Showing papers in "VNU Journal of Science: Economics and Business in 2017"

The Determinants of Capital Adequacy Ratio: The Case of the Vietnamese Banking System in the Period 2011-2015

Abstract: The analysis of a data set of observations for Vietnamese banks in the period 2011-2015 shows how the Capital Adequacy Ratio (CAR) is influenced by selected factors, namely: asset of the bank SIZE, loans in total assets LOA, leverage LEV, net interest margin NIM, loans lost reserve LLR, Cash and Precious Metals in total assets LIQ. Results indicate, based on data, that NIM and LIQ have significant effect on CAR. On the other hand, SIZE and LEV do not appear to have significant effect on CAR. Variables NIM, LIQ have positive effect on CAR, while variables LLR and LOA are negatively related with CAR.

Institutional Quality Matter and Vietnamese Corporate Debt Maturity

Abstract: This article studies whether firm-level and country-level factors affect a corporation’s debt maturity in the case of Vietnam or not. The paper adopts the balance panel data of 267 listed companies on the two Vietnamese trading boards, HOSE and HNX, in the period from 2008 to 2015, estimated by the FEM, REM, 2SLS and GMM method. For intrinsic factors, research results show that financial leverage and default risk control have a high positive statistical significance with debt maturity, but tangible assets are lower than those factors. In addition, growth opportunities and company quality have negative impacts on debt maturity. For external factors, the results point out that economic growth, stock market development and governmental regulation efficiency demonstrate a positive relationship with debt maturity with fairly low correlation levels. In spite of that, the inflation rate, financial development, the rule of law, corruption control and the rights of creditor factors have negative correlations with debt maturity.

Factors Affecting Financial Literacy of Vietnamese Adults: A Case Study for Hanoi and Nghe An

Abstract: This research examines the factors affecting the financial literacy of Vietnamese adults. Using a sample of 266 observations of adults in two big cities in Vietnam (Hanoi and Vinh in Nghe An Province), the author evaluates the literacy level of adults in these urban areas. The financial literacy of the interviewed people is low. The multiple regression results show that lower financial literacy levels associate with higher age and married status and higher financial literacy levels associate with higher education, more family members, the person making financial decisions and the person attending a useful financial course. This research also explores the association between financial literacy and financial behaviors of individuals employing logistic models. It is found that higher financial literacy associates with less probability of overspending and higher probability of saving money and careful spending. Higher financial literacy is also found to associate with higher probability of opening a savings account and making various investments.

CEO Characteristics and Timeliness of Financial Reporting of Vietnamese Listed Companies

Abstract: Timeliness of financial reporting is a qualitative characteristics that enhance the usefulness of information and significant to users of financial statements. This study examines the impact that board diversity (GENDERCHAIR) and CEO age (CEOAGE) have on audit report timeliness. The sample of this study comprises of 100 companies listed on the Vietnamese Stock Exchange in the period 2012-2014. Ordinary Least Square (OLS) regression analysis is performed to test the audit report timeliness determinants. Using quantitative research methods, the study found that there is a significant positive relationship between board diversity on timeliness of financial reporting while proxy variables of the CEO age have a significant negative relationship with timeliness of financial reporting. This paper extends prior research by addressing the potential effects of female executives on timeliness of financial reporting. The findings reported in this paper provide novel insights for the empirical financial accounting literature.

