University of Ljubljana, Faculty of Economics

About: University of Ljubljana, Faculty of Economics is a based out in . It is known for research contribution in the topics: Productivity & Tourism. The organization has 251 authors who have published 533 publications receiving 16109 citations.

Asymmetric Lévy Flight in Financial Ratios

Abstract: Because financial crises are characterized by dangerous rare events that occur more frequently than those predicted by models with finite variances, we investigate the underlying stochastic process generating these events. In the 1960s Mandelbrot [Mandelbrot B (1963) J Bus 36:394-419] and Fama [Fama EF (1965) J Bus 38:34-105] proposed a symmetric Levy probability distribution function (PDF) to describe the stochastic properties of commodity changes and price changes. We find that an asymmetric Levy PDF, Graphic, characterized by infinite variance, models several multiple credit ratios used in financial accounting to quantify a firm’s financial health, such as the Altman [Altman EI (1968) J Financ 23:589-609] Z score and the Zmijewski [Zmijewski ME (1984) J Accounting Res 22:59-82] score, and models changes of individual financial ratios, ΔXi. We thus find that Levy PDFs describe both the static and dynamics of credit ratings. We find that for the majority of ratios, ΔXi scales with the Levy parameter α ≈ 1, even though only a few of the individual ratios are characterized by a PDF with power-law tails Graphic with infinite variance. We also find that α exhibits a striking stability over time. A key element in estimating credit losses is the distribution of credit rating changes, the functional form of which is unknown for alphabetical ratings. For continuous credit ratings, the Altman Z score, we find that P(ΔZ) follows a Levy PDF with power-law exponent α ≈ 1, consistent with changes of individual financial ratios. Estimating the conditional P(ΔZ|Z) versus Z, we demonstrate how this continuous credit rating approach and its dynamics can be used to evaluate credit risk.

The Role of Asset Allocation Decisions in Planning for a Private Pension: The Case of Slovenia

Abstract: Current demographic dynamics driven by low fertility and increasing longevity requires adjustments of the traditional frameworks of providing pensions. In this article we highlight three crucial issues policymakers should address by implementing those adjustments. First, fiscal limitations given the current and projected demographic dynamics will dramatically reduce PAYG pensions. Without sufficient savings during the active period, individuals will increasingly end up in poverty. Their savings will not be enough to support their desired consumption in old age. Second, we highlight the impact of the asset allocation decision and the general public’s related lack of awareness on this issue. Therefore, we argue that financial illiteracy about both required savings and about decisions on appropriate asset class play a significant role in determining the well-being of masses in the not-so-distant future. Third, we argue that shift towards private pension away from the PAYG is expected to come with substantial benefits stemming from diversification among conceptually different sources of pension income.

Towards Business Intelligence Systems Success: Effects of Maturity and Culture on Analytical Decision Making

Abstract: The information systems (IS) literature has long emphasized the positive impact of information provided by business intelligence systems (BIS) on decision-making, particularly when organizations operate in highly competitive environments. Evaluating the effectiveness of BIS is vital to our understanding of the value and efficacy of management actions and investments. Yet, while IS success has been well-researched, our understanding of how BIS dimensions are interrelated and how they affect BIS use is limited. In response, we conduct a quantitative survey-based study to examine the relationships between maturity, information quality, analytical decision-making culture, and the use of information for decision-making as significant elements of the success of BIS. Statistical analysis of data collected from 181 medium and large organizations is combined with the use of descriptive statistics and structural equation modeling. Empirical results link BIS maturity to two segments of information quality, namely content and access quality. We therefore propose a model that contributes to understanding of the interrelationships between BIS success dimensions. Specifically, we find that BIS maturity has a stronger impact on information access quality. In addition, only information content quality is relevant for the use of information while the impact of the information access quality is non-significant. We find that an analytical decision-making culture necessarily improves the use of information but it may suppress the direct impact of the quality of the information content.

The role of alignment for the impact of business intelligence maturity on business process performance in Croatian and Slovenian companies

Abstract: Business intelligence (BI) allows companies to analyze business information in order to support successful decision making. Currently, the research on the level of BI maturity in Croatian and Slovenian companies is limited. In addition, several BI maturity models have been developed, but most of them are not comprehensive. In order to shed some light to this issue, this paper is focused on two goals: (1) to investigate the impact of BI maturity on business process performance and (2) to explore the requirements for the alignment of two concepts, BI and business process management (BPM) within the organization. Paper presents the following: (i) investigation of BI and BI systems in general, (ii) adaption of the BI maturity model (called biMM) for the purpose of this research, (iii) results of the primary research on the sample of Croatian and Slovenian companies which has been conducted as one of the activities of the project financed by the Croatian Science Foundation: IP-2014-09-3729 Process and Business Intelligence for Business Excellence, (iv) level of BI maturity and the role of BI and business process alignment for the impact of BI maturity on business process performance in investigated companies.