The effect of corruption on bank profitability

2019 ◽  
Vol 26 (3) ◽  
pp. 753-773 ◽  
Author(s):  
Segun Thompson Bolarinwa ◽  
Funmi Soetan
Keyword(s):  
Developing Countries ◽  
Method Of Moments ◽  
Design Methodology ◽  
Generalized Method Of Moments ◽  
Panel Cointegration ◽  
Developed Countries ◽  
Emerging Countries ◽  
Bank Profitability ◽  
Content Type ◽  
Positive Effect

Purpose This paper aims to investigate the effect of corruption on bank profitability. Design/methodology/approach The paper adopts panel cointegration, differenced generalized method of moments (GMM) and system GMM. Findings The empirical results show that corruption is important in explaining the profitability of commercial banks in both developed and emerging countries. While it has mixed effects in emerging countries, only positive effect is validated in developed countries. Research limitations/implications Macroeconomic measures of corruption are adopted in the study. Originality/value The paper contributes to the literature on corruption and bank profitability by reporting evidence from both developed and developing countries. Existing papers have only concentrated on developing countries.

Determinants of bank profitability in Tunisia: does corruption matter?

2017 ◽  
Vol 20 (1) ◽  
pp. 70-78 ◽  
Author(s):  
Khemaies Bougatef
Keyword(s):  
Method Of Moments ◽  
Commercial Banks ◽  
Design Methodology ◽  
Generalized Method Of Moments ◽  
Surprising Result ◽  
Bank Profitability ◽  
Content Type ◽  
Method Of Moments Estimator ◽  
Asset Quality ◽  
High Level

Purpose In this paper, the author aims to examine the effect of perceived level of corruption on bank profitability. Design/methodology/approach The analysis is based on a balanced panel of ten commercial banks in Tunisia over the period 2003-2014. The author uses the generalized method of moments estimator technique described by Arellano and Bover (1995). Findings The author finds a positive relationship between the bank profitability and the corruption level. This surprising result suggests that Tunisian commercial banks take advantage from the high level of corruption. Regarding the others determinants, the findings reveal that bank profitability is positively related to capitalization level and liquidity. By contrast, a low asset quality is associated with low profitability. Originality/value The novelty of this study consists in the inclusion of the corruption level as a determinant of bank profitability.

Assessing the bank profitability in the MENA region

2014 ◽  
Vol 7 (3) ◽  
pp. 305-332 ◽  
Author(s):  
Rim Ben Selma Mokni ◽  
Houssem Rachdi
Keyword(s):  
Method Of Moments ◽  
North Africa ◽  
Banking Sector ◽  
Middle Eastern ◽  
Generalized Method Of Moments ◽  
Mena Region ◽  
Bank Profitability ◽  
Content Type ◽  
Conventional Banks ◽  
Econometric Technique

Purpose – Which of the banking stream is relatively more profitable in Middle Eastern and North Africa (MENA) region? Design/methodology/approach – The empirical study covers a sample of 15 conventional and 15 Islamic banks for the period 2002-2009.The authors estimate models using the generalized method of moments in system, of Blundell and Bond (1998). They exploit an up-to-date econometric technique which takes into consideration the issue of endogeneity of regressors to evaluate the comparative profitability of Islamic and conventional banks in the MENA region. Findings – Empirical analysis results show that the determinants’ significance varies between Islamic and conventional banks. Profitability seems to be quite persistent in the MENA region reflecting a higher degree of government intervention and may signal barriers to competition. Originality/value – The main interest is to develop a comprehensive model that integrates macroeconomic, industry-specific and bank-specific determinants. The paper makes comparison of the performance between two different banking systems in the MENA region. The authors consider a variable crisis to gain additional insights into the impacts of the financial crisis on MENA banking sector.

The difference in the FDI – private investment relationship between developed and developing countries: does it stem from governance environment?

