Asset Pricing and Cost of Equity in the Tunisian Banking Sector: Panel Data Evidence

In spite of popularity and theoretical simplicity of the one-factor Capital Asset Pricing Model (CAPM) used in the valuation of financial assets, researchers are more concerned with the important extension proposed by Fama and French (1993) , that is, the Three-Factor Pricing Model (TFPM). Alongside beta, average stock returns could be explained by some size and book-to-market supplementary effects. With these two complementary models, estimation of the cost of equity is carried out for the Tunisian banking sector. In order to account for inter-individual heterogeneity, estimation of parameters is conducted according to random coefficient specifications within the context of panel data analysis.     

Does foreign direct investment increase exports’ productivity? Evidence from developing and emerging countries

Raising the productivity content of exports is an important issue for developing and emerging countries. What role do foreign firms play in this process? This question has not been adequately studied. We contribute to the literature by generalizing the role of foreign direct investment (FDI) in the host country’s export productivity level. Using panel data, we present new empirical evidence suggesting that FDI boosts the overall productivity level of the developing and emerging countries’ exports.     

Accounting practices,earnings volatility,and earnings forecast: The case of the oil and gas producing companies

International Advances in Economic Research -     

The effect of financial liberalization on banking sector stability

Several studies indicate that financial liberalization increases likelihood of a financial crisis without distinguishing between a normal period, unstable period preceding the onset of banking panics and crisis/post period. We explain in this paper the relationship between financial liberalization and banking sector vulnerability. Then, we argue that banking sector turmoil is most likely to occur after an intermediate degree of liberalization. Using a recently updated dataset for financial reforms, we find an inverted U-shaped relationship between liberalization and the likelihood of banking crisis for a sample of 49 countries between 1980 and 2010. We used a multinomial logit model in order to take into account what is called the ‘post crisis bias’. We ask whether the relationship remains when institutional characteristics of countries and dynamic effects of liberalization are considered. The empirical results indicate that the relationship between liberalization and banking sector stability depends strongly on the strength of capital regulation and supervision. With very weak regulation and supervision, the probability of banking crises is increasing with liberalization but this relationship is reversed as regulation and supervision become significant. The most important type of liberalization in relation to banking crises seems to be operational. A policy implication is that positive growth effects of liberalization can be achieved without increasing the risk of a banking fragility if appropriate institutions are developed.     

Extending Business Education Beyond Traditional Boundaries: A Case Study in Negotiated Problem Resolution in a Remote Regional Indigenous Community in Australia

It is widely accepted that the concepts and practices of management can only be of benefit when they are anchored to the contextual architecture of people, processes, structures, and technologies. The challenge of establishing a bridging program for providing managerial competencies to Australian Indigenous people has become a serious one for multinational mining companies. As the wings of globalization interact with the long-ignored reality of marginalized local milieu, a need for an innovative management education system has become a major imperative compelling multinational mining companies to work collaboratively with the government, educational institutions, and Indigenous communities. The article outlines a specific decision-making dilemma in an Indigenous context, while explaining the imperatives for educators, who have the challenging task of instructing potential graduates how to manage the unique contextuality of rural Australian Aboriginal communities. The article presents implications for large-scale modern multinationals as they move to geographically remote regions of the world where large number of marginalized local people need to be drawn into the workforce not only as an act of a social responsibility imperative, but also as sound business pragmatism.     

The effects of airline deregulation on shareholder wealth: Some additional evidence

This paper extends the prior research on the effects of deregulation on shareholders' wealth by measuring the market reaction to the events (i.e., information announcements) that led to the Airline Deregulation Act of 1978. The research design employs a model similar to that used by Beneish [1991]. This model conditions the return-generating function on the event (i.e., information) announcement and the market index. The empirical results reported in this paper indicate that the market favored airline deregulation. The favorable stock price reaction to airline deregulation could be explained in three ways. First, the market anticipated an increase in managerial efficiency and a reduction in managerial consumption of corporate resources in a competitive market structure. Second, the market did not impound the adverse consequences of deregulation as predicted by management because the market either did not perceive the manager's claim as a credible signal or the market was influenced more by the economic forecasts that predicted increased profitability under deregulation. Finally, there was evidence of increased industry profitability, increased productivity growth, and an expansion of the passenger base during the transition period (1976–78) when the Civil Aeronautics Board voluntarily began to relax regulatory controls. In this case, the paper concludes that the signing of the act merely made legitimate and extended the board's reform that began in 1975. That is, the signing of the deregulation act made these gains certain and permanent and this was received as a positive signal by the market.     

A shared boundary object: Financial innovation and engineering in Islamic financial institutions

This paper explores the way in which ethico-faith-based rules act as a boundary object in constraining the process of financial innovation and engineering (FIE) in Islamic Financial Institutions (IFIs). The paper examines how this faith-based approach is enacted in the FIE process amid different social worlds and groups that cooperate without consensus within IFIs. We contribute to studies of governance in faith-based organizations, by identifying the plasticity of faith-based rules that act as boundary objects in the governance of the FIE process. The plasticity of ethico-faith based rules allows coordination among local and global actors with intersecting faith-based values, logics, and interests. IFIs ensure that the products of FIE become an integral part of and as compatible as possible with the logics of global financial markets.     

Public preferences for landscape features: The case of agricultural landscape in mountainous Mediterranean areas

Provision of landscape amenities produced by farmers, in addition to their economic function of producing food and fibre, has contributed to a reassessment of the role of agriculture in society. In this paper, we examine whether agricultural landscape provision really responds to a social demand as is argued by those in favour of multifunctionality. Thus, the aim of the present work is two-fold. First, we evaluate rural landscape preferences of citizens from a range of choices in the mountain area of the Alpujarras (south-eastern Spain), and second, we estimate their willingness to pay (WTP) to enjoy each of the landscape characteristics existing in the area. For the empirical analysis, based on a survey of public preferences due to the good public characteristics of landscape amenities, we applied two stated preference methods: Conjoint Analysis (CA) and Contingent Valuation (CV). Three landscape attributes were considered for this analysis: type of vegetation layer, density of rural buildings, and level of slope. Several levels were also considered for each attribute: abandoned fields, dryland farming, irrigated farming, and natural lands were included for the vegetation layer; three levels (low, intermediate and intense) were considered for the level of slope and three levels (none, little and intense) for rural buildings.     

Export sophistication and the terms of trade of the developing and emerging countries

The question of the terms of trade has not yet been studied by the new empirical literature on the export sophistication, which focuses only on its effect on economic growth. The contribution of this paper is to investigate whether the increase in the export sophistication is terms of trade worsening or improving for the developing and emerging economies. Importantly, we find that the increase in the sophistication of the developing countries’ exports is accompanied by a deterioration of their terms of trade.     

Open interest,cross listing,and information shocks

This study examines the characteristics and behavior of the demand for hedging, proxied by open interest, for the cross‐listed Euribor futures contract traded at Euronext‐LIFFE and Eurex. The study is unique in its investigation of the simultaneous determinants of open interest in a cross‐listed setting. It also assesses the impact of shocks on traders' demand for hedging and shows how the 9/11 terrorist attacks and the credit crunch influence the level of dependency between Euronext‐LIFFE and Eurex. Differences of opinion, ECB Governing Council meetings, days of the week, contract maturity, illiquidity, and volatility are investigated as potential determinants of open interest. © 2010 Wiley Periodicals, Inc. Jrl Fut Mark 31:755–778, 2011