on the relationships. While the impact of eco-design is strengthened on environmental performance, it has a negative moderating effect on information sharing role, indicating inadequate support of regulatory frameworks for packaging as an information sharing tool. The study is unique with respect to the dynamic relationship between variables and results of this study make a valuable contribution as they clearly underscore the need for a comprehensive regulatory framework to be enforced for eco-friendly design, specially to encourage transparency in environmental communication. The study has significant social, managerial and academic implications respectively for environmental impact reduction, strategic decision making, regulatory compliance, enhancing sustainability efforts in emerging markets, and future studie
Risky Business or Digital Guru? How Pakistan’s Investors Navigate the Hype, Fear, and Promise of AI-Driven Trading
No full textPurpose: This research work is conducted to analyze the impact of AI Perception (AIP) on Risk Tolerance (RT) and Investor Behavior (IB) of individual investors in Pakistan and understandings of AI-driven investment tools in decision making within financial markets.
Methodology: We adapted a quantitative research design and collected data through survey responses from 216 individual investors. A structured questionnaire was used to measure the key constructs; all the measures were based on established scales. We examined AIP-RT-IB relationships using structural equation modeling (SEM).
Findings: The results from the analysis indicated that a positive perception of AI significantly enhances risk tolerance as well as enhance investor behavior towards investment. Besides, higher risk tolerance shows a positive effect on investor’s behavior, and the indirect effect of AI perception on investor behavior through RT has been proven partially. Finally, the research identified that higher level of risk tolerance weakens the positive impact of AI perception on investor’s behavior.
Implications: These results suggest that improving AI perception among investors is still significant to increase their risk tolerance and overall investment behavior. This AI-powered tool can be fully utilized to educate the investors and engage them for more insightful decision-making by financial institutions.
Novelty: This work contributes to the emergent literature on investor behavior with valuable insights into how AIP affects RT and IB. It consequently points out the importance of AI perception in shaping investment decisions within emerging markets, hence addressing an important lacuna in prior literature on AI technology issues from the point of view of behavioral finance
From Hashtags to Habits: The Role of Social Media in Shaping Sustainable Consumer Behavior
No full textPurpose:
To determine the part that social media plays in developing sustainable consumer behavior, this study looks at the function of the platforms, the effect of the influencers, the efficiency of the campaigns, demographic reactions and obstacles to the use of the sustainable practices.
Study Design/Methodology/Approach
To collect the data, a qualitative research method was used and in-depth interviews and focus groups were conducted among eco conscious consumers, influencers & marketing professionals. For the analysis of the influence of social media on sustainable consumer behavior, thematic analysis was employed in order to identify key themes and patterns.
Findings:
It was found that social media improves understanding and awareness on sustainability as well as spurs the development of a sense of community and offers practical resource that helps advancement towards sustainable practices. Consumer habits are shaped by influencers who are very credible, authentic, and their influence is very important. #ZeroWaste and #SustainableLiving campaigns have proven to be successful campaigns which have pushed unstoppable changes in consumer behaviors, which different demographics will react in different ways to sustainability messages.
Originality/Value:
It provides insights to the literature about the claims how social media affects consumer behavior, and then provides practical implications for a number of stakeholders.
Research Limitations/Implications:
The study may be limited in generalization due to the qualitative nature of the study. Further research should utilize quantitative methods to elicit the role played by new platforms and contexts of culture in adoption of sustainable practices.
Practical Implications:
It provides strategies for sustainable campaigns, authenticity for brands to avoid greenwashing, social platforms for policy makers to communicate for climate, education and NGOs to raise awareness for sustainability.
Social Implications:
With the roles identification of social media as a means to enhance sustainability, the stakeholders are able to formulate more relevant and potent approaches to facilitate a more conducive future for the sustainability.
The Influx of Green Innovation and Green Investment in South Asia: Sustenance Efforts Impacting Environmental Protection
No full textAs environmental challenges intensify, the South Asian region characterized by rapid industrialization, high population density, and fragile ecological systems faces a growing urgency to transition toward sustainable development pathways. This study investigates the role of green finance in mitigating environmental pollution while promoting sustainable growth in seven South Asian countries: Pakistan, India, Bangladesh, Bhutan, Maldives, Nepal, and Sri Lanka. Covering the period from 2000 to 2022, the analysis centers on evaluating both the short-run and long-run dynamics between carbon dioxide (CO₂) emissions and several key economic and environmental indicators.
Environmental pollution is proxied by CO₂ emissions (in kilotons), while natural resource depletion (NR), expressed as a percentage of Gross National Income (GNI), serves as an indicator of ecological stress. Green finance (GIFN) is operationalized as expenditure in US dollars toward environmental sustainability, environmental-friendly investments (EFI) are measured through investments in renewable energy, and green technology innovation (GTI) is captured via the number of environment-related patents filed. Additionally, GDP per capita, the Human Development Index (HDI), and population growth are incorporated as control variables. All data are sourced from the World Development Indicators (WDI) and the OECD.
The empirical methodology applies the Panel Auto Regressive Distributed Lag (ARDL) model, which allows for the distinction between short-run fluctuations and long-run equilibrium relationships across the selected countries. Three estimators are utilized: Pooled Mean Group (PMG), Mean Group (MG), and Dynamic Fixed Effects (DFE). These estimators facilitate cross-country comparisons while accounting for potential heterogeneity in economic structures and environmental responses. Stationarity of the panel data series is tested using both first-generation (Levin, Lin & Chu [LLC]; Im, Pesaran & Shin [IPS]) and second-generation unit root tests (ADF-Fisher and PP-Fisher).
