Journal of International Economics and Management

1-18

Authors: Pham Thu Huong, Vo Xuan Vinh, Nguyen Thi Hien, Bui Thi Ly, Nguyen Ngoc Toan

Vietnam continuously liberalizes the financial market as a requirement for its accession to the World Trade Organization in 2007. This paper discusses the foreign investors’ expectation and their experience when penetrating into Vietnam’s market. The role of the foreign entrants is also assessed. By synthesizing and analyzing relevant research and reports, several important insights are discovered. Firstly, the presence of foreign investors and banks improves market competition, efficiency, and stability. Wholly and partly foreign-owned banks provide the spillover effects in management quality, in the introduction of world standard banking products and services, and in the application of information technology. Secondly, by looking into the foreign owned banks, it is found that the banks’ foreign investors are not likely to play an influential role in managing the banks they invested in. The motive of the investors to control the invested companies leads to their decision of holdings withdrawing.

46-61

Authors: Nguyen Binh Duong , Everett E. Mayers, Nguyen Duc Nhan, Dau Thu Huong, Hoang Thi Thuy Duong

The effects of climate change are being recognized in all regions of the world and they are predicted to increase in the coming decades. This paper aims to study the impacts of economic growth, energy use, and trade liberalization on CO2 emissions in Asia-Pacific countries. By using panel data to build an Environmental Kuznet Curve (EKC), the empirical result shows that the EKC of Asia-Pacific countries has N-shape. Besides, the energy use is one of the factors that worsen the environment. Finally, trade liberalization is an important factor that improves environmental quality in the region.

91-109

Authors: Nguyen Hong Quan, Nguyen Thi Anh Tho

The study examines the impact of six internal factors on the organizational commitment of the employees at the Bank for Investment and Development of Vietnam (BIDV). The reliability analysis and exploratory factor analysis were adopted to analyze the collected data from 292 surveyed samples. The results show that six elements including current job, working condition, leadership, colleagues, payments and salaries, promotion and development positively relate to employees’ organizational commitment at BIDV. Based on this finding, the most important implication is the need of establishing a holistic working environment.

1-24

Authors: Nguyen Tri Minh, Tran Ngoc Tho, Nguyen Huu Tuan

This paper attempts to bridge the gap in the literature on the effects of liquidity risks and macroprudential policies on the performance of domestic banks in Vietnam. The two-way fixed effects and fixed effects generalized least squares methods were employed to analyze panel data from 31 Vietnamese commercial banks from 2006 to 2020. The results show that the liquid assets to total assets ratio has a positive effect on bank performance, which is measured by net interest margin. Stricter macroprudential regulations, which are represented by the short-term funding for mid-to-long-term loans ratio, improve domestic banks’ performance when taking the increase of foreign bank presence into account.

42-55

Authors: Le Quang Minh, Nguyen Hoang Minh

This research aims at examining the moderation role of investment opportunities in the effect of state ownership on risk-taking behavior. The financial data of non-financial listed firms in Hanoi and Ho Chi Minh stock exchanges are collected from Bloomberg. The sample includes firm observations during the period from 2015 to 2020 with 2,664 firm-year observations. The paper finds that state ownership negatively affects corporate risk-taking behavior. Investment opportunities are found to moderate the negative impact of state ownership on corporate risktaking activities. The findings are robust by year-fixed effects along with clustered standard errors. Based on these findings, two policy recommendations are provided. First, state-owned firms should improve their corporate governance to deal with agency problems. Second, the government should consider policies to encourage state-owned firms to increase their risktaking behavior.

71-83

Authors: Hien Phuc Nguyen,Anh Ngoc Quang Huynh, Ulrike Reisach, Xuyen Le Thi Kim

Japan has provided ODA funding for promoting economic development in ASEAN countries for a long time. This study aims to verify how Japan’s ODA contributes to economic growth of the ASEAN countries during the period of 2008-2020. Based on the Cobb-Douglas production function, we build a model to estimate the effects of the ODA funding on economic growth. The results show that the ODA exhibits a significantly positive relationship with economic growth of these countries. A one percent increase in the ODA inflow contributes to the economic growth by 0.226 percent. Capital and labor are important factors driving the economic growth while FDI has a negligible impact.

