Journal of Economics and Behavioral Studies

1-22

Authors: Kafigi Jeje

SMEs are the major drivers of socioeconomic development of many economies. In order to influence economic growth, SMEs must be capable of enhancing their competiveness, growth, and sustainability. These capabilities are acquired by SMEs that understand and adopt entrepreneurial strategies that work. There is abundant literature confirming that one of these entrepreneurial strategies include risk-taking practices. SMEs are still facing challenges to understand and apply the right risk-taking strategies that influence their performance. We therefore characterize risk-taking as risk planning, risk controlling, and strategic risk initiatives, and seek to establish their contribution on SME performance. This study draws lessons from the risk management practices of small and medium-sized bakeries in Tanzania where agriculture, a sector that directly relates with bakery business, is one of the leading sectors in driving economic growth. We adopt a multi-stage sampling technique and receive responses from 161 questionnaires, and 20 in depth interviews from bakery owners/managers throughout Tanzania. The principal component analysis, qualitative content analysis (manifest analysis), and the moderator analysis are used in analyzing these data. We ascertain that both the firm age, and the gender of the owner/manager moderate the relationship between risk-taking strategies and SME performance. We argue that SMEs have the responsibilities of improving their risk-taking practices and capabilities in order to drive their competitiveness. Additionally, SMEs need to employ their efforts and resources in supporting their risk management initiatives, and integrate them in their business operations, and policy development practices, and ultimately advance their sustainability.

32-52

Authors: Pabai Fofanah

The objective of this paper has been to investigate the impact of exchange rate volatility on trade in the context of exports, imports, and the trade balance in West Africa. Applying the pooled Ordinary Least Square, the fixed effects, and the random effect models, and obtaining robust estimates for export and trade balance models by employing xtgls, panels (correlated) Corr (ar1), and adopting xtscc, fe regression with Driscoll-Kraay standard error to estimate the import model. The empirical results show that the impact of exchange rate volatility on exports and imports is insignificant. However, the result of the trade balance model shows a positive and significant link between exchange rate volatility and the trade balance. Thus, suggesting that traders tend to engage more in export activities with an increase in exchange rate volatility. Also, the analysis suggests that depreciation of the real exchange rate will lead to a decrease in exports. Thereby, confirming the limited production capability and heavy reliance on imported goods and services. Hence, this study recommends diversification of production activities and adopting strategies aiming at reducing dependence on imported goods and services. The empirical result shows a positive association between an increase in domestic economic activities of trading partners and exports of the West African countries. This implies that West African countries must engage in trade with countries that have a high economic growth rate. The result also shows a positive link between inflation rate and imports. This suggests the implementation of effective monetary policies geared towards controlling inflation.

65-69

Authors: Oktavia Nurlianto, Khoirul Aswar

This research begins with the problem of the Indonesian Minister of Finance recognizing cities and districts in Indonesia have a low level of compliance regarding financial reports and the Supreme Audit Board (BPK) has published a report that highlights compliance issues in the local government of Indonesia based on the Summary of First Semester Examination Results in 2019 there is a problem of the level of compliance of local government related to the disclosure of financial statements in Indonesia. The purpose of this study was to determine the factors influencing the degree of mandatory disclosure to local governments in Java and Sumatra Islands. This study has three objectives namely to find out the number of local parliamentarians, local government budget spending, existence of an assistance and training program for disclosure financial statement. Therefore, this research contributes to provide an illustration for local governments in measuring financial statement disclosures.