Local Economic Governance and the Development of the Business Sector in Vietnam

Abstract: Local economic governance plays an important role in the development of the business sector. To assess its impact on business sector growth in Vietnam, this empirical study is conducted at the local level with all 63 provinces nationwide in the period from 2006 to 2014. The Provincial Competitiveness Index (PCI) is used as a measurement for local economic governance. The finding reveals that overall the PCI has a positive effect on growth in the number of enterprises and output generated in the business sector. At the sub-index level, 5 indicators show positive effects with labor training having the largest impact, followed by time costs of regulatory compliance, informal charges, transparency and finally business support service. Land access and security of tenure and proactivity of the provincial leadership unexpectedly show negative effects while the other 2 indicators, including entry cost for new firms and legal institutions, have no significant impact on business sector growth. Keywords Local economic governance, Provincial Competitiveness Index, business sector growth References [1] GSO Vietnam, Vietnam statistical yearbooks.[2] Abel, C., The Effect of Macroeconomic Variables on Profitability of Small and Micro Enterprises Industry in Nairobi County, 2014. [3] Irungu, S. and W.Muturi, “Impact of Macroeconomic Variables on Performance of Firms Quoted in the Energy and Allied Sector in the Nairobi Securities Exchange”, International Journal of Education and Research 3 (2015) 10.[4] Gertler, M. and S. Gilchrist, “Monetary Policy, Business Cycles, and the Behavior of Small Manufacturing Firms”, The Quarterly Journal of Economics 109 (1994) 2, 309-340.[5] Greenwood, R., “Evidence for a Debt Financing Channel in Corporate Investment”, Unpublished working paper, Harvard Business School, Harvard, MA, 2003.[6] Bernard, B., Sare, Y. and A.Musah, “The Effects of Interest Rate on Micro, Small and Medium Enterprises Financing Decision in Wa Municipality of Ghana”, International Journal of Business, Humanities and Technology 4 (2014) 4, 81-90.[7] Osoro, C. and W.Ogeto, “Macroeconomic Fluctuations Effects on the Financial Performance of Listed Manufacturing Firms in Kenya”, International Journal of Social Sciences 12 (2014), 34-87.[8] Grambovas, C. and S. McLeay, “Corporate Value, Corporate Earnings and Exchange Rates: An Analysis of the Eurozone”, The Irish Accounting Review 13 (2006), 65-83.[9] UNDP, A Users’ Guide to Measuring Local Governance, 2009.[10] Bissinger, J., “Local Economic Governance in Myanmar”, The Asia Foundation, No. 21 (2016).[11] Local Economic Governance: A Survey of Business Operators in 245 Districts /Municipalities in Indonesia, 2011.[12] Dixit, A., “On Modes of Economic Governance”, CESifo Working Paper Series No. 589, 2001.[13] Wal, F. and T. Hilhorst, “The Role of Local Government in Stimulating Pro-poor Economic Development: What and How?”, retrieved on, 26 September 2007, p.2012.[14] Provincial Competitiveness Index (PCI) reports.[15] Hoechle, D., “Robust standard errors for panel regressions with cross-sectional dependence”, Stata Journal, 7 (2007) 3, 281.

Causal linkage among tax revenue, provincial competitiveness and economic growth at provincial level: Evidence from Vietnam

Abstract: To investigate the role of governance and economic growth at the provincial level, this study conducted the Granger causality test for a panel data of 60 provinces in Vietnam from 2006 to 2014 and found that there is an existence of bi-directional causality linkage between provincial competitiveness (hereafter we call “governance”) and economic growth. Furthermore, running a two-step system generalized method of moments estimation (SGMM), this work shows the general provincial competitiveness index and tax revenue have a significantly positive impact on economic growth at a 1% level in three models. Notably, the effects of components of tax revenue and sub-provincial competitiveness on growth are diverse. In addition, student rate, and poverty rate relate negatively to economic growth. These findings imply that policymakers should focus on the increasing provincial competitiveness index as well as setting up an effective tax collection system for rising growth. Moreover, local governors are better providing variety of career options to reduce both ratios of student and poverty for sustainable developing economies in their areas.

The Effect of Top Executive Gender on Accrual Earnings Management: Sample Analysis of Vietnam Listed Firms

Abstract: The intent of this study is to investigate the top executive gender effect on earnings management of companies listed on the stock market. Based on data from 100 companies listed on the Vietnamese stock markets (HNX and HOSE) listed before 2009 in the period from 2011 to 2014, using quantitative research methods, we find a correlation between earnings management and top executive gender (GENDERCHAIR, GENDERCEO, GENDERCFO), the proxy of firm size and the tenure of the CEO. This paper extends prior research by addressing the potential effects of female executives on earnings management. The findings reported in this paper provide novel insights to the empirical financial accounting literature.

