Showing papers in "British Journal of Economics, Management and Trade in 2012"

Agricultural Credit Allocation and Constraint Analyses of Selected Maize Farmers in Ghana

Abstract: The study analyzes factors influencing agricultural credit allocation and constraint condition of maize farmers in the Upper-Manya Krobo District in the Eastern region of Ghana. The study uses primary data solicited from 130 maize farmers through the administration of a structured questionnaire. Using the paired sample t-test to test for significant differences between the amounts of credit demanded and the amount received by farmers, it is revealed that the amount of credit received was significantly lower than the amount of credit demanded by farmers. The Probit regression model was then used to estimate the parameters of the determinants of credit constraint condition of the farmers. The empirical results reveal that gender, household size of farmers, annual income of farmers and farm size have significant influence on credit constraint conditions of the farmers. The Tobit regression model was also used to estimate the parameters of the determinants of the rate of agricultural credit allocated to the farm sector. The empirical results of the Tobit regression model reveal that age, bank visits before credit acquisition and the amount (size) of credit received have significant influence on the rate of agricultural credit allocation to the farm sector. The study provides the following recommendations: it is imperative that bank officials visit farmers on their farms before granting them loans, and also farmers must be granted the required amounts of loan to enhance the rate of agricultural loan allocation to the farm sector to ensure increased productivity of crops grown for increased welfare and livelihood of these farmers and the citizens of the country as a whole. Research Article British Journal of Economics, Management & Trade, 2(4): 353-374, 2012 354

Financial Development and Economic Growth: Is Schumpeter Right?

Abstract: Aim: The aim of the study is to test the validity of Schumpeter’s prediction that finance promotes growth using annual time series data from South Africa. Study Design: Case Study Place and Duration of Study: South Africa. Time series data ranging from 1965 to 2010. Methodology: The study employs unit root testing, co-integration analysis, Fully Modified Ordinary Least Squares (FMOLS) regression, Two-Stage Least Squares (2SLS) regression, Error Correction Model and Pairwise Granger Causality test technique to analyze annual time series data from South Africa. Two measures of financial development are used: domestic credit as a share of GDP measuring the degree of financial intermediary services; and broad money supply as a share of GDP measuring the overall size of the financial intermediary sector. Control variables included in the model are inflation, size of government, openness of the South African economy, and a dummy variable accounting for financial reforms that began in South Africa in the 1980s. Results: Contrary to the prediction of Schumpeter that finance promotes growth, the empirical results suggest that financial development does not promote economic growth both in the short run and in the long run. The Pairwise Granger Causality test result supports the assertion that there is a unidirectional causality from financial development to economic growth in South Africa. Conclusion: The paper concludes that Schumpeter may not be right in theorizing that finance promotes economic growth. Case Study

Carbon Dioxide Emissions, Energy Consumption and Economic Growth in Saudi Arabia: A Multivariate Cointegration Analysis

Abstract: This paper applied the ARDL and VECM test techniques on economic growth, CO2 emissions, energy consumption and the employment ratio to establish the long run and short run relationships between these variables in Saudi Arabia. The results show that there are long run and short run relationships among the variables in the model. The estimated elasticity coefficients of CO2 emissions, energy consumption, and employment ratio have positive and significant impacts on GDP in the long run. The results for direction of causality indicate that neither carbon emissions per capita nor energy consumption per capita cause GDP per capita, but employment ratio causes GDP per capita in the short run. On the basis of our empirical findings, it can be concluded that energy conservation policies and controlling carbon dioxide emissions, are likely to have no adverse effect on economic growth in Saudi Arabia in the short run. However, the long run income elasticity of carbon emissions is greater than the short run income elasticity of carbon emissions, which implies that in the long run income leads to greater carbon dioxide emissions in the country.

