The Development of Inequality and Poverty in Indonesia, 1932–2008

We estimate inequality in Indonesia between 1932 and 2008. Inequality increased at the start of this period but declined sharply from the 1960s onwards. The increase was due to a shift from domestic to export agriculture over the period up to the Great Depression. During the 1930s, as the price of export crops declined, the income of rich farmers suffered a blow. Yet this was counterbalanced by an increasing gap between expenditures in the urban and rural sectors, causing an overall rise in inequality. As for the second half of the century, we find that the employment shift towards manufacturing and services—combined with an increase in labour productivity in agriculture—accounts for inequality’s decline, which was halted in the 1990s. These inequality trends affected poverty as well, but prior to the 1940s the negative impact of the rise in inequality was offset by an increase in per capita GDP. Between 1950 and 1980 a decline in inequality, combined with increased per capita GDP, rapidly raised a large portion of the population above the poverty line.     

Liquidity and equity returns in Borsa Istanbul

We investigate the relationship between expected returns and liquidity measures in Borsa Istanbul. To do so, we gather a wide range of illiquidity measures that can be applied to the market. Firm-level cross-sectional regressions indicate that there is a positive relationship between various illiquidity measures and one- to six-month ahead stock returns. Findings of the article are robust after using different sample periods and controlling for well-known priced factors, such as market beta, size, book-to-market ratio and momentum. The portfolio analysis reveals that stocks that are in the highest illiquidity quintile earn 7.2%–19.2% higher risk-adjusted annual returns than those in the lowest illiquidity quintile. The illiquidity premium is stronger for small stocks and stocks with higher return volatility and it increases (decreases) during periods of extremely low (high) market returns.     

All-pay war

We study a model of conflicts and wars in which the outcome is uncertain not because of luck on the battlefield as in standard models, but because countries lack information about their opponent. In this model expected resource levels and production and military technologies are common knowledge, but realized resource levels are private information. Each country decides how to allocate its resources to production and warfare. The country with the stronger military wins and receives aggregate production. In equilibrium both comparative and absolute advantages matter: a larger resource share is allocated to warfare by the country with a comparative advantage in warfare at relatively low realized resource levels, and by the country with an absolute disadvantage in warfare at relatively high realized resource levels. From an ex-ante perspective the country with a comparative advantage in warfare is more likely to win the war unless its military potential is much lower.     

Merits of Task Advice during New Product Development: Network Centrality Antecedents and New Product Outcomes of Knowledge Richness and Knowledge Quality

Utilizing new product development (NPD) teams to accomplish complex tasks in firms has been an emergent issue in many industries throughout the last couple of decades. Despite numerous studies, formation and efficient management of NPD teams is still a developing research domain. Using the knowledge‐based view of the firm and social network theories complementarily, this paper contributes to literature by examining the intrafirm social relational structures of NPD teams. Focusing specifically on the network centrality of the NPD teams, this paper argues that network centrality types of closeness, betweenness, and degree centralities influence the quality and richness characteristics of knowledge received through task advice seeking. Subsequently, the knowledge gained with these characteristics enhances product innovativeness and new product success. Consequently, the second contribution of this paper is to conceptualize the effect of the task advice‐seeking activities of NPD teams on NPD outcomes. The paper concludes with a discussion of the empirical testing of the proposed model, including suggestions for focal construct operationalizations as well as other future research directions.     

Perceptions and knowledge of accounting professionals on IFRS for SMEs: Evidence from Turkey

This exploratory study extends the literature on IFRS for SMEs issued by the IASB in July 2009, and adopted by Turkey in November 2010. A questionnaire survey, based on the relevant literature and IFRS for SMEs, was developed. The aim was to investigate basic knowledge and perceptions of accountants regarding IFRS for SMEs. Our findings suggest that proponents of stand-alone IFRS for SMEs outnumber its opponents. The respondents are not highly informed about the omission of certain topics in IFRS for SMEs. Their awareness of valuation methods/concepts in IFRS for SMEs is at a moderate level. Inadequacy of accounting personnel’s training and lack of training programs arranged by professional bodies are considered to be the most serious obstacles in implementation of the standards. The majority of the participants are not aware of the key differences between full IFRS and IFRS for SMEs and simplifications made in IFRS for SMEs. Accounting professionals who are trained about IFRS for SMEs and the employees of Big4 auditing firms are more knowledgeable about the standards in comparison to others. Education level and experience of respondents have partial positive impact on knowledge of the standards.     

