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1 – 10 of 11The purpose of this paper is to examine the degree of integration of emerging markets with the world market and amongst them. Further, the impact of the 2008 global financial…
Abstract
Purpose
The purpose of this paper is to examine the degree of integration of emerging markets with the world market and amongst them. Further, the impact of the 2008 global financial crisis (GFC) on and structural breaks in the degree of integration are explored. The paper, additionally, analyses the behaviour of the level and the rate of change of the degree of integration around the period of the GFC.
Design/methodology/approach
The paper relies on the R2 from a single factor world and the incremental R2 from a two-factor world and emerging market models as proxies for the global and emerging markets degree of integration, respectively. Relying on the Quandt test for unknown structural breakdates, the paper examines structural breaks in the degree of integration.
Findings
The degree of global integration of emerging markets exceeds their degree of integration with themselves, particularly in the recent period. Additionally, the GFC is a significant driver of the recent increase in world market integration. We observe significant structural shifts in both the degree of the world and emerging markets integration measures. The breaks in the world market integration largely coincide with the GFC, whereas that of the emerging market integration is dispersed. Also, the level of the world market degree of integration has reversed recently, although, the degree of world market integration remains above pre-crisis point.
Practical implications
There exist high country-specific components in emerging market returns that are not accounted for by the world and emerging market factors despite the recent increase in global integration. Thusly, portfolios that diversify across emerging markets appear to have a high diversification potential. Additionally, substantial diversification gains may be realised with the inclusion of emerging market assets in global portfolios.
Originality/value
The paper shows that the emerging markets respond similarly to common global, although, diversely to emerging markets events. Additionally, evidence of the impacts of the GFC on the degree of global integration of emerging markets is presented.
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The purpose of this paper is to explore the co-movements among emerging markets. The authors, additionally, investigate the driven force of the within emerging markets…
Abstract
Purpose
The purpose of this paper is to explore the co-movements among emerging markets. The authors, additionally, investigate the driven force of the within emerging markets integration. The authors provide evidence of volatility clustering, leverage effect and time-varying integration of emerging markets.
Design/methodology/approach
The study used dynamic conditional correlation techniques to estimate the time-varying conditional correlations among emerging markets. The cross-sectional and time series variations in the within emerging markets correlations are then described by various market and economic factors.
Findings
The authors show that investment, domestic credit to the private sector and import of financial services have a positive relation within emerging markets co-movements. However, claim on central government, current account balance and financial services exports have a negative relation with the integration among emerging markets. Evidence is also provided that liquidity and market depth explain the correlation between emerging markets.
Originality/value
The findings show that emerging markets ability to convert domestic assets into investments appears to be the single most important factor influencing with in emerging markets integration. The findings indicate that across-emerging markets diversification potential exists.
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Nicholas Addai Boamah, Francis Ofori-Yeboah and Nicholas Asare
This study investigates the ability of crime management expenses, recognised external quality certification and ownership structure to describe the cross-sectional changes in the…
Abstract
Purpose
This study investigates the ability of crime management expenses, recognised external quality certification and ownership structure to describe the cross-sectional changes in the capital and labour efficiencies of manufacturing firms in middle income economies. It controls for the potential effects of graft incidence and firm age on firm-level efficiency.
Design/methodology/approach
The study adopts a state space model approach within the context of cross-sectional regressions. Data for the study are obtained from the World Bank Enterprise Survey for 2006, 2009, 2013, 2016 and 2019.
Findings
The study provides evidence that crime management expenses impact labour efficiency negatively. Also, its effect on capital efficiency is positive in 2019 and negative in 2013 and 2016 eras. Additionally, external auditor services and internationally recognised quality certification increase labour and capital efficiencies. Graft incidence exerts negative and positive effect on capital efficiency in the recent and earlier periods respectively. In addition, older firms tend to have higher labour efficiency, whilst younger firms have higher capital efficiency. There is evidence of firm size and export orientation effects in the drivers of efficiency.
Originality/value
Policies aimed at creating graft and crime-free business environment will enhance the efficiency and growth of firms' particularly for small firms. Also, the market rewards recognised quality assurance and good reputation.