Investment in Telecommunications Infrastructure and Economic Growth in Nigeria: A Multivariate Approach

Abstract: This paper attempts to investigate the impact of investment in telecommunications infrastructure on economic growth in Nigeria. A multivariate model of simultaneous equations was deployed. The paper also deploys three-stage least squares method to capture the transmission channels through which telecommunications infrastructure promotes growth. The finding shows that telecommunications infrastructural investment has a significant impact on output of the economy directly through its industrial output and indirectly through the output of other sectors such as agriculture, manufacturing, oil and other services. The results also show a bi-directional causal relationship between telecommunications infrastructure and economic growth. The paper recommends for more effective telecommunications infrastructure that will further impact economic growth in Nigeria.

The Link between Remittances and Economic Growth in Pakistan: A Boon to Economic Stability

Abstract: This paper adopted the autoregressive distributed lag (ARDL) test and the error correction model (ECM) techniques to establish the long-run and short -run relationship between worker remittances and economic growth in Pakistan during the period 1976-2010. The results demonstrate the existence of a positive and significant relationship between worker remittances and economic growth in the long-run and short-run in that country. Worker remittances act as an important source of foreign capital, while a significant component of BOP serves as a boon to the economy. The gross fixed capital formation has a positive and significant impact on economic growth in the short run. The negative role in the long run in the presence of such financial flows shows the inappropriateness of policy measures aimed at boosting real sectors of the economy. FDI has a positive and significant impact on economic growth in the short run and long run.

Determinants of Risk Status of Small Scale Farmers in Niger State, Nigeria

Abstract: Aims: To ascertain the risk status of farming households and whether the risk status is accentuated by some factors. The specific objective is to determine the relationship between their risk status and socio-economic characteristics and food security status in the study area. Study Design: Cross-sectional study. Place and Duration of Study: Department of Agricultural Economics and Extension Technology, Federal University of Technology, Minna, Nigeria, between March 2011 and February, 2012. Methodology: The population for the study comprised farming households in Niger State. In order to obtain the sample for the study, two Local Government Areas (Suleja and Bosso) where randomly selected from where five farming communities were randomly selected and then ten farm families were randomly selected to give a total of 50 household from each Local Government Areas and 100 respondents for the study. The primary data covering background information, scale of production and yield, agricultural input use and access to credit, household food security and risk status were collected with structured questionnaire. Data analysis included the description of the socio-economic characteristics of the respondents using descriptive statistics and multinomial logistic regression used to confirm the determinants of risk status of the respondents. Results: With an LRI of 0.3451, the estimates of the explanatory variables show that the set of significant explanatory variables and their sign vary across the groups. The model, through the explanatory variables included predicted correctly 46.17% of risk neutral respondents, only 0.31% of the risk seekers and 53.53% of risk-averse respondents. The overall prediction was 53.8%. In this particular study, sex, primary educational status, years of farming experience, marital status, household size, credit, membership of cooperative, land acquisition by inheritance and total investment capital are the factors found to have determined risk status at different levels of significance but with differing Research Article British Journal of Economics, Management & Trade, 2(2): 92-108, 2012 93 signs relative to the base outcome. Conclusion: The model specified correctly predicted the probability of the risk status and has highlighted that there are more than just the observed socio-economic variables that explain the risk attitude of farmers, hence risk attitudes could only be explained by individual social, economic, cultural and psychological factors and it may be important to estimate individual risk preferences or identify factors that affect the individual’s capacity to bear risk or consider their risk environment.

A Test of Weak Form Efficiency for the Botswana Stock Exchange (2004-2008)

Abstract: Aim: This study aims to evaluate the presence of weak form efficiency in the Botswana Stock Exchange (BSE) using a number of methods that specifically assess the Random Walk Model. Study Design: Multi-model econometric study. Place and Duration of Study: Botswana, Gaborone, between December 2011 and January 2012. Methodology: The study uses a number of tests to examine the randomness of the BSE stock prices. The testing methods used are the Augmented Dickey Fuller tests, autocorrelation test, Kolmogorov-Smirnov Test, Runs Test and the Phillips Perron unit root test. The methodology was adopted because it mixed both parametric and nonparametric tests. All the tests are investigated on weekly and monthly All Company Index (ACI) data for the period 2004 to 2008. Results: All the tests show that the BSE is inefficient at the weak-form and that there is need for a number of adjustments to improve its efficiency. Conclusion: The random Walk hypothesis is rejected implying that experienced investment analysts have an advantage of outperforming the market and hence make higher than expected profits through the use of historical data.

