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1 – 10 of over 1000Ashlyn Maria Mathai and Mahesh Kumar
In this paper, a mixture of exponential and Rayleigh distributions in the proportions α and 1 − α and all the parameters in the mixture distribution are estimated based on fuzzy…
Abstract
Purpose
In this paper, a mixture of exponential and Rayleigh distributions in the proportions α and 1 − α and all the parameters in the mixture distribution are estimated based on fuzzy data.
Design/methodology/approach
The methods such as maximum likelihood estimation (MLE) and method of moments (MOM) are applied for estimation. Fuzzy data of triangular fuzzy numbers and Gaussian fuzzy numbers for different sample sizes are considered to illustrate the resulting estimation and to compare these methods. In addition to this, the obtained results are compared with existing results for crisp data in the literature.
Findings
The application of fuzziness in the data will be very useful to obtain precise results in the presence of vagueness in data. Mean square errors (MSEs) of the resulting estimators are computed using crisp data and fuzzy data. On comparison, in terms of MSEs, it is observed that maximum likelihood estimators perform better than moment estimators.
Originality/value
Classical methods of obtaining estimators of unknown parameters fail to give realistic estimators since these methods assume the data collected to be crisp or exact. Normally, such case of precise data is not always feasible and realistic in practice. Most of them will be incomplete and sometimes expressed in linguistic variables. Such data can be handled by generalizing the classical inference methods using fuzzy set theory.
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Nooshin Karimi Alavijeh, Mohammad Taher Ahmadi Shadmehri, Fatemeh Dehdar, Samane Zangoei and Nazia Nazeer
While science has researched the impact of air pollution on human health, the economic dimension of it has been less researched so far. Renewable energy consumption is an…
Abstract
Purpose
While science has researched the impact of air pollution on human health, the economic dimension of it has been less researched so far. Renewable energy consumption is an important factor in determining the level of life expectancy and reducing health expenditure. Thus, this study aims to investigate the impact of renewable energy, carbon emissions, health expenditure and urbanization on life expectancy in G-7 countries over the period of 2000–2019.
Design/methodology/approach
This study has adopted a novel Method of Moments Quantile Regression (MMQR). Furthermore, as a robustness check for MMQR, the fully modified ordinary least square, dynamic ordinary least squares and fixed effect ordinary least square estimators have been used.
Findings
The results indicated that renewable energy consumption, health expenditure and urbanization lead to an increase in life expectancy across all quantiles (5th to 95th), whereas higher carbon dioxide emissions reduce life expectancy at birth across all the quantiles (5th to 95th).
Practical implications
The empirical findings conclude that governments should recognize their potential in renewable energy sources and devise policies such as tax-related regulations, or relevant incentives to encourage further investments in this field.
Originality/value
This paper in comparison to the other research studies used MMQR to investigate the impact of factors affecting life expectancy. Also, to the best of the authors’ knowledge, so far no study has investigated the impact of renewable energy on life expectancy in G-7 countries.
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P.K. Priyan, Wakara Ibrahimu Nyabakora and Geofrey Rwezimula
The study aims to evaluate the influence of capital structure decisions and asset structure on firms' performance for East African listed nonfinancial firms.
Abstract
Purpose
The study aims to evaluate the influence of capital structure decisions and asset structure on firms' performance for East African listed nonfinancial firms.
Design/methodology/approach
The research is descriptive and employs secondary data from the East African capital markets' websites. The generalized method of moments approach is used to estimate the relationship due to its ability to account for endogeneity problems.
Findings
The result shows that capital structure decisions and asset structure strongly influence the firms' performance. When long-term debts, short-term debts and tangible fixed assets increase, the return on total assets increases. An increase in the total debt ratio raises the return on equity (ROE). However, the increase in long-term debt lowers the ROE.
Practical implications
The results will help investors and potential investors decide on a financing policy that maximizes performance. Likewise, governments and other policymakers review the capital markets' frameworks to attract institutional and individual investors to the markets for financial availability and to increase profitability.
Originality/value
The research provides evidence on the influence of capital structure decisions and asset structure on firms' performance. Furthermore, its results contribute to firms' financing policy formulation and the corporate finance literature.
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The main objective of this article is to analyze the role of governance quality in influencing the economic growth of 22 selected Sub-Saharan African Countries.
Abstract
Purpose
The main objective of this article is to analyze the role of governance quality in influencing the economic growth of 22 selected Sub-Saharan African Countries.
Design/methodology/approach
The study applied the panel dynamic Generalized Method of Moments (GMM) to analyze the data obtained from the World Bank database over the period from 2002 to 2020.
Findings
The overall finding indicated that the composite governance index has a positive significant effect on the economic growth of the countries; where a unit improvement in the aggregate governance index leads to a 3.05% increase in GDP. The disaggregated result has shown that corruption control and government effectiveness have a negative significant effect on growth performance, whereas, the rule of law and regulatory quality showed a positive significant effect. Political stability and voice and accountability have an insignificant effect on economic growth.
