Eurasian Journal of Business and Economics

1-27

Authors: Jayarethanam S. PILLAI , Aureliu SINDILA, Anna NAGORNOVA

The growth of knowledge-intensive societies has brought dramatic changes to the higher education landscape, changing the role of universities as well as academiaindustry relationship models. The changing roles of universities in teaching, innovation and entrepreneurial enthusiasm impact the national innovation systems of many developed and developing countries. This paper attempts to study existing models of university-industry collaboration in Central Asia, using structured interviews to provide analytical and practically applicable strategies to address various issues in higher education

59-81

Authors: Osman SAHIN

This study is based on the non-financial companies within the fragile five countries (Turkey, Brazil, South Africa, India and Indonesia) during the period of 2004-2013. The factors affecting capital structure were assessed along with micro and macro variables for these countries. The micro variables (firm specific) included in the model were the debt taken in the previous year, firm size, growth, industry debt average, and the tangibility and profitability ratio; GDP growth, inflation and exchange rate change were included in the model as macroeconomic variables. Also, the effects of financial crises were analyzed by treating pre- and post-2008 crisis periods separately. Panel data analysis techniques are used to identify the relationships between these determinants and capital structure. The relationship between the real effective exchange rate and the debt ratio was positive in the precrisis five-country model, but it turned negative in the post-crisis model. A statistically significant relationship was discovered between the GDP growth rate and the debt ratio only for Turkey for the full period (2004-2013) and for India for the period between 2006 and 2013. On the other hand, a positive relationship was found between the inflation rate and the debt ratio for the general (2004-2013) and post-crisis models.

105-121

Authors: Ivana BOŽIĆ MILJKOVIĆ

The aim of this paper is to measure the results of the recent economic cooperation achieved between Serbia and the member states of the Eurasian Economic Union on the basis of statistical data, and then, by applying an econometric model, to show the potential for future cooperation in the field of foreign trade and highlight the economic benefits of such cooperation. There are potentials for the development of foreign trade relations and cooperation between Serbia and the member states of the Eurasian Economic Union but they are not fully exploited. Their further development is conditioned by political relations between Serbia and the member states of the Eurasian Economic Union, and the progress of Serbia in the process of eurointegration.

1-22

Authors: David L. FORD, Laurie L. ZIEGLER, Ray FANG , Oscar HOLMES IV

Increasingly, managers of global teams are faced with the challenge of how to foster knowledge sharing within a virtual or hybrid community. In this study, we replicate Chiu, Hsu, and Wang’s (2006) study of the influence of social capital factors on knowledge sharing in virtual communities and extend it to reveal how both the quantity and quality of knowledge sharing may mediate between social capital factors and network involvement and commitment. The context of our investigation is a professional hybrid community in Central Eurasia. Using singleindicator structural equation modeling (SEM) to test our proposed model, we were able to demonstrate both convergent and discriminant validity among the study variables. Our study also provides partial support for the proposed model. Implications for research and practice are discussed

49-68

Authors: Khadra DAHOU, Ishaq HACINI

Being the most important asset, the human resource represents today the source of the organizations’ sustainable competitive advantage. This focus on the employee as the organizations’ core of human capital management drives the current interest in empowerment. This paper explores the concept of employee empowerment and the main influential factors in implementing an empowerment initiative: job design, transformational leadership, decision-making authority, continuous training and development, sharing information, and self-managed teams. Using a hypotheses testing approach, this correlational cross-sectional field study investigates the influence of the six factors on the adoption of employee empowerment. Using a questionnaire method, data was collected from Jordanian commercial banks. The results of a multiple linear regression analysis revealed that sharing information, job design, transformational leadership and decision making authority have a positive effect on employee empowerment. Sharing information and adopting the appropriate job design inside the organization have the strongest influence in that fostering these initiatives would certainly make banks’ employees’ empowerment successful. The research provides insights into the perception of employee empowerment in the Jordanian context, specifically in the banking industry, a high service- oriented sector where empowering employees become a must for a better customer service.