Celebrity Endorsement as Drivers of Advertising Strategy: The Case of Toc Tien Endorsing Oppo

Abstract: This study focuses on consumer perceptions of celebrity endorsement in Vietnam using the case of Toc Tien endorsing OPPO brand. Specifically, the research examines the impact of celebrity endorsement on viewers’ preference for advertising and purchase intention by using the structural equation method with a sample size of 304 respondents. We found some interesting results: attractiveness, expertise, familiarity, performance, likeability, and celebrity/product fit have a statistically significant positive relationship with advertising. Moreover, there was no evidence to show any linkage between trustworthiness and advertising. Findings indicate that viewers’ preference for advertising has a positive impact on purchase intention. Implications for marketers as well as suggestions for future research are also discussed.

Impacts of educational factors to entrepreneurship intention in university students

Abstract: Drawing on the theory of planned behavior in entrepreneurship, the research proposes a model linking educational determinants, perceived entrepreneurial behavior control and entrepreneurial intentions. The model was tested with a sample of 163 students at the National Economics University. The result shows that university education factors including “entrepreneurship inspiration”, “work integrated learning” and “extra curricular activities” have impact on “students‟ entrepreneurial behavior control” and then “entrepreneurial behavior control” as a platform through which the educational factors have impact on “overall entrepreneurial intention”. The findings provide support to Ajzen‟s theory of planned behavior and have wider implications for the practice of teaching in higher educational institutions.

The Researching the relationship between operational efficiency with profitability of telecommunication technology joint-stock companies.

Abstract: Operational efficiency (OE) and profitability are always the first priorities of any enterprise. Therefore, studying the relationship between OE and profitability needs to be taken comprehensively and continuously in order to find out solutions of business effectiveness increase. This paper focuses on the relationship between OE and profitability of the telecommunication technology (TT) joint-stock companies (JSCs) listed on the Ho Chi Minh Stock Exchange (HOSE) with answers for the above-mentioned issues. Keywords JSCs, operational efficiency, profitability, telecommunication technology References [1] Beal V. (without published year), Operational Efficiency, cited 30/07/2016 from http://www.webopedia.com/TERM/O/operational_efficiency.html>. [2] Burrows M. (without published year), Operational Efficiency - It’s not just about Cost Cutting, cited 30/07/2016 from http://www.bsmreview.com/oppseff.shtml>.[3] Hartman D. (without published year), How to Calculate the Maximization of Operational Efficiency, cited 30/07/2016 from http://smallbusiness.chron.com/calculate-maximization-operational-efficiency-35448.html>. [4] Kokemuller N. (without published year), What Is the Meaning of Operational Efficiency?, cited 30/07/2016 from http://smallbusiness.chron.com/meaning-operational-efficiency-67982.html>.[5] Kokemuller N. (without published year), Operational Effectiveness Vs. Strategic Positioning, cited 30/07/2016 from http://www.ehow.com/info_8447934_operational-effectiveness-vs-strategic-positioning.html>.[6] Varadan S. (without published year). What Is the Meaning of Operational Efficiency?, cited 30/07/2016 from http://www.ehow.com/about_6495198_meaning-operational-efficiency_.html>.[7] ‘Operational Efficiency’ (2016), Wikipedia, cited 30/07/2016 from https://en.wikipedia.org/wiki/Operational_efficiency. [8] Nguyen Van Cong (2009), Business Operation Analysis Textbook, National Economics Publisher, Hanoi (Nguyễn Văn Cong, 2009, Giao trinh Phân tich hoạt động kinh doanh, Trường Đại học Kinh tế Quốc dân, Ha Nội). [9] Gibson C. H. (2001), Financial Reporting Analysis: Using Financial Accounting Information, 8th ed., South-Western College Publishing, Thomson Learning.[10] Harward & Upto, (1961), Introduction to Business Finance, Mc Graw Hill, New York.[11] Patel S. B. P (2015), ‘Effects of Accounting Information System on Organizational Profitability’, International Journal of Research and Analytical Reviews, vol.2, iss. 1, pp.72-77.[12] Hofstrand D. (without published year). Understanding Profitability, cited 30/07/2016 from https://www.extension.iastate.edu/agdm/wholefarm/html/c3-24.html>.[13] Dang Ngoc Duc and Tran Tho Dat (2016), Monetary policy in period of 2011-2015 and its impacts on the economy, cited 30/07/2016 from http://kinhtevadubao.vn/chi-tiet/101-5229-chinh-sach-tien-te-giai-doan-2011-2015-va-nhung-tac-dong-toi-nen-kinh-te.html>. (Đặng Ngọc Đức va Trần Thọ Đạt, 2016, Chinh sach tiền tệ trong giai đoạn 2011 – 2015 va va tac động của no đến nền kinh tế).

