High level of education builds up strong relationship between organizational culture and organization performance in Pakistan

Organizational culture is an important aspect to be considered by dynamic organizations in order to develop some competitive advantage to ensure enhanced organizational performance. This study aims to elaborate the dimensions of cultural construct in organizations of diversified sectors and their implications in Pakistan. Ten organizations were selected for the study. Four hundred and seventy eight questionnaires were received from these organizations. The questionnaires consisted of three parts, of these, the first part had nine elements that were related to organization and personal profile of the respondents, whereas the second part consisted of 60 elements of cultural construct, namely mission, adaptability, consistency, and involvement. In the third part, dependent variable appears as organization performance and was evaluated by asking eight questions. Results are revealed in two models: according to the first model, organization performance increases from negative 56% to positive 92% due to organizational culture with respect to education. And the second model is also significant at the 95% of confidence level (p < 0.05), and there is a positive relationship between independent and dependent variables. Organizational culture is an essential part of organizational success. Core organizational values typically emphasize special themes such as performance excellence, innovation, social responsibility, worker involvement, and quality of work life. Literacy rate in Pakistan is far below the literacy rate in developed countries. Educated employees play an important role in enhancing organizational performance, particularly in corporate setup. To measure affects of education on organizational performance through its construct involvement, consistency, adaptability, and mission have been endeavored in this study.     

The tourism-led growth hypothesis: empirical evidence from Turkey

In the economic growth literature, the contribution of tourism to economic development has attracted great attention due to its significant roles as a source of foreign exchange earnings, creation of employment opportunities and an important source of public revenues in many countries. In this paper, we aim to analyse the empirical relationship between economic growth and tourism by employing different econometric techniques. First, we employed the Bound test approach developed by Pesaran, Shin, and Smith (2001, Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics, 16(3), 289–326) in order to investigate the co-integration relationship between economic growth and tourism. Second, we used the Granger causality analysis for the 1998–2011 period and found evidence of a long-run uni-directional causality running from tourism to economic growth, but not vice versa. Our findings show that the Turkish case supports the tourism-led growth hypothesis (TLGH). Third, the autoregressive-distributed lag approach was employed in order to investigate the long-term and short-term static relationship between tourism and economic growth. The results show that tourism has a positive effect on gross domestic product and economic growth both in the long-term and short-term. Finally, the effect of tourism on economic growth was also investigated dynamically by employing the Kalman filter method. The findings of this method support the TLGH for Turkey.     

Financial Statement Comparability and Idiosyncratic Return Volatility

This study examines the association between financial statement comparability and idiosyncratic return volatility (IRV). A greater degree of comparability lowers information acquisition costs, reduces the uncertainties associated with performance evaluation, and increases the overall quantity and quality of information available to corporate outsiders, which, in turn, helps investors to understand and evaluate the cash flow and performance of firms more accurately. Therefore, we hypothesize a negative association between financial statement comparability and IRV. Using a large US sample from 1981 to 2013, we show that financial statement comparability is associated with lower level of IRV significantly. We also find this association to be more pronounced in a poor information environment. This study contributes to the emerging research that stresses the benefits of financial statement comparability.     

Policy impact assessment in developing countries using Social Accounting Matrices: The Kenya SAM 2014

This paper describes the structure and estimation of a Social Accounting Matrix (SAM) of Kenya for the year 2014. Among its specificities, this SAM includes a very high disaggregation of the agri‐food sector and accounts for the double role of households as producers and consumers. Accounting for these characteristics is crucial to provide robust socioeconomic analysis in the context of developing countries. Indeed, this type of database is valuable to perform ex‐ante evaluations of economic policies with various economic models and techniques. In this paper, we present an application with a linear multiplier analysis (backward linkages and value chain decomposition). The results show the capacity of the primary sector in Kenya to generate value added and employment, with this growth distributed more intensely in rural households whose main livelihood is semi‐subsistence agriculture.     

The income elasticity of mortgage loan demand

One explanation for the emergence of the housing market bubble and the subprime crisis is that increases in individuals’ income led to higher increases in the amount of mortgage loans demanded, especially for the middle class. This hypothesis translates to an increase in the income elasticity of mortgage loan demand before 2007. Using applicant‐level data, we test this hypothesis and find that the income elasticity of mortgage loan demand in fact declines in the years before 2007, especially for the mid‐ and lower‐middle income groups. Our finding implies that increases in house prices were not matched by increases in loan applicants’ income.     

Managerial effect or firm effect: Evidence from the private debt market

This paper provides evidence that the managerial effect is a key determinant of firms’ cost of capital, in the context of private debt contracting. Applying the novel empirical method developed by an earlier study to a large sample that tracks the job movement of top managers, we find that the managerial effect is a critical and significant factor that explains a large part of the variation in loan contract terms more accurately than firm fixed effects. Additional evidence shows that banks “follow” managers when they change jobs and offer loan contracts with preferential terms to their new firms.     

Market ambiguity and individual investor information demand

We examine whether ambiguity in the market leads to an increase in information demand by individual investors. Drawing on the asset-pricing model proposed by Mele and Sangiorgi (2015), which incorporates market ambiguity, we measure individual information demand using daily Google searches and measure market ambiguity using a metric based on the market trades of institutional investors. We find that individual investors increase their information demand during periods of greater market ambiguity. We also provide evidence that information demand from individual investors spikes around earnings announcement days primarily when market uncertainty is driven by net-selling activity. Overall, these results suggest that the disagreement among institutional investors either represents uncertainty or contributes to the uncertainty related to a stock, leading to increased demand for information from individual investors.     

Abnormal real operations,real earnings management,and subsequent crashes in stock prices

We study the impact of firms’ abnormal business operations on their future crash risk in stock prices. Computed based on real earnings management (REM) models, firms’ deviation in real operations (DROs) from industry norms is shown to be positively associated with their future crash risk. This association is incremental to that between discretionary accruals (DAs) and crash risk found by prior studies. Moreover, after Sarbanes–Oxley Act (SOX) of 2002, DRO’s predictive power for crash risk strengthens substantially, while DA’s predictive power essentially dissipates. These results are consistent with the prior finding that managers shift from accrual earnings management to REM after SOX. We further develop a suspect-firm approach to capture firms’ use of DRO for REM purposes. This analysis shows that REM-firms experience a significant increase in crash risk in the following year. These findings suggest that the impact of DRO on crash risk is at least partially through REM.     

Volatility Linkages Among Gold Futures in Emerging Markets

We aim to detect the cross-border volatility linkages among gold futures in emerging markets, which still remain an untapped area. China, India, Japan, Taiwan, Turkey, and U.S. futures markets are included in the sample. The volatility linkage analyses confirm the existence of volatility transmission among the majority of the sample countries’ gold futures. This article carries vital inferences and implications for policy makers and investors. The policy making is particularly important for China, which is a relatively isolated market. From investors’ perspective, the results indicate that the risk diversification and cross-market hedging opportunities in the emerging gold futures markets are quite limited.