Open Access Original Research Article

Cotton Lint Export Trade in the Midst of Distortion: What are the Competitiveness Statuses of Major Players in the Industry? Case of 12 Selected Countries

David Boansi, Boris Odilon Kounagbé Lokonon, John Appah

Journal of Economics, Management and Trade, Page 1785-1803
DOI: 10.9734/BJEMT/2014/11913

The world’s cotton production and export industry has for some time now witnessed protests from various producers and exporters on distortionary measures (notably subsidies) instilled by some major players (including the United States, India and China) and the downward pressure such measures induce on world cotton prices. To complement research efforts made and findings so far following such protests, we sourced assessment of the competitiveness statuses of twelve major players in the industry amidst such distortions. In so doing, we made use of the logarithmic form of the comparative export performance index (ln (CEP)), basing our decisions on newly introduced thresholds founded on seven-year-mean performance indices. In addition, we used mean deviation for the last four of the seven years covered to identify recessions and improvements in export performancefor the respective countries.  The results show that, although such distortionary measures (specifically production and export subsidies) are instilled with a purpose of protecting respective local industries, they sometimes turn-out not only harming players from other economies, but also “push-out” extra revenues that may have been earned by some of the countries (primarily larger exporters like United States) that instill them. Based on seven-year mean index values used for the period 2005-2011 and new thresholds employed, we found Burkina Faso, Uzbekistan, Mali, Chad, Benin, Cameroon, and India to be “Highly Competitive”. The United States (US), Australia, and Côte d’Ivoire were found “Competitive”. Upon the index values observed (limited however by our inability to incorporate economic prices and account for differences in domestic resource costs and market structure), Brazil and China were respectively found “Weakly Competitive” and “Uncompetitive”. In spite of these statuses however, we discovered that export performances for the United States, Uzbekistan, and all the WCA countries (except Burkina Faso) have receded in recent years. Performances for India, Australia, China and Brazil have however improved, with the latter two witnessing relatively higher improvements. By this, we conclude that distortions do not only harm countries from the WCA and other developing nations, but also adversely affectperformance of the United States. In countries like India, China and Brazil however, subsidies have yielded beneficial implications for export performance. These differences in effect of subsidies for the four subsidy-levying economies could be due to differences in resource, cost of production and exports, and market share.

Open Access Original Research Article

The Effects of Diagnostic and Interactive Performance Measurement Systems on Organisational Commitment and Job Satisfaction: The Perception of Information and Communication Technology Practitioners in Hong Kong

Canon Tong, Michelle Suen, Anthony Wong

Journal of Economics, Management and Trade, Page 1804-1833
DOI: 10.9734/BJEMT/2014/10056

The rapid and accelerating development of information and communication technology (ICT) has caused an unprecedented expansion in Hong Kong’s ICT industry and a simultaneous increase in the demand for ICT practitioners. With the intention of helping ICT-related companies in Hong Kong retain valuable employees, this research identifies the effects of diagnostic and interactive use of performance measurement systems (PMS) on organisational commitment and job satisfaction. The research adapted the measurement from [1] and [2] in diagnostic and interactive performance measurement, organisational commitment were adapted from [3] whilst job satisfaction with five dimensions of compensation was adapted from [4]. With a critical review of these related literatures, two research questions and five hypotheses were formulated to explore ICT practitioners’ perceptions of job satisfaction, organisational commitment and PMS. An Internet-based anonymous questionnaire, using measures adopted from previous validated research, collected the research data. Six thousand invitation emails sent to randomly selected ICT practitioners in Hong Kong provided 302 responses for statistical analysis. Findings indicate that diagnostic and interactive use of PMS positively influences the job satisfaction and organisational commitment of employees and suggest that job satisfaction and organisational commitment are correlated. The study also found that employees’ position in the organisation and the nature of the business influences both job satisfaction and commitment, but that their marital status only influences job satisfaction and not organisational commitment; other demographics have no influence on either satisfaction or commitment. Results from this study provide insights for managers and owners of companies in Hong Kong’s ICT sector by suggesting how they can formulate appropriate strategies to reduce staff turnover. The research contributes to the literature related to the appropriate use of PMS in ICT organisations as a means of improving organisational commitment and job satisfaction.

