Open Access Original Research Article

Deficit Financing and Economic Growth in Nigeria: A Preliminary Investigation

Akinmulegun Sunday Ojo

Journal of Economics, Management and Trade, Page 1624-1643
DOI: 10.9734/BJEMT/2014/10618

The fact that Nigerian economy has experienced some setbacks over the last four decades despite the growth of public expenditure cannot be overemphasized. This study thus investigates the incessant rises in government expenditure and the implications of deficit financing on Nigerian economic growth. It traces various governmental efforts in revamping the economy between 1970 and 2010, a period of 41 years.

From the literature, it was discovered that deficit financing has become an important tool to correct distortions in an economy if it is put into the most judicious use. However, in Nigeria the reverse is the case as the economy has perpetually being at disadvantages in terms of macroeconomic performance, making it a contentious phenomenon. Thus, there is need for a study to investigate this.

The data for the study were obtained from the Central Bank of Nigeria Statistical Bulletin and were analyzed using the econometric technique of Vector Auto Regression (VAR). The findings show that deficit financing had not achieved the desired results in Nigeria as revealed by negative impact of deficit financing on economic growth. This can be adduced to the prevailing socio-cultural mal-adaptation coupled with perennial corrupt practices in the economy.

The study recommends that government should reduce wastage in public spending, ensure greater budgetary discipline and adopt a financial structural transformation. In addition, reviewing and rationalizing the existing government parastatals with a view of pruning down the number to a reasonable level was also recommended among others. This is necessary for effective expenditure control purpose.

 

Open Access Original Research Article

Embracing Continuous Auditing: A Case for Public Sector in Kenya

Christopher A. Moturi, Peter N. Gaitho

Journal of Economics, Management and Trade, Page 1644-1654
DOI: 10.9734/BJEMT/2014/10123

Aims: The objective of this study was to assess the current state of continuous auditing in the state departments in Kenya and to adapt a framework to implement continuous auditing by the Public Sector Audit Organization.

Study Design: Adoption of existing model and survey using questionnaires.

Place and Duration of Study: Kenya, 2013.

Methodology: Existing continuous auditing models were studied and the Integrated Continuous Auditing, Monitoring and Assurance Conceptual Model was adopted for use.  The model was tested using data collected using questionnaires. Data was collected from 76 auditors in the Public Sector Audit Organization. A database system of a government Ministry was used to demonstrate how data can be obtained directly from a client system.

Results: The study found the need for training in the skills required for continuous auditing and the acquisition of IT resources and infrastructure were necessary in realizing continuous auditing.

Conclusion: The paper shows that Public Sector Audit Organization in Kenya, like institutions in other countries such as USA [8] and Australia [11], are preparing to advance from traditional audit to continuous auditing. The Integrated Continuous Auditing, Monitoring and Assurance Conceptual Model would offer a good starting point.

 

Open Access Original Research Article

The Influences of Corporate Social Responsibility to Customer Repurchases Intentions, Customer Word-of-Mouth Intentions and Customer Perceived Food Quality of Fast-Food Restaurants in Hong Kong and the Mediating Effects of Corporate Reputation

Canon Tong, Anthony Wong

Journal of Economics, Management and Trade, Page 1655-1678
DOI: 10.9734/BJEMT/2014/11311

Aims: Market studies indicate that Hong Kong consumers are affluent and generally live a trendy, refined lifestyle. As such, besides traditional food markets, Hong Kong’s free market economy has spawned various forms of food retailers, such as supermarkets, fast foods chains and fine dining restaurants, that contribute tremendously to its economy. In the face of fierce competition, companies in the food retail service industry are moving to differentiate themselves by embracing non-traditional, contemporary means of demarcation. One such means is by adopting corporate social responsibility (CSR) as a strategy for evoking positive customer behaviour towards the service. However, there is a dearth of research on CSR’s contribution to corporate reputation and its direct relationship with service industry eminent marketing concepts. This research investigated the role of CSR in building a better brand through corporate reputation and its effects on word of mouth intentions, repurchase intentions and customer positively perceived food quality in Hong Kong’s fast food industry.

Study Design:  The research adopted a positivism paradigm and quantitative cross sectional approach.

Place and Duration of Study: The study was taken in Hong Kong between 2012 and 2013 of fast food restaurant patrons.

Methodology: Five constructs were adopted from previous studies to identify the relationships between various antecedents and to test ten hypotheses. Data were collected from 384 fast food restaurant patrons in Hong Kong.

Results: CSR is found to be directly related to corporate reputation, which is considered to be an important tool for business sustainability. Furthermore, the research revealed the partial mediating effects of corporate reputation on the relationship between CSR and customer behaviour and intentions. CSR provides a competitive advantage to fast food businesses as it plays a huge role in inducing positive word of mouth, repeat purchases, and positively perceived food quality.

