International Journal of Business, Economics and Management

Published by: Conscientia Beam
Online ISSN: 2312-0916
Print ISSN: 2312-5772
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No. 6

Firm-Level Investment Decisions Under Uncertainty and Irreversibility in Zimbabwes Private Firms

Pages: 201-218
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Firm-Level Investment Decisions Under Uncertainty and Irreversibility in Zimbabwes Private Firms

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DOI: 10.18488/journal.62.2018.56.201.218

Joe Muzurura

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Joe Muzurura (2018). Firm-Level Investment Decisions Under Uncertainty and Irreversibility in Zimbabwes Private Firms. International Journal of Business, Economics and Management, 5(6): 201-218. DOI: 10.18488/journal.62.2018.56.201.218
Zimbabwe’s business operating environment is abounding with both micro and macro uncertainties that regularly impact on firm-level investment decisions. Under uncertainty and irreversibility private firms are forced to integrate into their investment appraisals and decisions some expectations regarding future product demand and prices, likely returns on fixed capital investment, expected margins, cost of capital expectations and cash flow projections. These important issues are not known with definitive assurance and hence, making investment decisions under uncertainty a challenging task for Zimbabwe’s private firms. The study examined investment under uncertainty and irreversibility in Zimbabwe’s private firms using a polychotomous regression model with the three investment decision outcomes; “invest now”, “do not invest now” and “defer investment”. The major findings are that; (1) liquidity constraints, firm size and credit constraints significantly influence the probability of investing now irrespective of uncertainties in the economy. (2) Poor public infrastructure, political uncertainty, inconsistent application of the indigenization laws and absence of laws that protect private property rights increase the probability of private firms’ deferring investment decisions under uncertainty and investment irreversibility. The paper recommends that policy makers should reduce macro uncertainties in the financial sector that affect firm-level investment decisions, adopt policies that enhance productivity of public infrastructure and must observe national and international laws that safeguard investor property rights.
Contribution/ Originality
The study is one of the few studies that used a polychotomous probabilistic distribution function to investigate investment decisions of Zimbabwe’s private firms given the presence of uncertainty and investment irreversibility.

An Empirical Investigation into the Key Drivers of Economic Performance in the CEMAC Zone: A Panel Corrected Standard Errors Approach

Pages: 189-200
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An Empirical Investigation into the Key Drivers of Economic Performance in the CEMAC Zone: A Panel Corrected Standard Errors Approach

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DOI: 10.18488/journal.62.2018.56.189.200

Fabien Sundjo , Fozoh Aziseh

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Fabien Sundjo , Fozoh Aziseh (2018). An Empirical Investigation into the Key Drivers of Economic Performance in the CEMAC Zone: A Panel Corrected Standard Errors Approach. International Journal of Business, Economics and Management, 5(6): 189-200. DOI: 10.18488/journal.62.2018.56.189.200
The economic performance of CEMAC countries is severely poor, when compared to other communities of the same region. It is on the bases of this background, that this paper purports to empirically investigate the potential key drivers of economic performance in the CEMAC zone. Specifically, the study attempts to scrutinise the effect of: (a) educational expenditure, (b) gross physical capital formation, (c) public health expenditures, and (d) private health expenditure on economic performance. To ascertain these objectives, data is sourced from the World Bank Development Indicators (WDI) of 2017 and used is made of both descriptive and inferential statistics. The Panel-corrected standard errors (PCSE) regression model was employed to test the objectives, due to its capacity to produce appropriate standard error estimates with very insignificant loss of efficiency. The empirical findings, among others suggested that, all forms of investments included in the model, significantly influenced the economic performance of countries in the CEMAC sub-region. Specifically, the results showed that educational expenditure and gross physical capital formation positively influence economic performance in the CEMAC zone. Intriguingly, public and private health expenditures negatively influence economic performance in the said zone. The policy implications of these findings suggest that, emphasis should be laid on increasing investment on government’s educational expenditure and gross physical capital formation in the CEMAC zone, if economic performance must be revived.
Contribution/ Originality
This study uses panel corrected standard errors approach, to scrutinize the causal relationship between the CEMAC economic performance and variables like educational expenditure, gross physical capital formation and public and private health expenditures.