Antecedents and Consequences of Employee Turnover: Empirical Evidence from Pakistan

Abstract: Aims: This study examines the interrelationship among major antecedents of employee turnover such as HRM practices, organisational culture, attitudes of boss on employees’ intention to quit in Pakistani banking and IT sectors. Study Design: The study employs exploratory research design; in-depth interviews were applied for the data collection. Place: The study is conducted in the national and multinational companies in Pakistan. Methodology: Data collected through in-depth interviews from thirty top executives to junior managers from government, private and multinational organisations. The study employed ‘narrative analysis’ method to analyse the data. Narrative analysis looks at selfstory and individual experiences of interviewee regarding social phenomenon. This analytical technique helped authors to compare and categorize emerging themes to give meaning to words, context-situation, story and basic actions. Results: The results suggest that, overall picture of HRM and organisational culture in public sector organisation appears to be poor whereas private (local) organisations seem comparatively better improving. On the contrary, respondents in MNCs expressed high agreement on merit-based HRM, organisational culture and attitude of boss with higher self-esteem. Conclusion: This study revealed that there exists interrelationship among the factors stated above and also study concludes that taking care of human factor with mutual

Estimating the First Demographic Dividend in Senegal: The National Transfers Account Approach

Abstract: Aim : To estimate the first demographic dividend in Senegal and discuss the conditions to enjoy it. Study Design: Cross-sectional study. Place and Duration of Study: Dakar. Methodology: We implemented the national transfers account (NTA) system that allow estimating what each individual gets at each age of the lifecycle. The calculations are based on two mains surveys conducted in Senegal several years ago, namely the “Enquete de Suivi de la Pauvrete au Senegal” (ESPS-2005) and the “Enquete 1-2-3”. Results: We came with estimations of individual needs for consumption and labor income, first demographic dividend as a contribution in income growth and our calculations indicate that Senegal is in a period of enjoying its first demographic dividend. Conclusion: In order to take advantage from the population structural change due to demographic transition, Government has to implement structural reform aiming at improving worker’s productivity and creating more job opportunities.

Lottery Sales and Per-capita GDP: An Inverted U Relationship

Abstract: The main purpose of this study is to test the hypothesis that the relationship between percapita sales and per-capita GDP is given by an inverted U. The paper considers that lottery sales increase together with increases in GDP up to a point where a country has reached a level at which the GDP is high enough and lottery sales become an inferior good and as a result, start to decrease. The results confirm the hypothesis, in addition to yielding other interesting findings: countries with higher levels of education sell fewer lottery products; lottery sales increase together with increases in the male to female ratio.

The Causal Relationship between Private and Public Investment in Zimbabwe

Abstract: The study examines the relationship between private and public investment in Zimbabwe utilizing yearly time series data for the period 1970 to 2007. Emphasis is placed on the direction of causality and the effect of the two types of investment on each other. The paper constructs empirical models for both private and public investment, based on the flexible accelerator theory. Private investment is found to be cointegrated with public investment. A cointergration approach and VEC model are employed to assess the short run relationship existing between public and private investment. The relationship between private and public investment is found to be insignificant and the direction of causality found to be unidirectional. The results support the notion that private investment precedes public investment.

A Dynamics Intergenerational Indicator of Poverty in Senegal

Abstract: Aims: This study focuses on the construction of a multi-dimensional dynamic indicator of the persistence of poverty over time between different generations from the quantitative and qualitative survey Vulnerabilities and Chronic Poverty in Senegal carried out in 2008/2009. Place and Duration of the Study: Laboratoire de Recherche sur les Transformations Economiques et Sociales (LARTES), University Cheikh Anta Diop of Dakar (UCAD), Senegal, between 2008 and 2009. Methodology: Based on a national sample consists of 2,048 biographies the study was based on non-monetary family indicators of poverty to understand the complex reality of poverty dynamics by generation. Results: The results highlight a complex mechanism of poverty transmission and provide information on trends (chronic poverty, transient poverty, not poverty) of trajectories over the generations. These results suggest the establishment of policies targeted to specific age group of individuals to allow local management of the problem of poverty, which previously was not necessarily the case. Thus, progress must be made to deepen our understanding of the causes of poverty, and improve the effectiveness of policies to reduce it. JEL: D30, D33, D63, C22