Policy Implications to Improve the Business Environment to Encourage Female Entrepreneurship in the North of Vietnam

Abstract: Nowadays, Vietnamese women are participating actively in parts of the economy that were previously deemed male domain. Women are involved in business activities at all levels in Vietnam, making significant contributions to the economic development of the country. By December 2011, there were 81,226 small and medium enterprises headed by women, accounting for 25% of the total number of enterprises in the country (GSO, 2013). In Vietnam, despite recent economic development, socio-cultural and legal barriers are still very difficult for women since the general perception in society is that a woman’s main duty is to be a good housewife and mother and they are also often perceived as weak, passive and irrational (VWEC, 2007). Even though the studies related to women entrepreneurship development are quite extensive, amongst them only a limited number of researches on the role of legal and socio cultural barriers on women entrepreneurs in the context of Vietnam have been investigated. Thus, supported by the World Trade Institute (WTI) in Bern, Switzerland, the researchers have chosen this as the subject of this study. Based on a quantitative survey of 110 companies in Hanoi and adjacent areas, the research has taken legal and socio cultural barriers and explored their effect on the development of women entrepreneurship in the context of Vietnam in order to indicate how women entrepreneurs perceive the impact of socio-cultural factors, economic impacts, and policy reforms on their entrepreneurial situations and initiatives, and to then provide policy implications for promoting women’s entrepreneurship and gender equality in Vietnam.

An application of the SMART model to assess impacts of the EVFTA on Vietnam's imports of automobiles from the EU

