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1 – 10 of over 1000The measure sent bank stocks tumbling and ignited intense political debate, after which the government partially backtracked. The displays the ad-hoc nature of Meloni's economic…
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DOI: 10.1108/OXAN-DB281587
ISSN: 2633-304X
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Elena-Mădălina Vătămănescu, Juan-Gabriel Cegarra-Navarro, Aurora Martínez-Martínez, Violeta-Mihaela Dincă and Dan-Cristian Dabija
The study sets out to explore the mediating role of intellectual capital (IC) dimensions (i.e. human, structural and relational) between scholars' affiliation to online academic…
Abstract
Purpose
The study sets out to explore the mediating role of intellectual capital (IC) dimensions (i.e. human, structural and relational) between scholars' affiliation to online academic networks and institutional knowledge capitalization. Online academic networks are tackled through the lens of knowledge networks which have been of primary importance for new relevant knowledge acquisition during the COVID-19 pandemic.
Design/methodology/approach
A questionnaire-based survey of 305 academics from 35 different countries was conducted from July to December 2021, employing a partial least squares structural equation modelling technique. The database was initially filtered to ensure the adequacy of the sample, and data were analyzed using the statistics software package SmartPLS 3.0.
Findings
Evidence was brought forward that the proposed conceptual model accounted for 52.5% of the variance in institutional knowledge capitalization, the structural and relational capital availed by knowledge networks exerting strong positive influence on the dependent variable.
Research limitations/implications
The study has both research and managerial implications in that it approaches a topical phenomenon, namely the capitalization of online academic networks in the COVID-19 context, which has dramatically altered the way that research and teaching are conducted worldwide.
Originality/value
The most important contribution of the paper resides in the comprehensive research model advanced which covers individual, organizational and network multifaced layers, starting with the personal and institutional motives to join a specialized network, continuing with the opportunities provided by knowledge networks in terms of intellectual capital harnessing, and ending with its influence on higher education organizations.
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Elena Fedorova, Pavel Drogovoz, Anna Popova and Vladimir Shiboldenkov
The paper examines whether, along with the financial performance, the disclosure of research and development (R&D) expenses, patent portfolios, patent citations and innovation…
Abstract
Purpose
The paper examines whether, along with the financial performance, the disclosure of research and development (R&D) expenses, patent portfolios, patent citations and innovation activities affect the market capitalization of Russian companies.
Design/methodology/approach
The paper opted for a set of techniques including bag-of-words (BoW) to retrieve additional innovation-related data from companies' annual reports, self-organizing maps (SOM) to perform visual exploratory analysis and panel data regression (PDR) to conduct confirmatory analysis using data on 74 Russian publicly traded companies for the period 2013–2019.
Findings
The paper observes that the disclosure of nonfinancial data on R&D, patents and primarily product and marketing innovations positively affects the market capitalization of the largest Russian companies, which are mainly focused on energy, raw materials and utilities and are operating on international markets. The study suggests that these companies are financially well-resourced to innovate at risk and thus to provide positive signals to stakeholders and external agents.
Research limitations/implications
Our findings are important to management, investors, financial analysts, regulators and various agencies providing guidance on corporate governance and sustainability reporting. However, the authors acknowledge that the research results may lack generalizability due to the sample covering a single national context. Researchers are encouraged to test the proposed approach further on other countries' data by using the compiled lexicons.
Originality/value
The study aims to expand the domains of signaling theory and market valuation by providing new insights into the impact that companies' reporting on R&D, patents and innovation activities has on market capitalization. New nonfinancial factors that previous research does not investigate – innovation disclosure indicators (IDI) – are tested.
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Lin Han, Hansi Hu and Terry Walter
Are franking credit balances priced? This paper aims to investigate the valuation of franking credit balances via a determinant analysis and value relevance analysis.
Abstract
Purpose
Are franking credit balances priced? This paper aims to investigate the valuation of franking credit balances via a determinant analysis and value relevance analysis.