Research limitations/implications
Due to data limitations, this study could not address the whole members of Sub Sahara African Countries and could not see the causal relationship.
Practical implications
The study suggested a strong commitment to the implementation of policy and reform measures on all governance factors. This may add to the need to devise participatory corruption control mechanisms; to closely look at the proper implementation of policies and reforms that constitute the government effectiveness factors, and properly implement the rule of law at all levels of the government with a strong commitment to realizing it so that citizens at all levels can have full confidence in and abide by the rules of society.
Originality/value
Even though there are some studies conducted using conventional methods of panel data analysis such as random effect or fixed effects, this empirical study used more advanced panel dynamic generalized moment of methods to examine the role of improvement in governance quality on economic growth.
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Muhammad Mushafiq, Syed Ahmad Sami, Muhammad Khalid Sohail and Muzammal Ilyas Sindhu
The main purpose of this study is to evaluate the probability of default and examine the relationship between default risk and financial performance, with dynamic panel moderation…
Abstract
Purpose
The main purpose of this study is to evaluate the probability of default and examine the relationship between default risk and financial performance, with dynamic panel moderation of firm size.
Design/methodology/approach
This study utilizes a total of 1,500 firm-year observations from 2013 to 2018 using dynamic panel data approach of generalized method of moments to test the relationship between default risk and financial performance with the moderation effect of the firm size.
Findings
This study establishes the findings that default risk significantly impacts the financial performance. The relationship between distance-to-default (DD) and financial performance is positive, which means the relationship of the independent and dependent variable is inverse. Moreover, this study finds that the firm size is a significant positive moderator between DD and financial performance.
Practical implications
This study provides new and useful insight into the literature on the relationship between default risk and financial performance. The results of this study provide investors and businesses related to nonfinancial firms in the Pakistan Stock Exchange (PSX) with significant default risk's impact on performance. This study finds, on average, the default probability in KSE ALL indexed companies is 6.12%.
Originality/value
The evidence of the default risk and financial performance on samples of nonfinancial firms has been minimal; mainly, it has been limited to the banking sector. Moreover, the existing studies have only catered the direct effect of only. This study fills that gap and evaluates this relationship in nonfinancial firms. This study also helps in the evaluation of Merton model's performance in the nonfinancial firms.
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João Jungo, Mara Madaleno and Anabela Botelho
This study aims to examine the role of financial inclusion and institutional factors such as corruption and the rule of law (RL) on the credit risk and stability of banks.
Abstract
Purpose
This study aims to examine the role of financial inclusion and institutional factors such as corruption and the rule of law (RL) on the credit risk and stability of banks.
Design/methodology/approach
The study considers a sample of 61 developing countries and uses very robust estimation techniques that allow controlling for endogeneity, heteroskedasticity and serial correlation, such as instrumental variables method in two-stage least squares (IV-2SLS), instrumental variables generalized method of moments (IV-GMM), as well as system of generalized methods of moments in two stages (Sys-2GMM).
Findings
The results confirm that financial inclusion and strengthening the RL can significantly contribute to reducing credit risk and improving the financial stability of banks; in contrast, the authors find that weak control of corruption aggravates credit risk. In addition, they found that greater competitiveness in the banking sector increases credit risk.
Social implications
This study supports the need to promote financial inclusion and strengthen institutional factors to improve the stability of the banking sector, as well as promote general well-being in the economy.
Originality/value
This study contributes to the scarce literature by simultaneously using institutional factors such as corruption and the RL and macroeconomic variables such as economic growth and inflation in the relationship between financial inclusion and the banking sector, as well as considering competitiveness as an explanatory factor for banks’ credit risk and stability.
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Charles Ogechukwu Ugbam, Chi Aloysius Ngong, Ishaku Prince Abner and Godwin Imo Ibe
This study examines the nexus of bond market development and economic growth from 2015 to 2022.
Abstract
Purpose
This study examines the nexus of bond market development and economic growth from 2015 to 2022.
Design/methodology/approach
The system-generalized method of moments (GMM) is employed on economic growth, government market capitalization, corporate market capitalization, bond yield, interest rate spread, trade openness and investment level.
Findings
The findings show that the government bond market, corporate bond capitalization and bond yield positively impact the gross domestic product (GDP). The results equally reveal a causal link between the corporate bond market, bond yield and GDP.
Research limitations/implications
Governments should emphasize creating, developing and sustaining bond markets in the economies of developing countries to boost economic activity by promoting structural transformation. Policymakers should improve the implementation of existing rules and regulations while complementing them with new ones since well-developed bond markets provide alternative sources of financing that make economies financially resilient. Policymakers should encourage the issuance of corporate bonds to enhance the efficiency of the capital markets and mobilize funds for economic growth stimulation. Governments and corporations should diversify their sources of funding into the bond markets since the bond yields are favorable to economic growth.