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Nicholas Addai Boamah, Francis Ofori-Yeboah and Kingsley Opoku Appiah
The study investigates the effect of political instability and employee tenure security on the performance of firms in middle-income economies (MIEs) after controlling for the…
Abstract
Purpose
The study investigates the effect of political instability and employee tenure security on the performance of firms in middle-income economies (MIEs) after controlling for the influence of corruption, international quality certification, external auditor services and firm age. It examines whether ownership and sector effects matter in the explored relationships.
Design/methodology/approach
The study adopts the generalized method of moments estimator and collects firm-level cross-sectional data from 77 MIEs.
Findings
The evidence shows that political uncertainty, employee tenure security and firm age negatively impact firm performance. Also, external quality assurance mainly improves firm performance. Additionally, foreign-owned firms benefit from corruption more than their domestic counterparts. Moreover, there are ownership and sector effects in the firm performance drivers.
Practical implications
The findings suggest the need for MIE firm managers to implement policies and programs to improve permanent employees' efficiency, commitment and honesty. Policy makers and political actors must work toward a stable political environment in MIEs. The policy must also focus on at least minimizing corruption.
Originality/value
The study shows the contributions of employee tenure security, political instability and corruption to the performance of MIE firms. It documents sector and ownership effects in the factors influencing firm performance.
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Nicholas Addai Boamah, Emmanuel Opoku and Augustine Boakye-Dankwa
This study aims to examine the descriptive capabilities of efficiency, liquidity risk and capital risk for the cross-sectional and time-series variations in banks’ performance…
Abstract
Purpose
This study aims to examine the descriptive capabilities of efficiency, liquidity risk and capital risk for the cross-sectional and time-series variations in banks’ performance across emerging economies (EEs). It also examines the impact of the 2008 global financial crisis (GFC) on the effects of capital, liquidity and efficiency on banks’ performance.
Design/methodology/approach
The paper adopts a spatial panel model and collects data across 90 EEs.
Findings
The study shows that a surge in efficiency and liquidity improves bank performance. In addition, banks that finance credit creation primarily with core deposits perform better. Also, banks in EEs responded to the GFC. The findings show that banks in EEs respond to global events emanating from the developed economies. This indicates that EEs banks are relatively integrated with banks in developed markets.
Originality/value
Improvement in profit efficiency and effective liquidity and capital risk management enhance the performance of EEs banks.
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Joseph Oscar Akotey, Godfred Aawaar and Nicholas Addai Boamah
This research explores to answer the question: What accounts for the substantial underwriting losses in the Ghanaian insurance industry?
Abstract
Purpose
This research explores to answer the question: What accounts for the substantial underwriting losses in the Ghanaian insurance industry?
Design/methodology/approach
Thirty-four (34) insurers' audited financial reports covering the period of 2007 to 2017 were analysed through dynamic panel regression to uncover the underlying causes of high underwriting losses in the Ghanaian insurance industry.
Findings
The findings indicate that efforts at increasing market share by overtrading add no value to insurers underwriting profitability. The underwriting risk suggests that the industry charges disproportionately too small premiums for the risks it underwrites. This may indicate under-pricing by some insurers to grow their customer base.
Practical implications
The findings have implications for managerial efficiency and risk management structures that align compensation with underwriting efficiency.
Originality/value
The association between managerial preference and the underwriting performance of insurers in emerging markets has rarely been researched. This study responds to this knowledge challenge.
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The purpose of this paper is to examine the relative importance of global sector effects in African sector portfolios (ASPs). It explores the dynamics of the rate of change and…
Abstract
Purpose
The purpose of this paper is to examine the relative importance of global sector effects in African sector portfolios (ASPs). It explores the dynamics of the rate of change and the level of global sector effects in their respective ASPs.
Design/methodology/approach
The variance of African industry returns is decomposed to the component attributable to the corresponding global industry and the proportion that is African industry specific. The authors then scale the global component by the African sector-specific component to obtain the relative global sector influences in their corresponding ASP returns.