87-100

Authors: Irfan DJEDOVIĆ, Ugur ERGUN

This study investigates the impact of the US monetary policy, represented through the volatility of the US government bonds rate, on the return of Dow Jones UK Islamic index. Monthly observations spans, in the period between December 2006 and June 2017, are obtained from the International Monetary Fund database. The OLS regression and granger causality analysis are used to investigate the impact. The results of the analysis show that there is significant impact of the US monetary policy on the Dow Jones UK Islamic index return.

117-133

Authors: Ilker YILMAZ, Goksel ACAR

In this study we aim to examine the effects of intellectual capital and its components on companies’ market value and financial performance in Turkey. The financial and market data of production companies listed in Borsa Istanbul 100 index (BIST-100) for the periods 2011 through 2014 are used as dataset. We selected three different measures for financial performance; ROA, ROE and Net Profit Margin, and one measure for market value; Market to Book Ratio. As independent variables, we firstly took Modified Value Added Coefficient (M-VAIC), secondly we took three components of M-VAIC. Besides, we added natural logarithm of assets to control for variation in asset size of companies and tested its significance. The results suggest multi factor models are more powerful than single factor model in explaining the market performance and financial performance. The paper also reveals that models explaining financial performance provide more accurate results than the models of market performance. The analysis also exposes that physical capital and human capital has a significant effect on financial performance whereas physical capital and relational capital has an influence on market performance.

1-16

Authors: Sanjee Udari SAMARANAYAKE, Toshihiko TAKEMURA

In this article, we investigated the relationships between organizational commitment, trust in peers and management and employee change readiness. The effects of demographic factors such as gender, age, and working experience on employees’ organizational commitment, trust in peers and management and their change readiness were also examined. We conducted a cross sectional questionnaire survey to collect data from a sample of 185 randomly selected employees in an export oriented business firm in Sri Lanka. Pearson Productmoment Correlation test was used to test the strength and direction of the relationships in the hypotheses. A Multiple analysis of variance (MANOVA) was employed to analyse the relationships between demographic variables and the three main variables concerned. This article unveiled that organizational commitment and trust in peers and management were significantly and positively correlated to employee readiness for organizational change. The article also revealed the significant association of certain demographic factors with trust in peers and management and employee readiness.

33-46

Authors: Rıfat KARAKUS

The main purpose of this paper is to examine the impact of accounting variables on systematic risk of firms. By using data of 58 companies from BIST-100 Index for the period between 2006 and 2015, panel data analysis is employed. The results of the study indicate a statistically significant and positive effect of asset size, asset turnover, previous term equity to total debt and previous term cash ratio on systematic risk. On the other hand, negative influence of profitability, equity to total debt, cash ratio and previous term debt to total assets on systematic risk is detected. Also the study determines that consumer price index, previous term beta and previous term GDP per capita affects the systematic risk negatively and increase the explanatory power of the model significantly.

71-88

Authors: Oualid ABIDI, Halil ZAIM, Dina YOUSSEF, Houshang HABIBNIYA, Alper BARAN

The purpose of this paper is to analyze the Diversity Management implementation in Kuwaiti context and try to reveal its effects on human resource management practices. Data was collected through questionnaires from a variety of companies in the service sector in Kuwait. Convenient sampling method is applied. Among the questionnaires distributed 354 useful ones from 87 different companies were considered. An exploratory factor analysis (EFA) with varimax rotation is used to determine the underlying dimensions of HRM and DM. Furthermore, a regression analysis is used to measure the effects of diversity management on HRM. The major findings of this study are as follows: first, there is a positive significant relationship between Diversity Management policies and Human Resources Management practices. The “ability to manage people from different backgrounds” have the most significant effect on HRM practices, followed by “Ability to work in harmony with people from different cultures” component, then “Avoidance of discrimination” component.