Originality/value
Earlier studies presented arguable results on the bond market development and economic growth nexus. Several findings indicate a positive link; others give a negative link between bond market development and economic growth. Some show causal directions, while other reveal none. The contradictory results motivate research. This research results contribute to the literature in that the government bond market, corporate bond capitalization and bond yield positively impact the GDP of developing nations.
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Godwin Olasehinde-Williams, Ifedolapo Olanipekun and Ojonugwa Usman
This paper aims to examine the reaction of energy inflation to geopolitical risks in the European Economic Area between 1990 and 2015.
Abstract
Purpose
This paper aims to examine the reaction of energy inflation to geopolitical risks in the European Economic Area between 1990 and 2015.
Design/methodology/approach
This study applies the nonparametric time-varying coefficient panel data model with fixed effects. In addition, to further reveal potential tail effects that may not have been captured by conditional mean-based regressions, the method of moments quantile regression was also used.
Findings
The findings of this study are as follows: first, as European countries get exposed to geopolitical tensions, it is expected that energy prices will surge. Second, the ability of geopolitical risk to trigger energy inflation in recent times is not as powerful as it used to be. Third, countries with a lower inflation rate, when exposed to geopolitical risks, experience smaller increases in energy inflation compared to countries with a higher inflation rate.
Research limitations/implications
The findings of this study lead us to the conclusion that transitioning from nonrenewable to renewable energy use is one channel through which the sampled countries can battle the energy inflation, which geopolitical risks trigger. A sound macroeconomic policy for inflation control is a complementary channel through which the same goal can be achieved.
Originality/value
Given the increasing level of energy inflation and geopolitical risks in the world today, this study is an attempt to reveal the time-varying characteristics of the relationship between these variables in European countries using a nonparametric time-varying coefficient panel data model and method of moments quantile regression with fixed effects.
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Muhammad Sajid, Amanat Ali, Sareer Ahmad, Nikhil Chandra Shil and Izaz Arshad
This study empirically examines the impact of some domestic as well as global factors such as trade openness (TO), money supply (MS), exchange rate, global oil prices (GOPs) and…
Abstract
Purpose
This study empirically examines the impact of some domestic as well as global factors such as trade openness (TO), money supply (MS), exchange rate, global oil prices (GOPs) and interest rate (IR) on inflation.
Design/methodology/approach
This study deploys a quantitative method considering 30 years of data (1991–2020) from four South Asian countries, namely, Sri Lanka, Pakistan, Bangladesh and India. To determine the potential impact of different factors on inflation, this study applies the panel analysis of the system generalized method of moments (SGMM).
Findings
This study empirically finds that TO, MS, exchange rate and GOPs have a positive impact on inflation, while IR and the structural adjustment program (SAP) have a negative impact on inflation. Out of the various determinants considered in this study, TO, exchange rate and the SAP are insignificant, while the rest of the variables are significant and consistent with previous studies.
Practical implications
This study informs policymakers about maintaining price stability and fostering economic growth in South Asian nations. It breaks new ground as the first empirical examination of the International Monetary Fund (IMF)’s SAP impact on inflation in the region.
Originality/value
This study tries to find out whether the SAP of the IMF is responsible for inflation in South Asian countries. It gives renewed attention to the causality of inflation from the perspective of countries receiving loans from donors, especially the IMF.
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The financial world of today is evolving at a rate that can be challenging to keep up with and comprehend due to developments in information and communication technology. When…
Abstract
Purpose
The financial world of today is evolving at a rate that can be challenging to keep up with and comprehend due to developments in information and communication technology. When compared to a conventional disclosure, the eXtensible Business Reporting Language (XBRL), which was named one of the top ten accounting technologies, has a clear advantage in reducing information asymmetry by providing interactive data disclosure. This study aims to examine whether forcing companies to adopt XBRL would cause them to prefer misclassifying income statement items as an alternative to more risky earnings management methods.
Design/methodology/approach
The study sample includes nonfinancial UAE companies listed on Dubai Financial Market and Abu Dhabi Securities Exchange from 2012 to 2019. Fixed effect and system General Method of Moments regressions were used to analyze the study data.
Findings
The study found that XBRL reporting resulted in lowering the quality of financial reporting as companies have a higher tendency to misclassify income statement items as earnings management mechanism.
Practical implications
The findings of this research can be used by stakeholders and practitioners in the UAE to better understand whether the use of XBRL is linked to the engagement of financial reporting manipulative practices. The findings of this study also inform policymakers and regulators about the consequences of companies formally adopting digital disclosure language in an effort to improve the quality of their reporting. Besides, the results offer guidance to regulators considering imposing XBRL usage regulations.
Originality/value
Limited number of studies have tested the association between XBRL mandatory adoption and misclassification of income statement items as an earnings management tool in the Gulf Cooperation Council region.
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