1-22

Authors: Tang Van Nghia, Cao Thi Hong Vinh, Nguyen Duy Hung, Paul Schrader

Despite significant contributions of foreign direct investment to the economies of the host countries, the market-stealing effect on the domestic enterprises could appear as international capital ow rises. Market-stealing effect could be negative to the domestic firms, including the state-owned enterprises (SOEs). For Vietnam, both foreign invested firms and SOEs are of interest to the government. The question of whether the market-stealing effect on SOEs appears as foreign direct investment increases needs to be answered. This study provides insights into the market-stealing effect from the market share and labor productivity perspectives using the random effects models with the panel data of more than 4,000 observations of SOEs in Vietnam. The market-stealing effect on SOEs in Vietnam is not found in either market share or labor productivity perspective in this analysis. From the aspect of market share, this effect is revealed in two important industries, which are agriculture, forestry and fishing (Industry A) and manufacturing (Industry C). In addition, the market-stealing effect is higher for the SOEs with 100% of state capital. From the labor productivity perspective in this analysis, this effect does not exist.

42 - 62

Authors: Vinh Hoang Le, Anh Hoang Nguyen, Thuy Minh Thi Le, Vien Bich Cao

This paper aims to empirically examine the factors affecting the capital adequacy ratio by using the data collected from the audited financial statements of 24 joint-stock commercial banks in Vietnam over the period from 2009 to 2019 and the generalized least squares (GLS) estimation method. The results show that financial leverage, deposits from clients, loans to customers, liquidity, and profitability negatively affect the capital adequacy ratio. In addition, the paper also recognizes that the difference between the actual capital adequacy ratio and the prescribed minimum ones can be explained by the negative influence of bank size, financial leverage, loans to customers, liquidity, and profitability. The study provides empirical evidence and useful information for bank managers to make rational decisions in maintaining and adjusting their level of capital adequacy.

78 - 99

Authors: Nguyen Thu Giang, Duong Thi Hoai Nhung

The purpose of this paper is to identify and analyze factors that affect the career choices of fresh graduates majoring in business and economics. The proposed model of the study consists of four independent variables, which are family factors, personal interests, financial benefits, and peer influences. The results from the exploratory factors analysis and multiple regression analysis with data collected from 198 fresh graduates show that family factors have no relationship with career choices. Personal interests have the strongest influence on career choices, which are followed by financial benefits. Peer influences show a negative relationship with career choices. Based on these results, recommendations are proposed for fresh graduates, parents, academic institutions and educators, and businesses.

1-21

Authors: Tran Hue Chi, Phan Tran Trung Dzung

This paper investigates factors affecting cash holdings of materials firms listed on Vietnamese stock exchanges. The study shows that leverage, profitability, cash conversion cycle, cash flows, and growth opportunities significantly affect the level of cash holdings of Vietnamese materials companies by analyzing data collected from 51 companies over seven years (2013-2019) and using FGLS procedure on fixed effect estimation. This study adds more insights in the field of liquidity management in general and cash management in particular by determining factors influencing cash holdings. Outcomes from this research would help managers, investors, and consultants make corporate governance decisions.

47-72

Authors: Hien Thi Tran, Dat Quoc Nguyen, Hoan Dong Hoang

This paper explores factors of success/failure of new ventures in a startup hub city in an emerging country. The study uses the data from 27 personal interviews with local entrepreneurs in Hanoi, Vietnam. The business model, financial capital, human resources (i.e., human capital, social capital, psychological capital, cultural capital), technology, and the entrepreneurial orientation (i.e., innovative, problem-solving, risk-taking, and proactive) emerge as the factors of success/ failure of an entrepreneurial venture. Interestingly, technology is important but not as critical to the business model for the success of new ventures; and proactiveness but not autonomy is also a crucial success factor. The role of cultural capital is also an important input to the model. A conceptual model of success/failure factors of entrepreneurial ventures is developed from the findings, and the implications are discussed.