Findings
The evidence suggests that global sector effects are dominated by African industry-specific influences on the African markets; however, in the recent period the global sector influence has risen in importance. Additionally, the 2008 Global Financial Crisis had significant impact in the relative global sector effects in the ASPs. Turning points in the rate of change of and the relative importance of the corresponding global sector effects in the ASPs are identified. The findings infer time-varying global sector effects in their respective ASPs. The evidence suggests sector-level differences in the diversification gain of the ASPs.
Originality/value
The ASPs offer global investors the opportunity for diversification gains when included in geographically diversified portfolio within the same sector, although, global sector effects on the African markets have increased recently.
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Nicholas Addai Boamah, Augustine Boakye-Dankwa and Emmanuel Opoku
The study examines the dynamic association between competition, risk-taking, performance and income diversification of frontier and emerging economy (FEE) banks. It additionally…
Abstract
Purpose
The study examines the dynamic association between competition, risk-taking, performance and income diversification of frontier and emerging economy (FEE) banks. It additionally, explores the effect of banking sector depth and economic performance on the level of competition, performance and risk-taking behavior of banks in these economies.
Design/methodology/approach
The paper adopts a panel vector auto-regressive technique and collects data across ninety (90) FEEs.
Findings
The paper finds that competition increases with improvement in the depth of the banking sector, a surge in risk-taking behavior and the adoption of focused strategy by banks. Similarly, income diversification activities are driven by competition, banking sector depth, the state of the economy and bank performance. Additionally, risk-taking behavior, banking sector depth and the state of the economy are relevant in describing bank performance. Also, risk-taking behavior is influenced by bank performance, banking sector depth and economic growth.
Originality/value
The evidence indicates that although competition improves banking sector health, excessive competition and non-competitive banking environment constrain banks’ performance and stability.
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– The purpose of this paper is to examine the system of development controls in the Offinso South municipality. It investigates the challenges to the development control regime.
Abstract
Purpose
The purpose of this paper is to examine the system of development controls in the Offinso South municipality. It investigates the challenges to the development control regime.
Design/methodology/approach
The paper reviews the land use regulation system in the municipality. The municipality was clustered into four for data collection. Eight neighbourhoods (two from each cluster) were selected from the municipality for the study. In all, 15 properties were sampled via purposive sampling techniques from each of the selected neighbourhoods for data gathering. Self-administered questionnaires were relied on to gather data from the 120 respondents. The property owners were the unit of enquiry.
Findings
The paper finds that socio-cultural factors, delays in the planning approval process, negative public perceptions about the planning process and planning officials, lack of official support to developers in curing identified defects in their proposed developments, and unrealistic building regulations are partly responsible for the large-scale violations of development controls in the municipality.
Practical implications
It is noted that the planning authority should focus more on strategies that will facilitate voluntary compliance and less on enforcement. It also notes the need for a review of the building regulations and the purging of the planning system from negative public perceptions and processing delays.
Originality/value
The paper identifies the constraints on the Ghanaian development controls regime.
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The housing finance market in Ghana is highly underdeveloped. This may be as a result of unfriendly or poor regulatory environment. This paper seeks to examine the regulatory…
Abstract
Purpose
The housing finance market in Ghana is highly underdeveloped. This may be as a result of unfriendly or poor regulatory environment. This paper seeks to examine the regulatory environment and to determine its impact on the development of the formal housing finance market in the country.
Design/methodology/approach
The paper executes this by surveying the housing finance literature. It also carries out a review of the legal framework of the country's mortgage market.
Findings
It is found that inadequate foreclosure rights of lenders before December 2008 constrained the development of the formal housing finance market in Ghana. The research notes that the enactment of the Home Mortgage Finance Act, 2008 (Act 770) in December 2008 has created a conducive legal environment for collateralised lending in the country. This has improved the prospects of developing the housing finance market in the country.
Practical implications
It is noted that a credit bureau industry and mortgage refinancing mechanisms must be put in place if the Act 770, 2008 is to facilitate mortgage market development in the country. It recommends additional policy and institutional reforms.
Originality/value
The paper identifies the legal and institutional constraints on housing finance market development in Ghana.
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