Abstract: This paper assesses the potential impacts of the European - Vietnam Free Trade Agreement (EVFTA) on Vietnam's imports of automobiles from the EU by adopting the Software on Market Analysis and Restrictions on Trade (SMART) based on two scenarios. The simulation results reveal that the EVFTA would result in a significant increase in Vietnam's automobile imports from the EU, implying that the EU would be still among the biggest car sources for Vietnam in the upcoming time. However, when Vietnam also extends its coverage of tariff elimination to ASEAN+3, the reduction in Vietnam’s automobile imports from the EU would be considerable. Another important finding is that an uneven distribution in Vietnam’s additional automobile imports from the EU by nation, automobile group and automobile product would occur when the EVFTA comes into effect. In both scenarios, trade creation effects are higher than trade diversion effects and hence, the EVFTA could raise the welfare of Vietnam. Based on these results, the paper ends by drawing out some implications for the Vietnamese government and domestic enterprises to be better prepared for the upcoming ambitious EVFTA. Keywords Vietnam, EU, EVFTA, ASEAN+3, automobiles, SMART References [1] Quoc Hung, “In 2015, the automobile sales hit record”, Saigon Economics Online, 11/11/2016, http://www.thesaigontimes.vn/140962/Nam-2015-luong-o-to-tieu-thu-tang-ky-luc.html[2] Duc Huy, “The Vietnamese consumers bought cars at a record rate in 2016”, VnExpress, 12/1/2017, http://vnexpress.net/tin-tuc/oto-xe-may/nguoi-viet-mua-oto-nhieu-ky-luc-trong-2016-3526923.html[3] Vu Thanh Huong, “Assessing potential impacts of the EVFTA on Vietnam’s pharmaceutical imports from the EU: An application of SMART analysis”, SpringerPlus, 5 (2016a), 1-22.[4] Vu Thanh Huong, Assessing the possibility to bring about economic benefits of the European – Vietnam Free Trade Agreement, Hanoi, Vietnam:Vietnam National Univeristy, 2016b.[5] Tu Thuy Anh, Le Minh Ngoc, “Challenges for Vietnam in integrating comprehensively into ASEAN+3: A sector analyis”, Journal of Economics and Development, 212 (February 2015).[6] Karingi, S., Lang, R., Oulmane, N., Perez, R., Jallab, M. S., & Hammouda, H. B., “Economics and Welfare impacts of the EU-Africa Economic Partnership Agreements”, African Trade Policy Center, 10 (2005), 1-102. [7] Karingi, S., Oulmane, N., & Lang, R., “Assessment of the impact of the Economic Partnership Agreement between the ECOWAS countries and the European Union”, African Trade Policy Center, 29 (2005). [8] Ahmed, Shasil, “India-ASEAN trade agreement: A sectoral analysis”, SSRN Working Paper 1698849 (2010). [9] Amjadi, Azita, Schuler, Philip, Kuwahara, Hiroaki, & Quadros, Susanne, WITS: User’s manual, Washington DC.: UNCTAD, UNSD, WTO, WB, 2011.[10] Cassing, James, Trewin, Ray, Vanzetti, David, Truong Dinh Tuyen, Nguyen Anh Duong, Le Quang Lan, & Le Trieu Dzung, Impact assessment of Free Trade Agreement on Vietnam’s Economy, Hanoi, Vietnam: MUTRAP, 2010.[11] Baker, Paul, Vanzetti, David, & Pham, Lan Huong, Sustainable Impact Assessment: EU-Vietnam FTA, Hanoi, Vietnam: MUTRAP IV, 2014.[12] Veeramani, C., & Saini, G. D., Impact of ASEAN-India Preferential Trade Agreement on Plantation Commodities: A Simulation Analysis, Maharashira, India: Indira Gandhi Institute of Development Research, Mumbai, 2010.[13] Vanzetti, D., Pham, L. H., & Baker, P., “The European - Vietnam Free Trade Agreement: Sustainable Impact Assessment”, Paper presented at the conference Assessing the social, economic and environmental impacts of the European - Vietnam Free Trade Agreement, Hanoi, 2014.

Nonfarm Activities and Household Production Choices in Smallholder Agriculture in Vietnam

Abstract: This paper explores the effects of labour movement into nonfarm activities on household production choices in rural Vietnam. It finds that agricultural production declines and there are negative effects on farm revenue. However, these conclusions are limited in the North. Households in the North readjust their production structure by investing in livestock and other crops that require less labour. Rice farmers in the South have managed to keep their rice production unaffected by hiring more labour, and investing more capital to switch to less labourintensive farming. Evidence of relaxing liquidity constraints is found, at least in the short run. While the decline in agricultural revenue in the north suggests some level of substitution between farming and nonfarm activities, the stability in rice production at the national level brings good news to policy makers and for food security despite rapid structural change over the past decades.

