Business: Theory and Practice

Logistics performance index in international trade: case of Central and Eastern European and Western Balkans countries

Filip Ž. Bugarčić, Viktorija Skvarciany, Nenad Stanišić — Thu, 25 Jun 2020 15:30:27 +0300

The volume of international trade heavily depends on factors facilitating trade and contributing to reducing its costs. The importance of international logistics as trade facilitator is increasingly emphasised in the literature. The aim of the paper is to assess the level of the impact of logistics performance on trade volume in the Central and Eastern European countries (CEECs) and Western Balkans. In order to achieve the aim, the impact of Logistic Performance Index (LPI) on international trade in 2007 and 2018 is investigated. This relationship is examined using the gravity model approach with a focus on overall LPI and its components. The research results show that there is a positive statistical significance and impact of logistics on bilateral trade between CEECs, and logistics justifies the role of a trade facilitator. Besides, the importance of LPI components in intensifying international trade was emphasised. Research implications indicate that improving logistics performance and logistics services lead to a positive impact on the volume of international trade. Better logistics performance in trading countries will lead to increased bilateral trade and reduced trade costs. The limitation of the research is that only two years have been taken into account. This is done in order to highlight the differences between the year the LPI was introduced, and the last year the LPI was calculated.

Forecasting banks return on equity using leading economic indicators

Daiva Jurevičienė, Darius Rauličkis — Tue, 30 Jun 2020 12:51:40 +0300

The research examines an approach to forecast return on equity using leading economic indicators for short periods in banks. ROE is one of the most important ratios for performance measurement. Its adequacy is necessary for competitiveness, attract funding in financial markets, accumulate reserve for future turbulences, secure compliance with supervisory requirements and maintain positive signals for the market. There is still a debate in the literature on factors of commercial banks’ profitability forecasting, techniques, and most appropriate models to improve the correctness of predicting and acquiring more accurate signals for communication on targets. The problems are still relevant from both a theoretical perspective and practical implementation. This research aims to prove the necessity to include leading economic indicators for short term ROE forecasting. It conducts investigations for the relevant studies, using regression analysis, necessary tests, ascertains opportunities and limitations of using these indicators and develops a conceptual model and its assessment major Baltic banks. The results show verification of approach to forecast ROE using leading economic indicators for short periods. Such study complements signalling theory with a new approach, how to predict and acquire signal not only using economic indicators as a general group but sub-group them into coinciding, lagging and leading.

Audit committee characteristics and sustainability performance in Nigerian listed banks

Alex Adegboye, Stephen Ojeka, Oluwaseyi Alabi, Udochukwu Alo, Adenike Aina — Tue, 07 Jul 2020 09:33:12 +0300

This study investigates the influence of audit committee characteristics on the sustainability disclosure among the Nigerian listed banks. Using the Fixed Effect regression estimator of panel data for ten (10) listed banks in Nigeria over the period of 2014–2016, the result shows that the influence of audit committee independence and gender diversity of audit committee are significantly positive on the sustainability disclosure. However, the audit committee magnitude has a negative and significant influence on the sustainability disclosure. This paper is unique as we consider the importance of the gender diversity of the committee given its relative contribution to sustainability reporting quality. This study tends to provide insights on sustainability reporting and assist stakeholders in emphasizing on the importance of sustainability disclosure through the audit committee oversight.

Development of a methodology for managing of service packages supply differentiation in the modern tourist market

Uladzimir Ganski, Viktar Tsybouski , Vital Kazlovski, Weidi Zhou — Tue, 18 Aug 2020 09:11:50 +0300

The modern tourism market is characterized by an increased struggle of tour operators for consumers and meeting their needs. Today a condition for the successful functioning of travel companies is the increasing differentiation of supply and the expansion of the range of package tours and services. However, any solutions should be preceded by their theoretical development. During the course of article writing, the authors set themselves as a goal is an analytical understanding of the methodology for managing the differentiation of package tours and services in order to solve the problem of ensuring high consumer value based on their differentiation by consumer characteristics, regardless of the type of services package and the purpose of travel. The article substantiates the feasibility of managing the differentiation of package tours as a source of increasing their consumer value in the dynamics of consumer expectations, and also presents a new author’s methodology for studying the process of differentiation of package tours. The results of study are of theoretical and practical significance. They can be used as a basis for further scientific research, and they can also be used in the practical activities of tour operators to differentiate their offer in the market and thereby increase their competitiveness and increase profits.

Board capital and bank efficiency: insight from Vietnam

Maria Kontesa, Esmie Obrin Nichol, Jia-Sing Bong, Rayenda Khresna Brahmana — Tue, 18 Aug 2020 09:59:12 +0300

This study investigates the role of board capital on bank’s efficiency for a sample of 45 banks in Vietnam over 2011–2015. Using robust panel regression, we find board capital is important in making Vietnamese bank efficient even after controlling its endogeneity issue. This study further documents that networking capital and experience capital are the important factors, but not education for bank efficiency. The findings of this research contribute to the entrenchment hypothesis in agency theory, where networking and experience can be the bargaining power for manager (agent) in securing their compensation. It also contributes to human capital theory and resource base view theory where it shows networking and experience are stratetic human capital resources for bank efficiency. The findings imply that shareholders should consider the networking and experience of board members during board elections. Future research may engage with the intervention of corporate governance monitoring or test it in other developing countries context.