Foreign Capital Inflows and Unemployment in Nigeria: A New Evidence from ARDL-Bounds Testing Approach

Pages: 176-188
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Foreign Capital Inflows and Unemployment in Nigeria: A New Evidence from ARDL-Bounds Testing Approach

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DOI: 10.18488/journal.62.2018.56.176.188

Onyinye I. Anthony-Orji , Anthony- Orji , Jonathan E. Ogbuabor , Emmanuel O. Nwosu

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Onyinye I. Anthony-Orji , Anthony- Orji , Jonathan E. Ogbuabor , Emmanuel O. Nwosu (2018). Foreign Capital Inflows and Unemployment in Nigeria: A New Evidence from ARDL-Bounds Testing Approach. International Journal of Business, Economics and Management, 5(6): 176-188. DOI: 10.18488/journal.62.2018.56.176.188
Using a novel approach, this study disaggregates and estimates the impact of foreign capital inflows on unemployment in Nigeria by adopting the Auto-Regressive Distributed Lag- Unrestricted Error Correction Methodology (ARDL-UECM). The ARDL-bounds test co-integration results show evidence of co-integration between disaggregated Foreign Capital Inflow variables (such as Foreign Direct Investment, Foreign Portfolio Investment and Remittances) and unemployment rate in Nigeria within the period from 1977Q1 – 2013Q4. The empirical results also show that foreign direct investment, foreign private investment and trade openness have negative impact on unemployment rate. On the other hand and interestingly, remittances and real exchange rate show a positive impact. The study therefore recommends the routing of remittances through the banking channels which would help in allocating remittances and other financial flows to productive uses. Again, government should enact investor-friendly policies and build conducive business environment in order to attract more Foreign Capital Inflows which will support job creation for the teeming population and thereby reduce biting unemployment.
Contribution/ Originality
This study contributes to the existing literature by adopting the Auto-Regressive Distributed Lag- Unrestricted Error Correction Methodology (ARDL-UECM) in estimating the impact of disaggregated foreign capital inflows on unemployment in Nigeria.

Measuring and Assessing the State of Technological Innovations and the Level of Interaction between Rice Processors and Stakeholders in Rice Processing Industry in Nigeria

Pages: 164-175
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Measuring and Assessing the State of Technological Innovations and the Level of Interaction between Rice Processors and Stakeholders in Rice Processing Industry in Nigeria

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DOI: 10.18488/journal.62.2018.56.164.175

AKINTELU Sunday Olufemi

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AKINTELU Sunday Olufemi (2018). Measuring and Assessing the State of Technological Innovations and the Level of Interaction between Rice Processors and Stakeholders in Rice Processing Industry in Nigeria. International Journal of Business, Economics and Management, 5(6): 164-175. DOI: 10.18488/journal.62.2018.56.164.175
The study examined the state of technological innovations in rice processing industry and investigated the level of interaction that exists between rice processors and stakeholders involved in rice processing operations in Nigeria. Data were collected from 35 (12 integrated and 23 medium and small-scale mills) rice processing firms in four geopolitical zones of Nigeria through the use of questionnaire. These firms were selected using snow balling sampling technique. The questionnaire elicited information on the state of technological innovations in the firms and the level of existing interactions among rice processors and relevant stakeholders. Data were analyzed using descriptive statistics. The result showed that majority (71.4%) of the firms had technological innovations involving introduction and improvement of existing product and 45.7% of them had technological innovations involving introduction of a new process and improvement of the existing process. More than two thirds (82.9%) of the firms carried out technological innovations mainly by themselves. Also, 65.7% of the technological innovations originated mainly in Nigeria, 31.4% were imported while 2.9% were sourced jointly in Nigeria and abroad. The results further showed that the firms have low (mean < 2.58) level of interactions with important stakeholders such as banks, local suppliers of equipment, universities/research institutes, foreign firms and government with a mean of 2.91, 2.57, 2.49, 2.09 and 1.86 respectively. The study concluded that to enhance technological innovation in Nigerian rice processing industry, there is a need for the development of strong linkage between the industry and the stakeholders involved in rice processing operations.
Contribution/ Originality
This study has contributed to the existing literature through the establishment of the state of technological innovations identifiable in rice processing industry. It also provides the existing relationship between rice processors and stakeholders involved in rice processing operations.