105-124

Authors: Obaid Ur REHMAN

The purpose of the study is to recognize the factors influencing non-performing loan in banking system of South Asian region for the period of 1999-2015. Generalized method of moment (GMM) is used to grasp the hetero nature of data at variant countries and apply impulse response function for robustness of results. The study results reveals that NPL is influenced by both macroeconomic indicators and bankspecific variables (although the bank-specific variables found to be low explanatory power due to their time variant indulgence, which marginally surge the within explanatory impact of every group while diminishes the between influence in the fixed effect estimations). The analysis indicates that NPL response to macroeconomic determinants is more significant in the post crisis period than pre crisis period. The scenario is suggesting that the level of NPL adversely affecting the economic recovery system in South Asian region.

1-18

Authors: Meherun AHMED , Iftekhar Uddin Ahmed CHOWDHURY, SabihaSubah MOHONA

This paper uses household-level data from a nationally representative survey conducted in 2009 and 2010 in Bangladesh to determine the relationship between coping mechanisms and having access to credits. The analysis finds that more than half of the sample claimed to have faced shocks over the years. The paper also discusses the coping strategies households undertake after experiencing economic shocks. As Bangladesh is prone to natural disasters, some climatic shocks are annual in certain parts of the country. A lot of factors influence the coping strategies taken by the households. Poorer households are more likely to use coping mechanisms that may have negative implications in the long run as they include the depletion of capitals, assets, savings etc. An econometric model is used to address what might help them to cope better and whether having access to any kind of credit can help them cope, i.e., help them to take non-erosive measures when they face shocks. Policy implications include the importance of developing government programs, safety net programs and developing the networks of microfinance organizations.

37-59

Authors: Shruti SHASTRI, Arun Kumar GIRI, Geetilaxmi MOHAPATRA

The paper examines sustainability of budget deficits and dynamic linkages between government revenues and expenditures in five major South Asian economies, namely India, Pakistan, Bangladesh, Srilanka and Nepal for period 1985-2014. The study contributes to the literature by combining individual-country analysis with recent panel data approaches for robustness of results. Our results support existence of long-run relationship between government revenues and expenditures for the countries in a specification allowing for unknown structural break. The size of slope parameter obtained from Dynamic Ordinary Least Squares is however significantly less than one except for Bangladesh indicating incoherence with ‘strong’ sustainability of deficits. The long run causality analysis lends support to ‘spend-tax hypothesis’ for India, Bangladesh, Pakistan and Srilanka and ‘tax- spend hypothesis’ in case of Nepal. From perspective of design of fiscal consolidation programmes, this implies that adjustment of revenues would be optimal solution to control spending in Nepal while control of expenditure would be effective in case of India, Bangladesh, Pakistan and Srilanka. The results from Pedroni (1999) and Westerlund (2007) panel cointegration tests and block exogeniety and DumitrescuHurlin (2012) panel causality tests are broadly in conformity with the time series results.

81-98

Authors: Adel Shakeeb MOHSEN , Soo Y. CHUA , Che Normee CHE SAB

This study attempts to investigate the determinants of economic growth in Syria from 1980 to 2010. Results from the Johansen cointegration test indicate that public sector investment, private sector investment, exports, oil price, and population growth have positive long-run relationships with economic growth. Public sector investment has the biggest effect on economic growth. The Granger causality test results indicate bidirectional causality relationships between public sector investment, private sector investment, oil price, population growth and GDP in the short and long run. There are also bidirectional causality relationships between exports and GDP in the short run, and unidirectional causality relationship running from exports to GDP in the long run.

127-154

Authors: Gerti SHIJAKU

This paper analyses the inter-temporal competition – stability nexus after the global financial crises. For this reason, the empirical estimation approach follows a five – step procedure. First, we utilise quarterly macroeconomic and balance sheet and income statement data for 16 banks operating in the Albanian banking sector over the period 2008 – 2015. Second, we calculate a new composite index as a measure of bank stability conditions, which includes a wide set of information rather than focusing only on one aspect of risk. Then, we construct a proxy for bank competition such as the Boone indicator. Empirical estimations are based on the General Method of Moments approach. A set of robustness checks include also the use of other alternative proxy of competition such as the Lerner index and the efficientadjusted Lerner index, profit elasticity and the Herfindahl index. Empirical results strongly support the “competition – stability” view after the global financial crises - that higher degree of competition boosts further bank stability conditions. Results further indicate that greater concentration has also a negative impact on bank stability. Results imply also that bank stability is positively linked with macroeconomic conditions and capital ratio and inverse with operational efficiency. Finally, we do not find a non-linear relationship between competition and stability.