 

Open Access Original Research Article

Credit Constraints: Its Existence and Determinants among Poultry (Egg) Farmers in Nigeria

O. I. Afolabi, D. A. Adegbite, S. O. Akinbode, O. F. Ashaolu, A. M. Shittu

Journal of Economics, Management and Trade, Page 1834-1848
DOI: 10.9734/BJEMT/2014/10018

Access to productive resources at the level sufficient for economic and scale efficiencies by farmers is constrained by limited resource endowment and poor access to farm credit. This study examined the existence and determinants of credit constraint on poultry egg farmers in Nigeria. Primary data were collected from 120 farmers drawn by a multi-stage sampling technique. Descriptive statistics, Probit regression and Test of Difference of Means were used to analyze the data. The study revealed that 90% of the respondents were male, 77.5% were married with 95% being literate. The mean age and years of experience were 43 years and 8.7 years respectively. High transaction cost of loans (56.7%), fear of losing asset (35.8%), and credit rationing by banks (65%) were conditions determining the credit constraint status of farmers. The findings further showed that age (p<0.05), marital status (p<0.1) and years of experience (p<0.01) of the farmer significantly affect the credit constraint status of the farmer. There is significant difference between the gross margin of credit constrained and unconstrained farms (α=0.01). This study recommends that farmers should join or form cooperative societies in order to enhance credit accessibility. Increasing and channelling credit support through cooperative societies will enable farmers to increase their flock size which will invariably increase their profitability and efficiency.

 

Open Access Original Research Article

Knowledge Capital Creation: The Case of Polish Economy

Anna Wildowicz-Giegiel

Journal of Economics, Management and Trade, Page 1849-1860
DOI: 10.9734/BJEMT/2014/8543

Knowledge, and its application, is perceived as one of the key sources of competitiveness and growth in the global economy. In actuality, all kinds of intangible resources available to a country or region can offer a relative advantage and, in combination with others, yield future benefits. The importance of investment in knowledge, innovation, education and ICT was particularly exhibited in the Strategy Europe 2020 in the face of long-term global challenges such as climate change, scarcity of resources or adverse demographics. Without a doubt, these problems also affect the Polish economy which aspires not only to near averages of European competitiveness, but wanting to become one of the most competitive countries in the EU-27. The main purpose of the paper is to show the progress in the knowledge creation in Poland against the background of the EU-27 countries. Looking at the knowledge creation process through the prism of institutional approach, such an approach enables the identification of key barriers that have impeded this process thus far. The analysis confirms that one of the necessary prerequisites of effective knowledge creation is a friendly institutional environment which encourages the development of intellectual capital. The paper also explores the relationship between investment in knowledge capital and national competitiveness. Unfortunately, many empirical findings and statistical data suggest that Polish economy still suffers from permanent underinvestment in intellectual capital. It may thus hamper long-run economic performance and competitiveness. In a broader sense, the causal relationship between intellectual capital commitments and economic competitiveness is a function of governance standards. The aforementioned research is based not only on selected prior literature focused on intangible capital but it is also to be backed by broad empirical findings and statistical data derived from Polish and international think tanks.

Open Access Original Research Article

Decision Theory and Its Relevance to Real Estate Development Decisions

Daniel Ibrahim Dabara, Ankeli Ipkeme Anthony, Odewande Adeleye Gbenga, Oluwasegun Adeyanju

Journal of Economics, Management and Trade, Page 1861-1869
DOI: 10.9734/BJEMT/2014/5574

The major purpose of this study is to critically examine decision theory with a view to identifying and evaluating its relevance to real estate development decisions. The theoretical research approach was adopted for this study. The study revealed that real estate development involves taking risk and is often characterized by great complexities and inherent uncertainties.  The study showed that since resources are limited, a choice has to be made among the various real estate investment alternatives. The study further showed that decision theory is very much relevant in real estate development decisions because by assessing the risks, complexities and uncertainties associated with real estate development, the decision maker is better placed to make a more informed and “better” decision. It was recommended that real estate appraisers should familiarize themselves with the various relevant decision models appropriate for real estate development decision-making. This will help them to better serve their clients by making better decisions on viable real estate developmental projects.