Design/methodology/approach
The determinant analysis examines the factors that contribute to the increasing cumulative level of franking credit balances. Value relevance studies explore whether franking credit balances are priced in the market.
Findings
The results provide strong evidence of a size effect that the level of franking credit balances increases with firm size and weak evidence of an international focus effect that the level of franking credit balances increases with international ownership. They also find an individual dividend clientele effect that the level of franking credit balances decreases with individual ownership. They find significant evidence that franking credit balances are priced in the market. One dollar of franking credit is worth 1.4 dollars in firm value. That franking balances are capitalized at more than their face value suggests that franking credits signal firms' future dividend policy. They also find that the market valuation of franking balances increases with firm size but decreases with international focus.
Originality/value
This study provides direct evidence that franking credit balances are capitalized into equity prices. In the determinant analysis, this paper improves Heaney's (2009) model by using the percentage of international ownership as the proxy of international focus, thus addressing the limitation of his measure. In the value relevance tests, the study uses a modified model that includes log-transformation to reduce the skewness of variables based on Tanza's (2014) value relevance model. Moreover, the study suggests that the market valuation of franking credit balances increases with firm size, which contradicts Heaney's (2009) findings.
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While poverty alleviation is the first core goal of Sustainable Development Goals (SDGs), and microfinance institutions (MFIs) are considered important instruments for poverty…
Abstract
Purpose
While poverty alleviation is the first core goal of Sustainable Development Goals (SDGs), and microfinance institutions (MFIs) are considered important instruments for poverty alleviation in developing countries as they provide credit access to the poor, there is surprisingly little evidence of the drivers of the lending behavior of microfinance institutions. Hence, the purpose of this study is to identify the factors that influence the credit growth of MFIs in Sub-Saharan Africa (SSA).
Design/methodology/approach
The study relies on unbalanced panel dataset of 130 MFIs operating across 31 countries in SSA during the period 2004–2014 constituting 546 useable observations. The study uses the Arellano-Bover/Blundell-Bond two-step generalized method of moments (GMM) Windmeijer bias-corrected standard errors to estimate the models.
Findings
The results confirm that while capitalization, liquidity and size are positively associated with credit growth, profitability negatively impacts credit growth; whereas, other MFI specific factors namely portfolio quality, deposit growth and nondeposit borrowing growth have little direct effects on MFI credit growth. The results also show that MFI credit growth is pro-cyclical but negatively related to GDP per capita consistent with the theory of convergence. On the other hand, inflation and employment are not important covariates in the credit growth of MFIs.
Practical implications
The findings suggest that if MFIs improve their liquidity and size by attracting more deposits and nondeposit borrowings, among others, they can increase credit access to the poor. Moreover, since the lending behavior of MFIs is not resilient to GDP shocks, different measures are needed to increase the financial stability of the microfinance industry. In this respect, since MFI capitalization is positively associated with credit growth and MFI credit growth is pro-cyclical, the findings provide useful insights to central banks/regulatory authorities and the Basel Committee as to the need for a counter-cyclical capital buffer requirement in the microfinance industry.
Originality/value
The study is the first comprehensive study to examine the drivers of MFI lending behavior as an extension to lending behavior models from the banking industry.
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Kenechi Peter Ifeanacho and Idu Robert Egbenta
The purpose of this research is to ascertain the extent to which the income capitalization approach reflects the pattern of emerging rental income in Enugu property market.
Abstract
Purpose
The purpose of this research is to ascertain the extent to which the income capitalization approach reflects the pattern of emerging rental income in Enugu property market.
Design/methodology/approach
The survey research design was used in this study. Data from the field was gathered through a data collection pro forma administered to 40 valuers in Enugu metropolis in the manner of conducting interviews. This study used key valuation details of 54 sampled income generating properties valued by the respondent valuers between 2015 and 2022 using the income capitalization approach. The same sampled properties were then revalued by the researchers using annuity due assumption/formulas of the income capitalization approach. Descriptive and inferential statistics were used to analyze the data.
