Socio-demographics,political attitudes and informal sector employment: A cross-country analysis

In this paper, we empirically investigate the relationship between informal sector employment and micro-level socio-demographic characteristics, political acts and attitudes, and individual norms. Using self-reported individual micro-level data from the World Values Survey for seven developing countries (China, Ecuador, Egypt, Mexico, Peru, South Africa and Yemen), our cross-country regressions and principal component analysis reveal that socio-demographic characteristics of individuals are strong predictors of their informal sector employment. Our estimations further document that individual preferences for an economically strong, interventionist and egalitarian state and confidence in state and political institutions are positively and significantly correlated with informal sector employment, whereas variables associated with confidence in free market institutions and support for competition are negatively and significantly correlated with informal sector employment. We also show that individuals who participate either actively or inactively in peaceful and lawful political processes are significantly less likely to work in the informal sector. Finally, we document that individual norms, such as religiosity and tax morale, are negatively correlated with informal sector employment. Throughout our analysis, instead of having to rely on ad-hoc informality categorizations of third parties, we base our measurement of informal sector employment directly on the self-evaluation of individuals, who have the best information on the degree of their informality.     

Revisiting the finance–growth nexus: the Turkish case, 1980–2010

In Turkey, the empirical results on the link between financial development and economic growth are mixed. The existing studies do not take into account the fact that Turkey has experienced endemic political and economic instabilities over extended periods. This study aims to analyse the role of macroeconomic instability and public borrowing on the finance–growth nexus in Turkey by using time series econometric techniques over the 1980–2010 period. In doing so, we attempt to extend the existing literature by taking into account the role of macroeconomic instability as well as public borrowing. Our results reveal that there are additional – albeit indirect – channels between finance and growth via the effects of macro instability and public borrowing on financial development and economic growth. After taking into account the effects of overall instability and public borrowing, we found that growth–financial development relationship is bidirectional and permanent. In other words, in Turkish case, economic growth and financial development are jointly determined. Thus, our results shed some light on the ambiguity of the evidence on the link between financial development and economic growth for Turkey.     

A solution to log of dependent variables with negative observations

Journal of Productivity Analysis - Negative observations pose a problem in econometric models that apply log-transformation to the data. We propose a simple yet effective solution to this problem...     

Scale effects of R&D as reflected in earnings and returns

Using returns to scale as a conceptual foundation, we explore how R&D-related earnings performance and earnings variability depend upon firm size. We find that the positive association between the level of future earnings and R&D intensity increases with firm size, and that the positive association between the volatility of future earnings and R&D intensity decreases with firm size, consistent with R&D productivity increasing with scale. We also show that R&D scale is associated with lower market returns, consistent with the idea that R&D investment risk declines with scale.     

Conditional Dependence in Precious Metal Prices

This study investigates the time-series properties of gold and silver spot prices. Both precious metal price series are found to exhibit time dependence and pronounced generalized autoregressive conditional heteroscedastic (GARCH) effects. Splitting the data into similar economic subperiods provides superior explanation of these effects because of the observed long-run nonconstancy of the unconditional variance. Further, the power exponential distribution, as opposed to the Student-t, is found to portray accurately the thick-tailed conditional variance that remains after the GARCH effects are removed. These findings imply that constant variance pricing models are inappropriate for securities that are based on precious metal prices.     

The role of Malawian local government in community development

The promotion of basic elements of good governance including community involvement through a decentralised local governance system has been at the centre stage since the advent of the multiparty democracy in Malawi in the 1990s. This article examines the role of Malawian local government in community development and analyses the context of community involvement in local governance. The article is primarily based on documentary research, which includes journal and newspaper articles, and interviews with senior district assembly officials and local people. The major conclusions drawn are that, firstly, the decentralisation process tends to feature the district assembly very highly, with little clarity on how community-based institutions are integrated into the local government system. Secondly, the political, socio-economic and administrative factors prevailing at the local level need to be addressed pragmatically for efficient and effective community participation in development.     

Individualization and Marketization of Responsibility for Gender Equality: The Case of Female Managers in China

This article investigates the question of where the responsibility for promoting gender equality resides in the Chinese employment context. Utilizing Acker's (2006) inequality regimes framework, the study explores women's underrepresentation in management roles in China and explains the persistence of gender inequalities in managerial echelons of Chinese organizations. Based on 30 interviews with female managers, the findings demonstrate the marketization and individualization of gender equality in organizational activity. The existing gender inequality, and the lack of responsibility for tackling it, has been either legitimized by eluding to the commercial‐only focus of organizations or rendered invisible through a belief in individual choice as the determining factor of career progression for women. Gender inequality in management is also maintained through the compliance of female managers themselves with the presumed legitimacy of gender‐based differential access to managerial roles. References to culture and tradition, market forces, competitive pressures, and individual choices by female managers are often made in explaining the unequal career paths and outcomes for men and women in their organizations. Our findings contribute to the human resource management (HRM) literature by framing macrosocietal context as a dynamic and endogenous aspect of management of human resources in organizations and provide novel insights into the interplay between HRM and societal context. © 2016 Wiley Periodicals, Inc.     

Islamic Banks,Deposit Insurance Reform,and Market Discipline: Evidence from a Natural Framework

Although it has been intensively claimed that Islamic banks are subject to more market discipline, the empirical literature is surprisingly mute on this topic. To fill this gap and to verify the conjecture that Islamic bank depositors are indeed able to monitor and discipline their banks, we use Turkey as a test setting. The theory of market discipline predicts that when excessive risk taking occurs, depositors will ask higher returns on their deposits or withdraw their funds. We look at the effect of the deposit insurance reform in which the dual deposit insurance was revised and all banks were put under the same deposit insurance company in December 2005. This gives us a natural experiment in which the effect of the reform can be compared for the treatment group (i.e., Islamic banks) and control group (i.e., conventional banks). We find that the deposit insurance reform has increased the market discipline in the Turkish Islamic banking sector. This reform may have upset the sensitivities of the religiously inspired depositors, and perhaps more importantly it might have terminated the existing mutual supervision and support among Islamic banks.