The results of the unit root tests reveal a mix of I (0) and I (1) series, validating the appropriateness of the panel ARDL framework. The Hausman test is employed to determine the most efficient estimator, with results indicating that the PMG estimator is preferable due to its efficiency in long-run estimation under homogeneity constraints. The error correction term (ECT) in the PMG model is negative and statistically significant, confirming the existence of long-run cointegration among the variables.
Empirical findings reveal that green finance and green technology innovation have a significant negative effect on CO₂ emissions in the long run, indicating their critical role in reducing environmental pollution. Environmental-friendly investments also contribute positively to emission reductions, though with varying intensities across countries. GDP per capita exhibits a nonlinear relationship with CO₂ emissions, reflecting the Environmental Kuznets Curve (EKC) hypothesis in some countries. HDI is found to correlate negatively with emissions, suggesting that improvements in education, health, and standard of living may foster environmentally conscious behavior. Population growth, however, exerts upward pressure on emissions, underscoring demographic challenges to sustainability.
In the short run, results from the MG estimator reveal heterogeneous impacts across countries, influenced by varying policy implementations, institutional capacities, and stages of economic development. The findings underscore that while green finance mechanisms are effective, their outcomes are context-dependent and moderated by socio-economic factors.
This study contributes to the literature by integrating environmental, financial, and developmental perspectives using a comprehensive econometric approach. It provides actionable insights for policymakers, financial institutions, and environmental agencies aiming to leverage green finance and innovation for sustainable development. The evidence supports the formulation of region-specific green finance strategies, investment in renewable energy technologies, and reforms in governance to enhance institutional readiness for climate action. Ultimately, the study affirms that aligning financial flows with environmental goals is not only desirable but imperative for South Asia’s low-carbon transition and the achievement of long-term sustainability targets
Chevening Scholarship 2025-26: Insights & Application Tips
No full textThe IBA Career Development Center (CDC) organized an insightful webinar on the Chevening Scholarship, featuring Zoha Manzar (Head of Chevening Communications, Pakistan, at the British High Commission) and Muzammil Patel (Chevening Alumnus).
The speakers shared valuable notes on key aspects of the application process, including eligibility criteria, essay requirements, post-award benefits, and important do’s and don’ts for drafting a strong Statement of Purpose (SOP). The session aimed to help prospective applicants strengthen their applications and improve their chances of success
Celebrating visionaries
No full textNadeem Hussain highlights Dr Shashi Buluswar, an Indian American scientist and social entrepreneur, for his two-decade-long commitment to improving education for Pakistan’s most marginalised children. He situates Dr Buluswar’s work within a historical context of South Asian education reformers such as Raja Ram Mohan Roy, Sir Syed Ahmed Khan, Ishwar Chandra Vidyasagar, Lord William Bentinck, and Thomas Babington Macaulay. Dr Buluswar has championed access to schools in underserved communities, promoted data-driven interventions, and supported organisations like The Citizens Foundation. Hussain emphasizes that education is a transformative force for economic growth, social equity, and human development, and that investing in children’s education can break cycles of poverty. By celebrating such visionaries, Pakistan affirms its commitment to progress, human development, and nurturing socially conscious leaders
The Relationship Between AI Use and Students\u27 Originality, Innovation Level, Engagement, and Creativity: Investigating Through the Lens of Attitude Towards AI
No full textThe growing use of Artificial Intelligence (AI) tools in higher education has raised important questions about their impact on students’ learning outcomes, particularly in developing countries such as Pakistan. This study examines how the frequency of AI usage influences students’ creativity, engagement, originality, and innovation, focusing on the mediating role of attitudes toward AI and the moderating influence of Need for Uniqueness (NFU) and Susceptibility to Normative Influence (SNI).
A quantitative survey of university students in Pakistan was analysed using Structural Equation Modelling. The findings show that attitudes toward AI strongly mediate the positive relationship between AI use and creativity-related outcomes, while NFU and SNI did not significantly moderate these relationships.
The study contributes to existing literature by emphasising the central role of attitudes over personality traits in shaping how students engage with AI in collectivist cultural settings. For educators and policymakers, the results highlight the importance of fostering constructive attitudes toward AI in curricula and training, ensuring its adoption enhances creativity and innovation rather than encouraging passive reliance
Assessing the viability of green sukuk for Tier 1 capital enhancement in Pakistan’s banking sector
No full textThis study explores the potential of Green Sukuk as a Shariah-compliant financial instrument for funding environmentally sustainable projects in Pakistan, with a particular focus on its viability for Tier 1 capital enhancement within the banking sector. The mixed-method approach was adopted to retrieve the data based on the survey of 102 qualified respondents in Islamic financial institutions and subsequently analyzed through PLS-SEM. The findings indicate that the adoption of Green Sukuk is constructively affected by the aspects of financial feasibility, investor confidence, and financial gain. There was however no significant impact of regulatory issues and market demand. One of the key insights is that Green Sukuk, when properly structured to meet Basel III requirements and Shariah principles, can serve as Additional Tier 1 capital, offering banks a novel tool to strengthen their core capital while aligning with sustainability goals. Although Green Sukuk may be more expensive, they also provide competitive returns and serve the sustainability agenda. This study recommends that the State Bank of Pakistan and other regulatory bodies establish clearer frameworks to facilitate Green Sukuk eligibility for Tier 1 capital and enhance investor and issuer awareness through ESG capacity-building