 

Open Access Original Research Article

The Economic Survey of Walnut Production in Iran

Bakhshinejad Mahmoud

Journal of Economics, Management and Trade, Page 1870-1878
DOI: 10.9734/BJEMT/2014/9896

This paper assessed the comparative advantage of walnut production in Iran and determined that how far the current set of policies is consistent with the comparative advantage. The domestic resource cost (DRC) has been applied. DRC method relies on production cost data to compare efficiency. Distortions may require the estimation of shadow prices to reflect true social opportunity costs but, when adjusted, the country that has the lowest DRC has a comparative advantage. The DRC method is dynamic, providing useful information to decision-makers. However, DR Cwere used for the analysis of data for the five harvesting years, 2007-2008 to 2011-2012. The analysis was carried out in the context of Policy Analysis Matrix (PAM). The Domestic Resource Cost (DRC) analysis for Iran concluded that Iran had comparative advantage in producing walnut for the study period.

 

Open Access Original Research Article

Occupiers’ Perception of Commercial Leases: Empirical Evidence from Ede, Nigeria

Daniel Ibrahim Dabara, Ankeli Ipkeme Anthony, Oluwasegun Adeyanju, Odewande Adeleye Gbenga

Journal of Economics, Management and Trade, Page 1879-1888
DOI: 10.9734/BJEMT/2014/5575

The purpose of this study is to examine the perception of commercial property occupiers’ towards their lease structures, terms and duration (LSTD) in Ede, Nigeria. Questionnaire survey was carried out to elicit for information from the occupiers’ in the study area. The targeted population for the study consisted of 917shops in prime commercial areas of Ede. The sample size adopted was 12% of the population. The random sampling technique was used in selection of the sample size for the study. Structured questionnaires were administered to shop owners in the study area, which totaled 150. However, only 113 questionnaires were retrieved (i.e 75% response rate). The results from the 113 responses were collated and analyzed using both descriptive and inferential statistics. The study revealed that most occupiers in the study area are satisfied with their current lease duration which is mostly of a year (renewable) duration; most of the occupiers are however dissatisfied with some of the terms in their lease structure. It was recommended that the government should intervene in the real estate rental market in Nigeria by harmonizing the LSTD in the country. Leases should also be structured in such a way that it will be acceptable and satisfactory to both the lessees and the lessors. This will help in the mitigation of the constant conflicts experienced among stakeholders in the Nigerian rental property market as well as address the mismatch between what occupiers’ desire and what lenders or lessors provide.

Open Access Original Research Article

The Impact of Overconfidence on Entrepreneurial Process: Entrepreneurs versus Students

Salima Taktak, Mohamed Triki

Journal of Economics, Management and Trade, Page 1889-1904
DOI: 10.9734/BJEMT/2014/10927

Empirical research documents that overconfidence has a strong impact on investment decision. In this experimental study using a within-subject design and entrepreneurial process, we detail this relationship by introducing a stage of identification (initial knowledge about the entrepreneurial opportunities to invest in) and evaluation (forecasts to be made) before the investment decision. We also examine the role of expertise by comparing a group of entrepreneurs (320 Tunisian entrepreneurs) and a group of students (70), control in the role of risk aversion, and implement different measures of overconfidence (miscalibration in two formats – the BTA effect and the illusion of control). Our results show that no differences were observed between entrepreneurs and students in the degree of overconfidence. However, overconfidence seems to determine decision-making in a different way across the two groups. Concerning students, we observed that overconfidence influenced general tasks such as identification of the entrepreneurial opportunities but when it came to investing, risk aversion had a major effect. In contrast, entrepreneurs were strongly influenced by their overconfidence. For them, it mainly affected specific tasks (evaluation and investment choices) but, surprisingly, risk aversion had no effect on investment decision. Our results suggest that introducing an entrepreneurial opportunities in the decision process is an aid to understanding the differences between experts and novices.

 

Open Access Original Research Article

Inter-cities Relationships in the Process of “Global Economy’ Urbanization”

Denis Ushakov

Journal of Economics, Management and Trade, Page 1905-1921
DOI: 10.9734/BJEMT/2014/11698

Cities play a key role in the modern global economy. They became full-fledged (together with states, multinational corporations and international economic organizations) subjects of international economy relationships; concentrated financial and commodity markets, enormous productive and innovative potential of humanity. Due to these institutional and infrastructural transformations now we can consider a gradual process of “global economy’ urbanization” (term was offered by author) – concentration of global economical relationships, activities and power within a global net of cities.   

The main reasons of transformation of economic importance of cities are their advantages in comparison with State economic systems. 