Prediction of bank financial strength ratings: The case of Turkey

Bank financial strength ratings have gained widespread popularity especially after the recent financial turmoil. Rating agencies were criticized because of their ratings and failure to predict the bankruptcy of the banks. Based on this observation, we investigate whether the forecast of the rating of bank's financial strength using publicly available data is consistent with those of the credit rating agency. We use the data of Turkish banks for this investigation. We take a country-specific approach because previous studies found that proxies used for environmental factors (political, economic, and financial risk of the country) did not have any explanatory power and it is hard to find international data for other important factors such as franchise value, concentration, and efficiency. We use two popular multivariate statistical techniques (multiple discriminant analysis and ordered logistic regression) to estimate a suitable model and we compare their performances with those of two mostly used data mining techniques (Support Vector Machine and Artificial Neural Network). Our results suggest that our predictions are consistent with those of Moody's financial strength rating in general.. The important factors in rating are found to be profitability (measured by return on equity), efficient use of resources, and funding the businesses and the households instead of the government that shows efficient placement of the funds.     

Partnership Between Local Government and the Local Community In The Area of Social Policy

The article describes the background and history of one project aimed at developing a strategic social plan in the city of Eger. This initiative was based upon partnership between the municipal government, the local community and civil organizations in Eger. It offers an important perspective upon the potential, in the transitional nations of eastern and central Europe, for public-private partnership as an effective mechanism both to map social needs and to develop policies to address these needs. It also offers one particular approach to the development of such partnerships - the decision conferencing model. Such an approach takes public-private partnerships into an arena beyond that of policy implementation alone.     

The Significance of the New Venture's First Sale: The Impact of Founders' Capabilities and Proactive Sales Orientation

Initial sale success in the market with a new product is a critical milestone for a new venture. Failure at the introduction stage of a new product could have lethal consequences for the venture. In the present study, the authors investigate the role of a new venture company's first successful sale in the venture's future commercial success. The authors develop and test a model of the impact of the founders' entrepreneurial and commercial capabilities and proactive sales orientation on the significance of the first sale and sales growth of a new venture. Using survey data and partial least squares estimation, the results reveal that the founders' commercial capabilities have a positive effect on proactive sales orientation, while their entrepreneurial capabilities positively moderate the effect of commercial capabilities. Further, the results reveal that a proactive sales orientation positively affects the significance of the first sale and that value‐based selling approach positively moderates the effect of proactive sales orientation. Finally, the results reveal that the significance of the first sale is positively related to sales growth. Thus, the authors conclude that combining the founders' commercial and entrepreneurial capabilities strengthens proactive sales orientation and that, in turn, a proactive sales orientation particularly increases the significance of the first sale when new venture companies practice value‐based selling. Research has convincingly demonstrated proactive selling behavior to be one of the most powerful predictors of sales performance. Value‐based selling is a sales approach to identify, quantify, communicate, and verify value of a new product to the customer. Our findings suggest that founders who possess both strong commercial and entrepreneurial capabilities engage considerably more in proactive sales practice as compared with founders that only possess strong commercial capabilities. Hence, rather than hiring specific sales expertise, founders should develop their proactive, value‐selling capabilities.     

“Modeling the impact of wars and terrorism on tourism demand in Kurdistan region of Iraq”

Portuguese Economic Journal - Recent political instabilities in the Middle East have led to strong negative impacts on the tourism sector. The aim of this study is to investigate the extent and the...