An Analysis of Cameroonian SMEs Performance in Foreign Markets

Abstract: The goal we are pursuing in this work is to make understand and explain the performances of Cameroonian SMEs in foreign markets though considered by the literature as outmoded and traditionalist. To conduct our work, we have used the hypothetico-deductive method. Thus, from the existing literature, we came out with three (03) hypotheses that relate the performance of Cameroonian SMEs having overseas markets to three (03) variables that we assume determine that performance. For the empirical work, we collected data from forty-one (41) Cameroonian SMEs having overseas markets. These SMEs were chosen in a rational way from the lists of companies provided by GICAM , the SYNDUSTRICAM and the National Federation of Associations of Small and Medium Enterprises (FNAP). To test our hypotheses, we have used the Pearson correlation test (Hypotheses 1 and 3) and the Fisher-Student test (hypothesis 2). Prior to testing hypotheses, we used principal components analysis to summarize the items used to measure the same variable. The results obtained in this study indicate the level of performance of Cameroonian SMEs performance and their determinants. They also show that SMEs performance deterioration is a phenomenon deriving from their management practice. Therefore, if Cameroonian SMEs are maintained in foreign markets it is thanks to the fact that they have succeeded in adapting themselves to the business environment. The threat for their international survival has pushed them to undergo the transformation process. Moreover, these results showed that the performance of Cameroonian SMEs having overseas markets is influenced by their ownership / management, strategies and the environmental constraints they face. Research Article

Determinants of Poverty among Crop Farmers: A Case of Ogo-Oluwa Local Government, Oyo State

Abstract: This study analyzed the determinants of poverty among crop farmers in Ogo -Oluwa Local Government, Oyo State, Nigeria. Primary data were collected with the aid of well

Corporate Social Responsibility: An Outlook of Indian Financial Institutions

Abstract: Aims: The principal objective of this research is to discern the perceptions of Indian financial institutions towards corporate social responsibility and also attempts to be acquainted with the opinions of employees, customers and general public. Methodology: This paper reviewed the relevant literature on CSR and Indian financial institutions. The researchers designed four types of questionnaires and conduct in-depth personal interviews to collect the opinions of financial institutions, employees, customers and general public. The survey confined only to fifty financial institutions related to banking, insurance, mutual funds, and share-broking companies. The researchers used simple random and convenience sampling methods to gather the data from 100 employees, 200 customers and 200 general public. The collected data was analyzed with Microsoft Excel software and frequency distribution. This research is limited to the financial institutions only from the sectors of banking, insurance, mutual funds, sharebroking which are operating from the southern state of Andhra Pradesh in India. Results: The Indian financial institutions expressed almost hundred percent positive attitudes in implementing CSR towards all the stakeholders. Regarding CSR towards

The Effect of Banks' Liquidity on Grant Facilities

Abstract: Managing huge amounts of assets in large banks require regular and constant control, as the slightest weakness in one of such bank’s various fields of activity can affect its assets in the long term. On the other hand, the increasing and expanding private banks and competitions between public and private banks further denote the importance of appropriate credit allocations and swiftness in granting facilities prompted the researcher to investigate and analyze credit and facility system of BSI, as large public bank in Iran. For this purpose, this study evaluates the relationship between changes in liquidity (increase/decrease) and capability to grant facilities in BSI by OLS (Ordinary Least Squares) econometric model which utilizes the data from 1984 to 2007 time series and considers the factors affecting the allocation of facilities including liquidity, capital, assets and deposits. The findings demonstrate that the amount of BSI liquidity has positive and significant effect on the capability of this bank to grant facilities, meaning that increase in liquidity results in increase in capability to grant bank facilities.