Labor and capital in urban economy systems is more mobile and productive; cities are more predisposed to create and commercialize innovations. Moreover, cities are easier to connect with international markets and world trade, are able to reduce transport costs, to increase own investment attractiveness, and to rapidly form new types of business activities and forms of manufacturing organization.

This study analyzes a current system of global cities, an intensity of inter-cities relationships, a potential of global urban system transformations in a future. Original methodology of inter-cities economic collaboration’ evaluation allowed to classify modern urban economies for few types depends on their role and meaning in globalizing economy. Further interactions within a global cities hierarchy (including inter-cities competitions, inter-cities consumption and labor division and so on) will mostly identify trends and patterns of the world economy development in the nearest future. Some authors’ conclusions and forecasts about modern and future stages of global cities’ hierarchy formation are also offered in this study.  

 

Open Access Original Research Article

Shock Transmission between Export Expansion and Technological Change in Developing Economies: Evidence from Nigeria

Ayeni Raphael Kolade

Journal of Economics, Management and Trade, Page 1922-1938
DOI: 10.9734/BJEMT/2014/9510

Nigeria export earnings especially from oil, makes up over 25% of its GDP and over 90% of its annual budget. This makes the economy an attractive case study in the field of trade. This study investigated the short-run shock transmission and long-run multiplier analyses between export expansion/growth and technological changes captured by the growth in total factor productivity (TFP) estimated for the aggregate economy. For the long-run analysis the study employed the Autoregressive Distributed Lag (ARDL), the Peseran et al. (2001) Bound Testing method of Cointegration analysis while Variance decomposition and Impulse Response function were used for the shock transmission analysis. Data of sectored export trade (oil, nonoil and manufacturing) and estimated TFP between 1973 and 2012 were used for both analyses. The results provided evidence to support the bi-directional causality between export expansion and technological growth discovered by previous studies. But the magnitude of impact runs from technological growth to export expansion. Also the variance decomposition revealed that a greater percentage of variations in export expansion in Nigeria can be traced to shocks in nonoil and manufactured exports. The poor structure of these two sectors’ export trade had hindered the expansion of export in Nigeria leaving oil export (a wasted asset) to dominate. The ARDL analysis confirmed the weak immediate and long-run multiplier effect of technology growth on export expansion. It is therefore pertinent for the Nigeria government to put in place technological development strategies that will promote the nonoil sector of the economy if the economy is to enjoy and sustain the benefits of trade openness.

Open Access Original Research Article

Microfinance and Micro-Small-Medium Scale Enterprises (MSME’s) in Kasoa Municipality, Ghana

Gideon Danso-Abbeam, Isaac G. K. Ansah, Dennis S. Ehiakpor

Journal of Economics, Management and Trade, Page 1939-1956
DOI: 10.9734/BJEMT/2014/11351

Limited access to credit is one of the key factors inhibiting the growth of micro-small-medium scale enterprises (MSME’s) in developing countries like Ghana. Hence, this study sought to identify determinants of access to credit and the factors influencing the volume of credit disbursed to MSME’s in Kasoa municipality of Ghana. The study used primary data collected from 140 randomly sampled MSME’s who applied for loan from Progressive Microfinance Company limited. The paired sample t-test was used to test whether there is significant difference between the amount demanded and the amount of credit received. The study used Probit model to analyze factors influencing the probability of access to credit while the Tobit model was used to analyze the determinants of amount of credit disbursed to the MSME’s. The paired-sample t-test revealed that the amount of credit received was significantly lower than the amount of credit demanded by the MSME’s. Empirical results from the Probit regression model indicated that educational level, provision of a personal guarantor, duration in business, permanent place of business and household size are the variables that significantly influence the probability of MSME’s accessing credit from the MFI’s. Moreover, empirical results from Tobit regression model show that sales level, availability of collateral security, business income, stock level and availability of bank statement have significant influence on the amount of credit disbursed to MSME’s. The study therefore recommends that MSME’s should be granted the required loan amount to enable them achieve their investment plans, and MSME’s should be encouraged to operate bank account since it would increase their chances of accessing larger loan size.

 

Open Access Original Research Article

Motivations to Participate in International Trade Fairs: The Portuguese Experience

J. Freitas Santos, P. B. Mendonça

Journal of Economics, Management and Trade, Page 1957-1972
DOI: 10.9734/BJEMT/2014/11450

Aims: This study explores the prime motives and barriers that drive or inhibit the Portuguese exporting Small and Medium Enterprises (SMEs) to exhibit at an international trade fair.