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Van Bon Nguyen
Keyword(s):  
Developing Countries ◽  
Design Methodology ◽  
Good Governance ◽  
Trade Openness ◽  
Private Investment ◽  
Developed Countries ◽  
Tax Revenue ◽  
Content Type ◽  
Governance Environment ◽  
The Difference

PurposeThe paper attempts to empirically examine the difference in the foreign direct investment (FDI) – private investment relationship between developed and developing countries over the period 2000–2013.Design/methodology/approachThe paper uses the two-step GMM Arellano-Bond estimators (both system and difference) for a group of 25 developed countries and a group of 72 developing ones. Then, the PMG estimator is employed to check the robustness of estimates.FindingsFirst, there is a clear difference in the FDI – private investment relationship between developed countries and developing ones. Second, governance environment, economic growth and trade openness stimulate private investment. Third, the effect of tax revenue on private investment in developed countries is completely opposite to that in developing ones.Originality/valueThe paper is the first to provide empirical evidence to confirm the dependence of FDI – private investment relationship on governance environment. In fact, contrary to the view (arguments) in Morrissey and Udomkerdmongkol (2012), the paper indicates that FDI crowds out private investment in developed countries (good governance environment), but crowds in developing countries (poor governance environment).

Complex network analysis for international talent mobility based on bibliometrics

2019 ◽  
Vol 11 (3) ◽  
pp. 419-435
Author(s):  
Yinqiu Wang ◽  
Hui Luo ◽  
Yunyan` Shi
Keyword(s):  
Developing Countries ◽  
Linear Regression ◽  
Multiple Linear Regression ◽  
Complex Network ◽  
Design Methodology ◽  
Developed Countries ◽  
Bibliometric Data ◽  
Content Type ◽  
Negative Factor ◽  
The World

Purpose This paper aims to explore international talent mobility and identify its negative/positive factors. Design/methodology/approach Bibliometric data from Scopus are explicated to model the mobility network and providing a more comprehensive posture. In addition, by using indicators of complex network, significant features of international talent mobility are described quantitatively. After that, by introducing a kind of improved gravity model with multiple linear regression, the authors identify factors to explain international talent mobility flows. Findings With the analysis of international talent mobility in complex network, the overall network is not balanced. A small part of developed countries and developing countries with good emergency attract and drain a lot of talents and talents usually moving between these countries, the amount of talents leaving or entering into other countries is very limited. Furthermore, according to multiple linear regression, it is found that the share of migrants in population is the major negative factor for international talent mobility, and the factors of destination countries is more significant than original countries. Originality/value The result of this paper may support further research studies and political suggestions for cultivating, attracting and retaining scientific and technological talents in the world.

Bank-based and market-based development and economic growth: an international investigation

2019 ◽  
Vol 36 (3) ◽  
pp. 365-394 ◽  
Author(s):  
Isaac Boadi ◽  
Daniel Osarfo ◽  
Perpetual Boadi
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Method Of Moments ◽  
Design Methodology ◽  
Generalized Method Of Moments ◽  
Fixed Effect ◽  
Relative Impact ◽  
Content Type ◽  
Regional Effects ◽  
Development Policies

Purpose The purpose of this paper is to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60countries. Design/methodology/approach This study uses fixed effect and generalized method of moments (GMM) to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60 countries. The study further controls regional effects and the Asian crisis, as well as the global economic crisis. Findings The empirical results of the study revealed that market-based development positively affects economic growth. Besides, market-based financial development indirectly promotes investment, which has the potential to strongly enhance growth. The findings of this study, therefore, provide more support to pro-market-based financial development policies in these regions. Interestingly, bank-based development has no direct impact on development, but indirectly encourages investment, which also promotes growth. Originality/value This paper is the first of its kind to empirically examine fixed effect and GMM to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60 countries.

scholarly journals Steps towards a CSR binding paradigm

2019 ◽  
Vol 15 (2) ◽  
pp. 119-124
Author(s):  
Léna Masson
Keyword(s):  
Developing Countries ◽  
Human Rights ◽  
Multinational Corporations ◽  
Design Methodology ◽  
Developed Countries ◽  
Labor Standards ◽  
Global Regulation ◽  
Content Type ◽  
Voluntary Regulation ◽  
Private Power