1-16.

Authors: M. Sait DINC, Vesna PLAKALOVIC

The main purpose of this paper is to examine the impact of caring climate, employees' job satisfaction, and affective commitment on employees' job performance in a banking sector. This study proposes that caring climate has a significant direct effect on overall job satisfaction, affective commitment, and job performance. Moreover, it suggests that caring climate has an influence on job performance through overall job satisfaction and affective commitment. Additionally, affective commitment is considered to be a mediator in the relationship between overall job satisfaction and job performance. In this study, the relationships among the variables were evaluated using factor analysis, descriptive statistics, correlations, and regression. The results based on a sample of 152 employees from one public and three private banks in the Federation of Bosnia and Herzegovina support the hypotheses. This study demonstrates that caring climate has a significant direct influence on overall job satisfaction, affective commitment, and job performance. Furthermore, caring climate has an indirect effect on job performance. Finally, this research discovers an indirect relationship between overall job satisfaction and employees’ job performance through a mediating role of affective commitment.

41-59

Authors: Jorma LEHTIMAKI , Jonne LEHTIMAK

Knowledge capital has become a major factor in a firm’s success. Depending on the owner knowledge capital can be divided into individual and organisational capital. The former is an individual’s knowledge which is comparable to liabilities in the balance sheet. The latter is connected to a firm’s structure and resources, and is comparable to equities in the balance sheet. Measuring knowledge capital is challenging, as it is often necessary to study private information from within a firm. This article approaches knowledge capital from a different perspective by studying public information in order to measure the financial value added by knowledge capital observed from a firm’s financial statement. This information was used to explain the financial performance of a firm. The results of the study indicate a statistically significant effect between the change in individual capital and economic performance as well as between organisational capital and economic performance. The immediate effect of individual capital on economic performance as well as the change in organisational capital was found to be statistically insignificant. The results imply that a firm looking for short-term growth should invest in organisational capital whereas a firm looking for long-term growth should invest in individual capital.

81-97

Authors: Kwasi BOAKYE-GYASI , Yao LI

Over the years, China has contributed immensely to the development process of Ghana through foreign direct investments; providing financial aids’ improved management training skills, and the transfer of innovation and technological techniques. This research examines the relationship between China’s foreign direct investment and Ghana’s building and construction sector performance. By using a robust regression model, the results show that China’s FDI in Ghana’s building and construction sector has significant positive effect on the economic growth of Ghana due to strong increase in investors’ confidence in the Ghanaian economy. Thus, FDI contributes to economic growth when there is an improvement of the infrastructure and operational skills of the local building and construction companies. This will lead to the increase of revenue for citizens who are employed in this sector and thus leading to the overall economic development of the country

113-134

Authors: Burcu OZCAN , Esma GULTEKIN

This study analyzes the validity of stochastic convergence hypothesis in relative per capita CO2 emissions in OECD (Organization for Economic Cooperation and Development) countries for the period 1960-2013. In other words, it is aimed to reveal the nature of shocks to relative per capita CO2 emissions. As such, divergence holds if shocks are permanent, whereas convergence holds if shocks are temporary. To that aim, the two-break LM (Lagrange multiplier) and three-step RALS-LM (residual augmented least squares Lagrange multiplier) unit root tests are employed. The results mostly provide evidence of convergence in case of two breaks. However, when structural breaks are not taken into consideration, divergence gains empirical validity. From the viewpoint of government policy, these results indicate that energy usage or environmental protection policies of OECD countries have not long-run impacts on the relative per capita emissions series of the sample countries. Concerning the break dates, the first breaks mostly cumulated around the two energy crises period, whereas the second breaks generally occurred in the 1990s.