Study design:  Survey, based on a questionnaire sent by email.

Place and Duration of Study: 68 Portuguese exporting SMEs, between January and July 2012.

Methodology: The present study was conducted in Portugal and sought to examine the firm’s behavior regarding international trade fairs. In the preliminary stage of the research process an informal exploratory study was undertaken. Then, a survey based on a questionnaire sent by email collected the primary data used in the study.

Results: The results indicate that a strong motive to exhibit at a trade fair is to reinforce the market presence of the firm, the possibility of finding new ideas and test new products, establish relationships with present and future customers, and enhance the brand image and reputation of the firm. The main barriers to non exhibitors firms were costs, bad previous experiences and lack of resources (financial, personnel and time).

Conclusion: A strong motive to exhibit at a trade fair is the reinforcement of the exporter’s market presence, particularly in international markets where the comparative costs of another promotional tools are relatively prohibitive. The main barriers to non exhibitors firms are costs associated with the participation in the venue (rents of the space and stand, travel and accommodation expenses, etc.), bad experiences on previous trade fairs, and lack of resources (financial, personnel and time).

 

Open Access Original Research Article

Credit Market and Economic Development in Nigeria

Chijioke Mercy Ihuoma, Ogbuagu Uchechi Rex

Journal of Economics, Management and Trade, Page 1973-1985
DOI: 10.9734/BJEMT/2014/12024

A developed and efficient credit market encourages savings, allocative efficiency of investible funds and promotion of capital accumulation. Countries with deeper credit market face less severe business cycle, output contraction and lower chances of an economic downturn. This will directly or indirectly boost private investment behavior in the economy. However, in Nigeria the objective of improving the level of economic development through the credit market is yet to be achieved. This may be attributed to inability of the investors to channel credit market investible funds to projects that are productive. This study therefore, examines the relationship between credit market and economic development in Nigeria using data between 1970 and 2012. A standard econometric method of error correction mechanism was adopted. Though the result shows a direct and positive relationship credit market and economic development in Nigeria, the effect of the return on investment to economic development is adverse against the Keynesian theory of investment. It is therefore, recommended that investible funds from the credit market should be restricted to viable investments.

 

Open Access Original Research Article

Work Stress and Job Performance in Malaysia Academic Sector: Role of Social Support as Moderator

Sai Mei Ling, Muhammad Awais Bhatti

Journal of Economics, Management and Trade, Page 1986-1998
DOI: 10.9734/BJEMT/2014/12098

The present study aims to investigate the relationship role conflict, job control, social support and job performance among administration staff in University Utara Malaysia (UUM), Kedah. The research was designed by using quantitative approach and survey was conducted between 6th until 17th April, 2014 in UUM. Besides, 215 questionnaires were collected to analyze the data. Results indicate that a positive and significant relationship found between job control, social support and job performance. Besides, results indicated social support moderate between role conflict and job performance showed significant relationship. Practical implication of this study able to contributes to the UUM employees to be aware of the work stress issues in their workplace and able to maintain their job performance.

 

Open Access Original Research Article

The Roles of Value Added Tax in the Economic Growth of Nigeria

F. I. O. Izedonmi, Jonathan A. Okunbor

Journal of Economics, Management and Trade, Page 1999-2007
DOI: 10.9734/BJEMT/2014/11013

Value Added Tax (VAT) was introduced by the Federal Government of Nigeria in 1993 to replace Sales Tax. The aim was to increase the revenue base of government and make funds available for developmental purposes that will accelerate economic growth. The paper empirically examined the contribution of VAT to the development of the Nigerian economy. Time series data on the Gross Domestic Product (GDP), VAT Revenue, Total Tax Revenue and Total (Federal Government) Revenue from 1994 to 2010 sourced from Central Bank of Nigeria (CBN) were analyzed, using both simple regression analysis and descriptive statistical method. Findings showed that VAT Revenue accounts and total revenue account for as much as 92% significant variations in GDP in Nigeria. A positive and insignificant correlation exists between VAT Revenue and GDP. Both economic variables fluctuated greatly over the period though VAT Revenue was more stable. This paper therefore recommends that all identified administrative loopholes should be plugged for VAT Revenue to continue to contribute more significantly to economic growth of the country.