Findings
The study revealed that the income capitalization approach used by most valuers in Enugu does not reflect the property rental income pattern prevailing in Enugu property market where rents are paid in advance. The study further shows that the application of the income capitalization approach for valuation of annually in-advance property rental income cash flow results in a higher capital value of 3.49% in Enugu property market.
Research limitations/implications
The limitations to this study are that past valuation done by valuers were used in the analysis instead of actual property sales and a relatively small number of sampled valuers and properties are used in the study The implication of the study is that ordinary annuity assumptions or formulas is inaccurate and not suitable for valuation of income generating property in an emerging market like Nigerian where timing of cash flow is annually in advance. Based on the result of this study it seems that ordinary annuity approach negate the principle of estimating value using income capitalization method by converting future cash flow from income generating property into an estimate of property value.
Practical implications
The study advocates the adoption of the use of annuity due formulas in the valuation of income generating properties in Nigeria as its practice standard to avoid undervaluation as this assumption is logical and provides more accurate value due to prevailing lease structure and rent payments patterns in the country. The implication of the study is that the use of ordinary annuity assumptions or formulas is inaccurate and not suitable for the valuation of income generating property in an emerging market like Nigerian where timing of cash flow is annually in advance.
Originality/value
This is one of the very few empirical studies carried out in Nigeria to ascertain the extent to which the income capitalization approach used by valuers reflects the rental income pattern that prevails in the Nigeria property market.
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This paper aims to address the question: What is the distribution of value (in pounds) created in a sample of domestic takeovers in the United Kingdom from 2013 to 2020 among…
Abstract
Purpose
This paper aims to address the question: What is the distribution of value (in pounds) created in a sample of domestic takeovers in the United Kingdom from 2013 to 2020 among acquirer and target stockholders?
Design/methodology/approach
The author employs a traditional event study methodology to calculate the percentage excess returns of companies on the announcement date. These returns are then converted into pound-denominated excess returns using the companies' market capitalizations. This allows the author to estimate the synergies of the mergers and acquisitions (M&As) and how they are allocated between acquirers and targets. This innovative transformation from percentage to pound excess returns establishes a new ratio methodology for addressing the paper's objective.
Findings
This paper reveals that in UK takeovers, 40 percent of the synergies in pounds are allocated to the stockholders of acquiring companies, while 60 percent go to the stockholders of target companies. In other words, acquirers retain a significant portion—more than half—of the synergies generated in these domestic deals. This original finding is statistically significant at the one percent level and strongly contradicts the hypothesis that acquirers, at best, merely break even.
Originality/value
The evidence that UK takeovers distribute value gains nearly equally between domestic deal parties challenges the enduring conventional insight in the M&A literature. This conventional wisdom suggests that the value created by business combinations is entirely distributed to target company stockholders. Consequently, this reexamination may have broader implications, offering an alternative perspective on the motives behind business combinations. This perspective differs from the “managerial hubris hypothesis,” which aligns with the prevailing conventional insight but receives limited support in the original finding reported here.
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Monsurat Ayojimi Salami, Harun Tanrivermiş and Yeşim Tanrivermiş
This study aims to examine the performance and volatility of Turkey Real Estate Investment Trusts (Turkish REITs) as the world is adjusting to the new normal situation in every…
Abstract
Purpose
This study aims to examine the performance and volatility of Turkey Real Estate Investment Trusts (Turkish REITs) as the world is adjusting to the new normal situation in every aspect of REITs' business activities.
Design/methodology/approach
The prices of REITs were acquired from 26 Turkish REITs in this study, but owing to autocorrelation difficulties, 14 Turkish REITs were employed in the analysis. The ten-year long-term bond of the Turkish Government was also utilized and the period of data obtained was based on availability. The performance of Turkish REITs was evaluated using Sharpe's ratio and Treynor's ratio, and the volatility was assessed using MGARCH-BEKK.
Findings
The authors found out that Turkish REITs are constantly underperforming and the REITs' returns remain highly volatile and persistent. In addition, findings showed evidence of volatility clustering and the asymmetric impact of shocks. This study further revealed the uniqueness of each of the Turkish REITs due to the lack of evidence of multicollinearity.