Conclusion: The research has raised issues concerning the importance of CSR in changing customer behaviour and the pertinent partial mediating role played by corporate reputation in influencing CSR’s impact on customer behaviour and intentions. Findings from the research provide marketing information concerning CSR initiatives as well as verifying CSR-related theories, corporate reputation and marketing concepts. As service is known to vary according to the context in which it is offered, it is best for retail managers to identify CSR activities that best reflect their particular product or service. This will make it easier for customers to comprehend and evaluate, which will ultimately benefit Hong Kong’s fast food industry as a whole.

 

Open Access Original Research Article

Corruption, Governance and Public Spending in Nigeria: Implications for Economic Growth

Okey O. Ovat, Eduno Ededet Bassey

Journal of Economics, Management and Trade, Page 1679-1699
DOI: 10.9734/BJEMT/2014/10531

The paper examines the nexus between corruption, governance and public spending and their aggregate effects on economic growth in Nigeria. It maintains that corruption is one scourge and social malaise that militates against good governance, using public spending as one of its conduits to slow down the pace of economic growth in Nigeria. It further traces the root-causes of corruption as well as its dimensions and contends that corruption which is an age–long phenomenon is ubiquitous, permeating the very fabrics of every society irrespective of whether it is a developed or developing nation and not taking cognizance of the economic system in practice, whether planned or market economy. The paper raises and attempts to answer the following research questions: Is there more corruption in Nigeria now than in the past? Is there any correlation between corruption, governance, public spending and economic growth? Does corruption impede governance and hence economic growth and development in Nigeria? To provide panacea to the aforementioned questions and to serve as a basis for sustainable policy action, the paper adopts a descriptive methodology based on analysis of stylized facts on corruption perception indexes, governance, public spending and some social and macroeconomic aggregates. The results indicate that corruption was endemic in Nigeria between 1996 and 2005 but witnessed a slight reduction between 2006 and 2012.The slight reduction notwithstanding, Nigeria is far from being perceived clean. This is due to the fact that between 2006 and 2011 Nigeria has CPI scores of less than 3 out of 10 and  27 out of 100 in 2012 which is far below 50 and ranks 139 out of 176 in 2012. Given this result, Nigeria cannot be perceived clean. The results show a clear correlation between corruption, governance, public spending and economic growth with adverse aggregate effects on economic growth and development in Nigeria. Which in concrete terms manifest in un-inclusive growth, as evidenced by rising incidence of poverty, unemployment rate, discomfort index, low capacity utilization, low level of investment among others. Since good economic performance is desirable by every nation, the paper made some recommendations aimed at engendering inclusive growth and development in Nigeria.

 

Open Access Original Research Article

Agriculture and Manufacturing Sector Growth in Namibia During the Period 1981 to 2012: A Granger Causality Test

Milner Siboleka, Jacob M. Nyambe, Rigmar Osterkamp

Journal of Economics, Management and Trade, Page 1700-1707
DOI: 10.9734/BJEMT/2014/9299

Namibia became independent in 1990. Since then, the democratic government has pursued various development policy tools to empower Namibians economically. The 4th National Development Plan identified four strategic economic growth enhancing activities, namely agriculture, manufacturing, logistics and tourism. Agriculture remains the largest employer while manufacturing, logistics and tourism are growing, but slowly. This paper is premised on investigating whether or not there is a causal and long term relationship between agriculture and manufacturing sector growth over the period 1981-2012. Ascertaining the direction of the relationship is part of the objectives. Analytical methods that were used include unit root, correlation test and a Granger Causality model. With the use of time series data, the results confirmed stationarity of the data. With 31 observations, no causal relationships were established between agriculture and manufacturing in Namibia. Appropriate policy interventions are required to influence how the two sectors should benefit from each other. Such holds potential for both sustained employment creation opportunities and economic growth in Namibia.

Open Access Original Research Article

A Study of the Coupling Degree between the Profitability and Risk Management Capability of Commercial Banks

Yan Chao, Song Wei, Peng Xiaobao

Journal of Economics, Management and Trade, Page 1723-1735
DOI: 10.9734/BJEMT/2014/11164

Based on the study of profitability and risk management capability index of commercial banks, this paper establishes a coupling model for profitability and risk management capability of commercial banks and conducts an empirical research based on data contained in 2012 annual reports of commercial banks listed in the form of A Shares in china, with results showing that the profitability and risk management capability of domestic listed commercial banks are at the stage of moderate coupling, upon which relevant suggestions are concluded.

Open Access Original Research Article

Determinants of Agricultural Export Trade: Case of Fresh Pineapple Exports from Ghana

David Boansi, Boris OdilonKounagbéLokonon, John Appah

Journal of Economics, Management and Trade, Page 1736-1754
DOI: 10.9734/BJEMT/2014/10773

Aims: This study is purposed on informing future trade policy decisions on how the fresh pineapple export industry of Ghana can be revitalized following declines in both volumes and value of exports since the year 2004. To achieve this, effort is made to identify and assess the magnitude and effects of key determinants of fresh pineapple exports from Ghana for the period 1984-2009

Study Design: The study involves separate consideration of value and volume of exports as explained variables, and sourcing of ways by which beneficial implications noted could be maximized for both variables, while minimizing adverse ones in the process.