 

Open Access Original Research Article

Impact of Customs Regulation in the Efficiency on International Trade

América I. Zamora-Torres, Francisco Javier Ayvar Campos

Journal of Economics, Management and Trade, Page 2008-2021
DOI: 10.9734/BJEMT/2014/12156

Customs clearance is a force step on international trade. The evolution and grow of international trade has made more important and complex the task assigned to customs services. Now day’s customs administration is a relevant regulatory operator in international trade and goods movements as facilitator and accelerator of trade. However, the study of efficiency on the public sector is always more complex than the study of efficiency in the private, profit-oriented sector. Due to, the measurement of efficiency in the public services implies a bigger effort in the identification of relevant outputs and inputs. The address questions are: 1. How big is the trade impact caused by customs regulation across countries on economic variables such as efficiency and 2. What measures should be taken in order to achieve the efficiency goal. The aim of this research is focused on determining the relative efficiency of countries customs as a key of international trade considering 4 inputs and 3 outputs for 29 countries through the data envelopment analysis (DEA) the findings point out that according to the global technical efficiency which departs from constant returns to scale (CRS), 8 customs houses were efficient. While the scores of the pure technical efficiency (variable returns-to-scale), 14 customs houses were efficient. The efficiency of de CRS efficiency to VRS efficiency increase which is particularly significant.

 

Open Access Original Research Article

Bootstrap Causality among Foreign Direct Investment, Exports and Economic Growth in Burundi

Arcade Ndoricimpa

Journal of Economics, Management and Trade, Page 2022-2033
DOI: 10.9734/BJEMT/2014/12454

Aims: This paper examines the causal links among Foreign Direct Investment (FDI), exports and economic growth in Burundi.

Methodology: The paper applies bootstrap causality tests to account for non-normality in error terms and the presence of ARCH effects in which case the Wald statistic does not follow the usual distribution thus biasing causality tests.

Results: The findings reveal that there is no causality whatsoever among FDI, exports and economic growth in Burundi, rejecting FDI-led export, export-led growth and FDI-led growth hypotheses.

Conclusion: The results imply that FDI and exports are not engines of growth for Burundi. Sources of growth which are desperately needed should be sought for elsewhere.

 

Open Access Original Research Article

Low Performance of Economic Growth in West African Economic and Monetary Union (WAEMU): Explanatory Factors

Ibrahima Thiam

Journal of Economics, Management and Trade, Page 2034-2048
DOI: 10.9734/BJEMT/2014/10637

Despite the strategies implemented by governments and donors over the past fifty years, the obstacles to the promotion of a strong and sustainable economic growth in the WAEMU remain considerable.

The objective of this paper is to describe the factors explaining the slow economic growth in the WAEMU and propose a series of measures to promote harmonious development. We emphasize the importance of competitiveness to support sectors of economic activity. The study shows the importance of diversification of products and partners to exchange (1), a mixed exchange rate regime (2), economic patriotism (3) access to finance for small and medium enterprises (4) good management of public finances (5) to promote a strong and sustainable economic growth in the WAEMU.

 

Open Access Original Research Article

Studies of Green Financial Performance System with Comparative Analysis of China’s Eight Economic Regions

Lan Xu

Journal of Economics, Management and Trade, Page 2049-2065
DOI: 10.9734/BJEMT/2014/12321

Green Finance directs funds to transfer to the green industries by providing environmental friendly financial services, to support technical development and creations, which plays an important role in improving ecological environment and promoting sustainable economic development. Besides, green finance, as an important part of the financial system, promote the formation of new financial products, can also help the sustainable development of financial sector itself. The purpose of this article is, by comparing the green financial implementation among China’s 28 provinces and directly affiliated municipalities and among the eight major economic regions, to research the comprehensive effects on the performance and efficiency of the financial sector by implementing the green financial policies. It also analyzes the decomposition factors that affect the green financial performance, as well as the sources that contribute to the green financial productivity growth.

This paper adopts the traditional method of production efficiency analysis, using Malmquist productivity growth index to build the evaluation system on the overall result of the green financial implementation, for which it requires to set up the green financial distance function before the productivity index can be calculated. During the process, two-stage linear optimization programming methods are used to obtain the most reliable and best-fitted distance functions.