Does Gold Price Lead or Lags Islamic Stock Market and Strategy Commodity Price? A Study from Malaysia

Pages: 146-163
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Does Gold Price Lead or Lags Islamic Stock Market and Strategy Commodity Price? A Study from Malaysia

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DOI: 10.18488/journal.62.2018.56.146.163

Siti Nurulhuda Ibrahim , Rahayu Hasan , Amirudin Mohd Nor

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Siti Nurulhuda Ibrahim , Rahayu Hasan , Amirudin Mohd Nor (2018). Does Gold Price Lead or Lags Islamic Stock Market and Strategy Commodity Price? A Study from Malaysia. International Journal of Business, Economics and Management, 5(6): 146-163. DOI: 10.18488/journal.62.2018.56.146.163
There is a few claimed in literature and financial media that gold, Islamic stock and commodity market provide as hedging tool against inflation. Therefore, derive from this similarity characteristic, we are interested to know which among of this investment variety are the leader and laggard in the Malaysian market. Among of them, numerous studies have been done on gold as a hedge against inflation, but almost non-existence amount of research endeavor to analyze the lead-lag of this precious metal with other investment avenues. Thus, several methods are employed to answer the issue of this study which are unit root tests and Johansen’s cointegration test, followed by long-run structural modelling (LRSM) and vector error-correction modelling (VECM), variance decompositions (VDCs), impulse response functions (IRFs) and persistence profile (PP). The results showed that spot Kijang Gold lags all investment avenues in Malaysia. It indicated that the performance of the Kijang Gold is dependent on FTSE Bursa Malaysia Emas Shariah Index, macroeconomic variables and strategic commodities. This provides some important policy implications in the regulation of the Kijang Gold itself whereby FTSE Bursa Malaysia Emas Shariah Index performance and other variables are among the key predictive inputs on the expected performance of the Kijang Gold. Hence, we humbly suggest to the investors and investment portfolio managers to include Islamic shariah equities, crude palm oil and crude oil commodities as part of their investment portfolios as may act as diversification and hedging tool especially for an investment portfolio which consists of Kijang Gold and forex, as we had identified these latter investment avenues as the most follower (endogenous) variables.
Contribution/ Originality
This study is one of very few studies which have investigated the lead-lag analysis among these three-investment avenues by using VECM, VDCs and other related techniques. Furthermore, this study attempts to fill the gap in empirical studies and associated theory which remains unexplored and not broadly discussed in the literature.

Employee Loyalty and Organizational Citizenship Behaviour in the Port Harcourt Area Command of the Nigeria Police Force

Pages: 135-145
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Employee Loyalty and Organizational Citizenship Behaviour in the Port Harcourt Area Command of the Nigeria Police Force

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DOI: 10.18488/journal.62.2018.56.135.145

UNAAM, Akaninyene Okon , ADIM, Chidiebere Victor , ADUBASIM, Ernest Ikechukwu

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UNAAM, Akaninyene Okon , ADIM, Chidiebere Victor , ADUBASIM, Ernest Ikechukwu (2018). Employee Loyalty and Organizational Citizenship Behaviour in the Port Harcourt Area Command of the Nigeria Police Force. International Journal of Business, Economics and Management, 5(6): 135-145. DOI: 10.18488/journal.62.2018.56.135.145
This study examined the relationship between employee loyalty and organizational citizenship behaviour in the Port Harcourt Area Command of the Nigeria Police Force. The study adopted a cross-sectional survey research design. The primary source of data was a structured self-administered questionnaire. The population of this study consists of Senior Police officers from the rank of Assistant Superintendent of Police (ASP) and above, and the other ranks made up of Inspectors and Non-Commissioned Officers (NCOs) working in the twenty-seven (27) Police Divisions distributed in four (4) Local Government Areas of Rivers State, Nigeria which has a total staff strength of 14,886. Due to the large size of the population, the Taro Yamane Sample Size determination techniques were used to determine the sample size of 390 employees, which were selected through stratified random sampling. Internal reliability of the instrument was achieved through the Cronbach Alpha coefficient with items being above 0.70. After data cleaning, only data of 332 respondents were finally used for data analysis. The Pearson's Product Moment Correlation tool was used for hypothesis testing. The study findings revealed that there is a positive significant relationship between employee loyalty and organizational citizenship behaviour. The study thus concluded that employee loyalty bears a positive and significant influence on organizational citizenship. Managers should endeavour to develop a supportive connection with employees in a manner that would enhance employees desire to act or perform beyond their required role.
Contribution/ Originality
This study is one of the few studies to have investigated employee loyalty and organizational citizenship behaviour in the Port Harcourt Area Command of The Nigeria Police Force.