Place and Duration of Study: This study solely involves the use of secondary data and own-computations on volume and value of pineapple exports, production, domestic demand, export price faced by exporters, terms of trade index of exports, real effective exchange rate, comparative export performance index and net inflow of foreign direct investment

Methodology: Separate regression with value and volumes of exports as explained variables were estimated with the Ordinary Least Squares estimator, and tested for appropriate standard Gaussian assumptions, appropriateness of specification and stability of coefficients

Results: The results show that Ghana’s fresh pineapple export industry has competitive advantage and is more price-driven than volume driven. Both volume and value of exports have positive association with production, openness to trade, and the index of competitiveness. Both however have an inverse association with domestic demand and net inflow of foreign direct investment. In as much as the value of exports increases with export price faced by exporters, the response for volumes exported is not significant. The effect of lagged volume of exports on both explained variables is as well not significant.

Conclusion: Reviving the fresh pineapple export industry requires increasing production (to be achieved through creation of favorable production conditions), improvement in quality of produce exported, improvement in the country’s openness to trade, and minimization or avoidance of domestic market capturing and tariff jumping types of foreign direct investments.

 

Open Access Short Research Articles

Corruption, Institutional Quality and Economic Performance in an Emerging Economy: Lessons from Nigeria

Peter Ubi, E. B. Udah

Journal of Economics, Management and Trade, Page 1708-1722
DOI: 10.9734/BJEMT/2014/11091

The need to promote and sustain a virile economy has continued to be a major concern of most governments worldwide, including Nigeria. The reason for this is not farfetched. For instance, a developed economy offers prospects for increased employment, greater efficiency and improved balance of payments and increased standard of living. But in Nigeria, improved economic performance has over the years been marred by social vices such as institutionalized corruption which hinders the capacity of institutions to efficiently deliver services necessary to grow the economy. This paper descriptively and quantitatively examines how corruption and institutional quality in Nigeria have impacted on economic performance. In the light of the above, it was found that corruption and institutional quality (measured by contract intensive money) have statistically significant effect on economic performance in Nigeria. Thus, it is recommended that aggressive re-orientation and education of the masses and other key decision makers on the need to desist from rent-seeking activities is necessary. Once the scourge of corruption is successfully tackled, institutional quality will be strengthened and the much desired people centered economic growth will be achieved.       

 

Open Access Review Article

Changing Role of Management Education towards Managerial Skills Set

Akella V. Rama Srinivas, Ramachandran Venkatapathy

Journal of Economics, Management and Trade, Page 1755-1771
DOI: 10.9734/BJEMT/2014/9519

This paper deals with the direction in which the management education moves in future.  With this aim the problem statement, purpose of the study and structure of the study are presented. The purpose of the study is to determine the skills which are more critical for business leaders to adequately prepare managerial and professional for organizational success. The structure of the study is planned to conduct intensive study on managerial skills set. Under theoretical background, the contributions by management gurus were reviewed to get a clear view on the current status of management and management education. Technology played a vital role as an important driver of management education and creator of strategic options for program delivery while implementing the management curriculum. This paper further analyses the resource of business school that need to serve the requirement of the corporate world.  In this connection, the history of management education, emergence of global markets with technological inspiration, the power shift of global economy from west to east with need for managerial skills set is taking place. Further, the present perspectives of business education are presented along with the role, impact and future of management education. In this descriptive research, a conceptual presentation, transformation of the managers role with managerial and organization effectiveness is presented. The paper analyses with the analysis of past contribution on managerial skills set along with major findings. The paper concludes that managerial skills set are emerging in the curriculum development of business school.  While arriving the conclusion, a descriptive research of managerial skills set is introduced as a collective way for imparting training managerial skills sets which are in line with expectation of employers from the graduates of management.

Open Access Review Article

Industrialization and Economic Development in A Multicultural Milieu: Lessons for Nigeria

Lionel Effiom, Enang Bassey Udah

Journal of Economics, Management and Trade, Page 1772-1784
DOI: 10.9734/BJEMT/2014/10943

While the multicultural structure of Nigeria is seen as a curse rather than a blessing, this paper contends otherwise. It relates multiculturalism to the very subject of industrialisation which has eluded our national economy for decades since independence. Its main thesis is that for Nigeria to develop industrially, it must indigenise technology contemporaneously with the pursuit of foreign direct investment inflow, as well as other conventional policy instruments. The indigenisation of technology must proceed from the comparative industrial strengths of the various multicultural groups in Nigeria. The government must re-learn the lost industrial lessons of the Nigerian Civil War (1967-1970) and also pursue the path of fiscal federalism but moderated by a fair design of central redistribution mechanism of the oil revenue needs in order to avoid “immiserizing growth”. Thus, Nigeria’s multicultural milieu provides the credentials and seeds needed to drive the industrialisation process.