As a result, technical progress serves as an important criterion to judge whether economic growth is sustainable, according to this study for nearly 10 years’ time period of sustainable development of China’s financial sector. It is confirmed that the sustainable development of the financial productivity also depends on the technological progress, after investigating its further sources, financial technological progress or total factor productivity (TFP) is more dependent on the management of labor inputs, while the scale effect of financial capital accumulation has minor impact.

 

Open Access Original Research Article

Dynamic Effects of Capital Flow Shocks upon Stock Market Developments in Nigeria

Anuli Regina Ogbuagu, Dennis Brown Ewubare

Journal of Economics, Management and Trade, Page 2066-2094
DOI: 10.9734/BJEMT/2014/12740

Aims: To analyze the dependent relationship between capital flow and stock market development in Nigeria.

Study Design: case study (Nigeria)

Methodology: the study employed the use of Vector Auto-regression Model (Granger – Causality Wald Test, Impulse Response Test and Variance Decomposition Test), to enable us achieve our objectives.

Scope of the Study: 1986 – 2012.

Results: the granger causality result shows that Capital Account Balance (Deju), Foreign direct investment (FDIN), Net portfolio investment (NPI), Real gross domestic product (RGDP), Exchange Rate (EXCR), does not granger cause Market Capitalization (MC). There is bi-causality relationship between Market Capitalization and Trade Openness, that is, both Market Capitalization (MC) and Trade Openness(TROP) granger cause each other. Also, A uni-directional causality exist between Debt (DEBT) and Market Capitalization. Debt granger causes Market Capitalization but Market Capitalization does not granger cause Debt.  For Impulse Response result indicates that Market Capitalization responded positively all through the year to the shock in Trade Openness, Real gross domestic product and Exchange Rate. While shocks in Dejure, NPI, and FDIN appears insignificant to Variations in Market Capitalization. Finally, the Variance decomposition analysis reveals that Market Capitalization contributes 40 percent of its own shock all through the year while the other variables accounts for the other 60 percent. Among all the selected variables, Trade Openness and Real gross domestic product seem to account for 45 percent of variation in Market Capitalization for the period under study.

Conclusion: based on our findings, market capitalization responded strongly to variations in trade openness and real gross domestic product. While shocks/changes in Deju, Net portfolio investment, Foreign direct investment and Debt appears insignificant to Variations in Market Capitalization. Showing that in all capital flow (liberalization) have not impacted on stock market development in Nigeria during the period under review.

 

Open Access Original Research Article

Assessing the Relationship between Regulatory Framework and Forensic Accounting, the Nigerian Experience

Leyira Christian Micah, Tony- Obiosulesi Ruth

Journal of Economics, Management and Trade, Page 2095-2106
DOI: 10.9734/BJEMT/2014/7600

The primary objective of this study is to investigate the relationship between regulatory framework and forensic accounting practice in Nigeria. The study adopted a survey research with questionnaire drawn to elicit responses. The results of this study show that  Nigeria Evidence Act 2011 as amended and EFCC Act 2000 give much impetus and legal backing to the effective functioning of forensic accountants in Nigeria but Political will, enabling environment and modern infrastructures which are necessary in combating financial   crime cannot be ignored.

Open Access Case Reports / Case Studies

The Impact of Creative Accounting on Organizational Effectiveness: A Study of Manufacturing Firms in Nigeria

Leyira Christian Micah, Okeoma Eunice Chinwe

Journal of Economics, Management and Trade, Page 2107-2122
DOI: 10.9734/BJEMT/2014/7736

Creative accounting involves the manipulation of company financial records towards a predetermined target. This target can be motivated by a preference for more stable earnings. The purpose of this study therefore is, to determine if creative accounting has any influence in enhancing the effectiveness of an organization. Prior studies were reviewed to develop our hypotheses. The study uses survey data and financial reports on fourteen manufacturing firms over five year period to examine whether creative accounting and organizational effectiveness has any significant relationship. Using correlation statistics, all the hypotheses were found to be statistically significant and positively correlated. However, we found weak evidence of a positive correlation between income smoothing, artificial transaction and market share. These results are sensitive to our apriori expectation but we believe they may not be consistent over time. The study concludes that many manufacturing firms in Nigeria underperform but practice creative accounting to appear legitimate. We therefore recommend that IFRS should be adopted in Nigeria to eliminate judgment estimation in accounting treatment of certain items.