Eurasian Journal of Business and Economics

19

Authors: Mostafa ALI

This study explores the dynamic relation between economic growth and stock market depth in the presence of three more macroeconomic indicators such as exchange rate, inflation and interest rate of Bangladesh. We use Johansen and Juselius (1990) test of co-integration and Vector Error Correction Model (VECM) to detect the possible short-run and long-run causal relation among the selected economic forces. The results of the study evidence that the lagged error-correct term of GDP (i.e., the proxy of economic growth) is found statistically significant in all three models. This manifest that GDP tends to converge to its long-run equilibrium path in response to changes in its regressors. But we find a complex network of causal linkage between the variables in the short-run. The findings of this study are of particular interest and importance to policymakers, financial managers, financial analysts and investors dealing with the Bangladesh economy and the Bangladesh stock market.

22

Authors: Shahid AHMED, Saba ISMAIL

This paper examines the effect of bilateral tariff reduction in the agriculture sector between India and China. The results are evaluated in terms of welfare, output, employment and the potential trade flows between India and China using the GTAPmodel. The present study suggests that partial tariff reduction on imports of agricultural commodities between India and China may be welfare-enhancing for both India and China while complete tariff reduction on imports of agricultural commodities may have welfare loss for India, though there will be substantial welfare gains for China. The study reveals that welfare gains for China are larger in comparison to India. The study suggests that a well calculated and strategically negotiated tariff reduction in the agriculture sector may create a win-win situation for both partners. The study further argues that China should offer preferential market access to India for mutually beneficial and welfare-enhancing engagements for both countries. Finally, the study concludes that there exists a narrow scope for 'WTO-Plus' approach for India-China agriculture trade relations. India should assess all pros and cons as it has revenue loss and impact on economically marginalised 'Farming Community'.

15

Authors: Rabson MAGWEVA, Mabutho SIBANDA

Understanding the volatility behaviour of specific sectors of the economy enables investors to formulate workable investment strategies, and policy-makers to formulate policies that dampen excess volatility. This study examined the volatility features of the infrastructure sector in emerging markets. The features assessed were the GARCH effects, volatility persistence, and leverage effects. EGARCH and GJRGARCH models of order one under normal and non-normal error distributions were employed to unpack the volatility behaviour of infrastructure returns in emerging markets. The results from both models under all distributions indicated the existence of GARCH effects, volatility clustering, volatility persistence, and leverage effects in the infrastructure sector in emerging nations. This implies that past conditional variance is significant in determining current conditional variance, thereby rendering forecasting a worthwhile task. The findings also suggest that investors interested in the infrastructure sector in emerging markets should incorporate leverage effects in their estimation of value-at-risk. Furthermore, they should focus on factors other than mean-variance portfolio optimization and consider leverage effects, excess kurtosis, and skewness when making investment decisions. Finally, investors in the infrastructure sector in emerging markets are encouraged to formulate hedging strategies as they are exposed to significant risk and uncertainty.

19

Authors: Samik SHOME, Sushma VERMA

The Indian aviation sector over the recent years has shown a significant growth prospects on various parameters like passenger traffic, freight traffic, aircraft movements and number of airports, among others. But ironically the financial performance of most of the air carrier individually is not at all impressive. Every five years one airline in India is being grounded, latest being Jet Airways which had to suspend its operations in April 2019 due to severe financial crunch. The primary aim of this paper is to assess the current financial health of different Indian airline companies. This study uses four different models i.e. Altman Modified Z” Score Model, Pilarski Model, Fuzzy Logic Model and Kroeze Model to test the existence of financial distress and simultaneously aims to assess the applicability of these models on the Indian aviation sector. The models have been applied on four airline companies. Models indicate the existence of severe financial distress in three out of four chosen airlines and also indicate their suitability to be applied to the sector. The study contributes to the existing literature on Indian aviation by attempting to indicate the suitability of studied models for indicating financial distress which can lead to potential bankruptcy.

21

Authors: Erhan ATAY, Serkan BAYRAKTAROGLU, Gulfem TANRIVERDI

The purpose of this paper is to investigate the relationships between work-life conflict (WLB) and organizational voice in the higher education sector. We surveyed a population of academicians and administrative staff of two private universities in Istanbul, Turkey. We found that there is a positive relationship between life-work conflict and work-life conflict. The work-life conflict also affects organizational voice negatively. Results reveal that when employees have conflict in their work and life affairs, they prefer to be silent rather than speak up openly about organizational policies. This paper explores the importance of the work-life conflict in regards to remaining silent as a means of creating productive workplaces. This study is an attempt to contribute to the arguments on the situation about how people can remain silent or speak up in the workplace when they are not able to achieve balance work and living domains. This paper investigates the relationship between work-life conflict and organizational voice as perceived by the employees from the higher education sector.