91-107

Authors: Tran Thi Kim Anh, Hoang Ha Anh

Digital transformation has been progressively attracting attention with its important influence on accounting and auditing in recent decades. This study aims at understanding the perception of digital transformation effect on audit quality to find out the digital challenges in auditing works at all stages. This study explores the perception of the effect of digital transformation on audit quality on four aspects, including audit users’ perception, regulations related to audit, auditors’ work, and auditors’ professional profile. A quantitative method is applied with data collected from a survey with 136 specialists in auditing. The results show a positive relationship between perception of digital transformation and audit quality. Recommendations from the findings are proposed for auditors, audit firms, and policymakers to adapt to the evolution of technology.

1-23

Authors: Huu Thang Nguyen

Do countries consume more electricity as they become richer? This study uses an instrumental variables approach to investigate the connection between electricity consumption and economic growth. With panel data of 32 countries spanning the period of 1996-2014, two potential instruments, which are an oil price shock as the main focus and past saving rates, are used for estimation. Controlling for country and time-fixed effects, the estimation results show no evidence of unidirectional causality runs from national income to electricity consumption.

47-65

Authors: Doan Duc Manh, Nguyen Dac Hieu

The study aims to identify and analyze the impact of the European Union - Vietnam Free Trade Agreement (EVFTA) on Vietnam’s exports of agricultural products. The secondary data from the World Bank and the SMART model under two scenarios are applied. The simulations suggest that the tariff elimination would result in a significant increase in Vietnam’s agricultural exports. The exported value of fish products from Vietnam shows the highest increase. In one scenario, as the European Union (EU) lowers the tariff to other competing countries, Vietnam’s exports of agricultural products exhibit minor reductions compared to the other scenario. Through examining the slight reduction and the revealed comparative advantage of Vietnam, it is found that crustaceans, mollusks, and other aquatic invertebrates are among the agricultural export products of Vietnam that potentially take the most advantage from the EVFTA.

91-108

Authors: Nguyen Thi Thanh Huyen, Suzuki Aya

Disease outbreaks are considered the root of drug overuse and the main reason for crop failure in the Mekong Delta. Shrimp cooperatives appear to be a promising solution to struggle with the problem because the cooperative model has been proven to be successful in many sectors such as agriculture, industry, and services. This study examines the effectiveness of a shrimp cooperative in terms of information sharing and price reduction. We employ the propensity score matching method (PSM) to do the analysis, based on the data collected from 256 households in nine communes in the Phu Tan district, Ca Mau province for 2016 and 2017. The study finds limited benefits for farmers who participate in shrimp cooperatives. It further explains why many farmers withdrew after a time. Although shrimp cooperatives have a significant effect on exchanging information related to prohibited substances, shrimp cooperative participants withhold shrimp prices. In addition, we find that the probability of participating in a shrimp cooperative is higher in households with older age or more educated household heads. Moreover, if the farmer has undergone training, the probability of participating in a shrimp cooperative increases.

128-148

Authors: Tran Thi Hien, Tran Thu Huong

This study explores corporate sustainability reporting in Vietnam, whether it is evolutionary or revolutionary. The study centers on answering the questions of the patterns of sustainability reports (SRs) and the level of conformity in the SRs of these companies to the Global Reporting Initiative (GRI) framework. Five big publicly listed companies in Vietnam have been selected for the case study. The content analysis method was applied for the data analysis. The findings indicate that four aspects are contributing to the evolution in sustainability reporting practices in those five companies. These include the nascent application of the GRI framework, the use of external assurance, the reporting models, and the incorporation of the United Nations Sustainable Development Goals into the reporting process.