How Free Trade Agreements Affect Exports and Imports in Vietnam

Abstract: The important year of 1995 marked Vietnam’s first integration as a member of ASEAN. By 2016, Vietnam had negotiated, signed, and implemented sixteen free trade agreements. They include both multilateral and bilateral free trade agreements such as the China-ASEAN, Vietnam-Chile, and Vietnam-Japan agreements. By signing free trade agreements Vietnam can increase trade flows in bilateral and multilateral developed-country FTA scenarios. Trade creation and diversion can be found in multilateral developing-country FTA scenarios and the author finds the impacts of each free trade agreement is different if analyzed for each 2-digit commodity. Keywords Free trade agreement, trade, import, export.t commodity References [1] Baier, S.L., Bergstrand, J.H., “Do free trade agreements actually increase members’ international trade?”, Journal of International Economics, 71 (2007), 72-95.[2] Chong, Soo Yuen & Hur, Jung, “Small Hubs, Large Spokes and Overlapping Free Trade Agreements”, The World Economy, 10.1111/j (2008), 1467-9701.[3] Hur, J., Alba, J. D., & Park, D., “Effects of hub-and-spoke free trade agreements on trade: A panel data analysis”, World Development, 38 (2010) 8, 1105-111.[4] McDonald, S. & Walmsley, Terrie, “Bilateral Free Trade Agreements and Customs Unions: The Impact of the EU Republic of South Africa Free Trade Agreement on Botswana”, The World Economy, 10.1111/j (2008),1467-9701.[5] Pan, S., Welch, M., Mohanty, S., Fadiga, M., & Ethridge, D., “Welfare analysis of the Dominican Republic-Central America-United States free trade agreement: The cotton textile and apparel industries”, The International Trade Journal, Vol. XXII (2008) 2, 1521-0545.[6] Benedictis, L., Santis, R., Vicarelli, C., “Hub-and-Spoke or else? Free trade agreements in the “enlarged” European Union”, The European Journal of Comparative Economics, 2 (2005) 2, 245-260.[7] Nguyen, Q.H., & Nguyen, T.H., “The impact of free trade agreement on trade flow of goods in Vietnam”, Vietnam Economist Annual Meeting, 2015[8] Das, R.U., Rishi, M., Dubey, J.D., “Asean plus six and successful FTAS: Can India propel intra-industry trade flows?”, The Journal of Developing Areas, 50 (2016) 2.[9] Hayakawa, K., “Impact of diagonal accumulation rule on FTA utilization: Evidence from bilateral and multilateral FTAs between Japan and Thailand”, J. Japanese Int. Economies, 32 (2014), 1-16.[10] Jennifer Y. Leung, “Bilateral vertical specialization between the U.S. and its trade partners - before and after the free trade agreements”, International Review of Economics and Finance, 45 (2016), 177-196.[11] Jongwanich, J., & Kohpaiboon, A., “Exporter responses to FTA tariff preferences: evidence from Thailand”, Asian Pacific Economic Literature (2017).[12] Lakatos, C., & Walmsley, T., “Investment creation and diversion effects of the ASEAN-China free trade agreement”, Economic Modelling, 29 (2012), 766-779.[13] Vanhnalat, B. at el., “Assessment the Effect of Free Trade Agreements on Exports of Lao PDR”, International Journal of Economics and Financial Issues, 5 (2015) 2, 365-376.[14] Vietnam Chamber of Commerce and Industry (VCCI), “Freedom of international trade in Vietnam”, Research report, Vietnam, 2015.

Recognizing Intellectual Capital in the Intangible Asset Structure of Enterprises in the Integration Period

Abstract: Value theory is one of the fundamental problems of economics which is applied in many different disciplines. However, the application of this economic theory in recognizing the valuation of intellectual capital of enterprises is a complex issue, especially knowledge is considered as an important form of resource and exchanged on the market. According to modern accounting theories, the accounting of intellectual capital is associated with the use of a measure of value to recognize, measure, and report on intangible assets of enterprises. However, current accounting practices do not meet the information demand of enterprise knowledge resources. This article focuses on clarifying the theoretical issues of knowledge resources in enterprises and the current state of accounting of intellectual resources in particular and intangible assets accounting in general in Vietnam in the integration period. Based on the research on content, requirements for managing knowledge resources and accounting methods, this article provides the guiding principles for the development of the accounting of intangible assets to exploit enterprises’ knowledge resources.