Social protection and employment in Africa’s agricultural sector

Tue, 18 Aug 2020 10:39:54 +0300

Social protection is increasingly becoming a powerful tool for enhancing productivity and employment and is, therefore, important for Africa’s agricultural transformation. Thus, this study aims at examining how Africa’s agricultural sector can be transformed through social protection policies and programmes for employment. It applies the Feasible Generalised Least Squares (FGLS) econometric method on a panel of 38 African countries with the data sourced from the Country Policy and Institutional Assessment (CPIA) and World Development Indicators (WDI) for the period 2005–2017. The results from the study show that social protection has a positive impact on employment outcomes through various channels such as building human resource, equity in the use of public resources, social inclusion, among others. The study concludes by recommending that the governments of African countries should implement effective social protection programmes and policies in the agricultural sector in form of insurance, in-kind and cash support, among others to make farming attractive, thereby increasing employment and productivity.

Competitiveness factors in the innovative enterprises in the North-East voivodeships in Poland

Kamil Decyk — Tue, 18 Aug 2020 12:34:24 +0300

The research problem was the connection about the problematics of competitiveness factors with the planned action of innovation within the managing of the enterprise. In such research area the purpose of the study was to identify and evaluate the competitiveness factors used in innovative companies while taking into consideration companies’ ownership of long-term plan of action connected with managing the innovations. To achieve this objective, the following research methods were used: analysis of national and foreign literature resources, survey measurement (observation technique), direct and indirect interview, research tool: questionnaire. The results were analysed with statistical methods such as arithmetic mean, test of Kruskal-Wallis, Chi-square test (χ2), and measure of association including Cramér’s V coefficient were applied.

Based on research results and mentioned statistical tools, it was stated that having of long-term plan of action connected with innovations statistical significant affected on the evaluated competitiveness factors (innovativeness, quality, marketing and logistics activities) except the price. It was confirmed in such wat the first research hypothesis. The research also showed a relationship between competing using innovativeness and having an action plan related to innovations, however, this relationship was not statistically significant. As a result, the research hypothesis can be neither rejected nor confirmed. In practical terms, the conducted research points out the competitiveness factors which are suggested to use by the innovative enterprises in order to improve their competitiveness against competitiveness and in surroundings of knowledge based economy, as well the digital economy. Results of the research indicate at the same time, the necessity of development of long-term plan of action connected with innovations, which provides bigger possibilities in range of usage of competitiveness instruments on the market by enterprises.

Understanding strategic alliance life cycle: a 30 year literature review of leading management journals

Mayank Dhaundiyal, Joseph Coughlan — Thu, 27 Aug 2020 13:42:51 +0300

This paper contributes to the strategic alliance literature by undertaking a literature review of the burgeoning strategic alliance literature published in the last three decades in the mainstream management journals to fulfil two primary objectives. First, to bring a coherent structure into the fairly vast and growing alliance literature and second, to serve as a medium for a holistic understanding of the major life stages of strategic alliances. This is done by first dividing the alliance literature into three distinct yet related alliance life stages namely the pre-alliance stage, alliance formation stage and the alliance management and performance stage, and then by discussing in detail the three alliance stages individually. The paper would be useful for academics as well as practitioners looking to get a holistic understanding of strategic alliances and its three distinct yet related life stages and the key research papers which have been published focussing on each of these alliance stages.

Eco-innovation as a pillar for sustainable development of circular economy

Jelena Stankevičienė, Marta Nikanorova — Thu, 27 Aug 2020 13:44:05 +0300

Circular economy (CE) is based on environmental, economic and social dimensions which aim to ensure sustainable development on each step of product creation, transformation and conversion by creating a closed-loop economy. The purpose of the article is to propose a concept of measurement the development of eco-innovations in the context of circular economy, apply and provide empirical evidence based on the data of Baltic Sea Region countries. The study augmented for the models that include the analysis of the circular economy concept, the importance of eco-innovation in the context of circular economy including the accent on recycling, circular material usage, material efficiency and waste management. The multi-criteria decision methods MULTIMOORA and TOPSIS were used to assess the eco-innovation as a pillar of circular economy. Results are useful to add to theoretical building and also evaluate the socio-economic aspect in the concept of circular economy.

Assessing variables affecting the financial distress of state-owned enterprises in Indonesia (empirical study in non-financial sector)

Nur Sayidah, Aminullah Assagaf — Tue, 01 Sep 2020 08:56:19 +0300

The financial distress of state-owned enterprises (SOEs) has become the main focus of numerous researchers due to the ongoing financial burden on the state and their inability to secure independent funding. The purpose of this study is to investigate the variables that affect the financial distress of SOEs in Indonesia that have received government subsidies. This research is a quantitative study conducted using secondary data collected from the Indonesian Stock Exchange, from a total of 19 SOEs from 2014 to 2017. The analysis found that investment (X2INV), leverage (X3LEV), cash flow from operating (X4CFO), and firm size (X5SIZE) have a significant negative effect on financial distress in SOEs. It means that increases in these variables will reduce the potential for corporate financial distress. While the independent working capital (X1WC) variable has no significant effect on financial distress, because it is temporary and has a dynamic change, so it is unable to show its influence on financial distress. SOE’s management that receives government subsidies can increase the amount of profitable investment to increase marginal revenue, thereby reducing financial distress. Higher leverage can reduce the level of financial distress, indicating that management uses debt to finance projects that generate higher marginal revenue than marginal costs. This condition has an impact on increasing operating cash flow. The higher the operating cash flow will reduce financial distress.