Research limitations/implications
However, the limitation of this study is the constraint in obtaining more macro-economic variables of more than ten-years of Turkey's Government bond and the study focused mainly on Turkish REITs.
Practical implications
The result suggests that since Turkish REITs are not mandatory to payout 90% of taxable earnings as dividends, high performance and an appropriate risk management approach are expected. The need for timely revealing performance of T-REITs and associated uncertainty may trigger better performance as discussed in the relationship between disclosure and performance which is recently emphasized in a recent study by Koelbl (2020). With current performance and associated uncertainty in Turkish REITs, the need to protect Turkish REITs investors is highly essential. The result further educates REIT investors that diversification benefits of REITs tend to reduce in extremely risky situations.
Originality/value
This is the first study in the context of Turkish REITs that comprehensively integrated market capitalization of REITs and simultaneous evaluation of performance and the volatility of the Turkish REITs as the world adjusts to the new normal.
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Aashi Rawal, Venkata Mrudula Bhimavarapu, Anureet Virk Sidhu and Shailesh Rastogi
Distressed companies create panic among investors. The overall effect comes on the economy and leads to a degraded image and value of all the companies operating in a country…
Abstract
Purpose
Distressed companies create panic among investors. The overall effect comes on the economy and leads to a degraded image and value of all the companies operating in a country. These distressing situations are harmful to the efficient development of a country in process of development. Financial distress (FD) is when a company or individual cannot promise to pay their obligations on time. Therefore, to analyze the threatening impacts of FD, the current study aims to reveal the impact of FD on the debt ratio (proxy of capital structure) of firms working in India.
Design/methodology/approach
Panel data analysis (PDA) has been used in the current study to analyze the data and generate novel results. The authors have considered the secondary data of firms present in the S&P BSE 100 index for ten financial years, i.e. 2010 to 2019.
Findings
This study has established that FD has no significant impact on the firm's capital structure. In addition, it has also been proved that asset size, learner's index, market capitalization and operating profit margin (OPM) have no interacting impact on the association between FD and the capital mix of firms.
Originality/value
As per the authors’ observation, no such study has been conducted till now that involves finding out the moderating impact of four different but significant factors of the business environment (assets size, learner's index, market capitalization and OPM) on the association between FD and capital structure of companies operating in a such an extensive and diverse economy.
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This study aims to examine the economic consequences of, and managerial behaviour in response to, the introduction of IFRS 16 Leases. It extends the debt covenant hypothesis to…
Abstract
Purpose
This study aims to examine the economic consequences of, and managerial behaviour in response to, the introduction of IFRS 16 Leases. It extends the debt covenant hypothesis to explain why firms reduce the use of operating leases with the introduction.
Design/methodology/approach
This study develops a model, based on operating leases as an alternative financing source and the determinants of debt policy, to estimate the effects of gearing on operating lease intensity. High gearing is a proxy to probably closer to the violation of, or expected to violate, the gearing restriction in debt covenants given the retrospective capitalisation of operating leases, when IFRS 16 takes effect.
Findings
This study finds that operating lease intensity fell between 2011 (immediately after the first exposure draft leading to IFRS 16) and 2018 (immediately prior to the effective date of IFRS 16). It also finds that gearing affects changes in operating lease intensity over 2011 and 2018, consistent with the debt covenant hypothesis.
Research limitations/implications
The introduction of IFRS 16 is a natural experiment with unique characteristics (the active lobbying behaviour, ex ante evidence on adverse economic consequences, a prolonged standard-setting period, etc.) valuable for accounting research.
Practical implications
A showcase about the relevance of financial reporting for contracting interests of firms and managers and a good reference for accounting standard setters in considering and managing the economic consequences of proposed accounting standards.
Originality/value
This study adds to the limited research on the consequences of accounting standards and documents the ex-post impact on firm leverage ratios and the behavioural aspects of reporting entities.
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