Purpose The purpose of this paper is to pursue the dialogue on the global firms’ regulation vis-à-vis human rights and labor standards in developing countries. Design/methodology/approach Locke’s book The Promise and Limits of Private Power is analyzed and discussed with respect to more recent global regulation literature and mechanisms. Findings Locke advocates that private voluntary regulation has to be combined with local laws in developing countries to fully enforce labor standards and workers’ rights. In light of recent changes, the interesting model proposed by Locke shows some weaknesses. Originality/value To enforce labor standards and workers’ rights in developing countries, the author argue that governments in developed countries need to be seen as major players in multinational corporations (MNCs) regulations. But above all, the economic model needs to be questioned.

Does the country’s religion affect the financial performance of conventional and Islamic banks? Comparative study in the international framework

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Achraf Haddad ◽  
Achraf Haddad
Keyword(s):  
Financial Performance ◽  
Generalized Method Of Moments ◽  
Developed Countries ◽  
Emerging Countries ◽  
Islamic Banks ◽  
Governance Mechanism ◽  
Content Type ◽  
Conventional Banks ◽  
The Impact ◽  
Conventional And Islamic Banks

Purpose The purpose of this study is to compare the impact of religion on the financial performance of conventional and Islamic banks in the framework of stakeholders’ theory. Design/methodology/approach Few studies have focused on studying the impact of religion on banking performance. Although religion represents an external governance mechanism for financial institutions, by using the generalized method of moments (GMM), this topic constitutes a research opportunity. The already modeled variables are collected from 76 countries located on 5 continents. The data were collected from DATASTREAM, banks’ annual reports, WIKIPEDIA and World Bank. It concerns 210 banks of each type during the period (2010–2020). Findings The author retained that religion negatively affects the financial performance of both conventional and Islamic banks. More specifically, results showed that religion affected the liquidity and solvency of two bank types. It also affected conventional banks’ profitability and efficiency of conventional banks. Research limitations/implications I summarized the theoretical contribution in the integration of a new original governance category to enhance its presence with impacts directly affecting the banks’ financial performance. Empirically, the study can be seen as a compass for all stakeholders to consider environmental, behavioral and doctrinal factors in studying the financial performance evolution and to become more competitive in the banking market. Originality/value Although conventional banks located in developed countries are different from those existing in emerging countries and Islamic banks located in developed countries are different from those existing in emerging countries, I carried out a diversified study in the global context. Referring to the comparative literature review between conventional and Islamic banks, the study was the first conditional research that compared the impacts of religion on the financial performance of conventional and Islamic banks.

How companies from developing and emerging countries can leverage their brand equity in terms of place branding

2014 ◽  
Vol 24 (4) ◽  
pp. 293-305 ◽  
Author(s):  
Ram Herstein ◽  
Ron Berger ◽  
Eugene D. Jaffe
Keyword(s):  
Developing Countries ◽  
Conceptual Model ◽  
Developed Countries ◽  
Emerging Countries ◽  
Two Dimensions ◽  
Branding Strategy ◽  
Content Type ◽  
Country Branding ◽  
Emerging And Developing Countries ◽  
Made In

Purpose – The purpose of this conceptual paper is to present a new approach that will enable marketers in developing and emerging countries to promote their products, irrespective of their country of origin’s image. Many companies in emerging and developing countries, intent on exporting their products/services, struggle to overcome the negative “made-in” image barrier. Despite tremendous efforts by the governments of these countries to change the unfavorable image of products made there, their good quality products are still perceived as inferior compared to companies whose products are “made-in” in countries with a positive image, mainly developed countries. Design/methodology/approach – The proposed conceptual model hinges on two dimensions – global political status and human capital capabilities. Using this framework, four different types of country destination positioning emerge, each with its own country branding strategy. Findings – Companies from emerging and developing countries can compete on an equal footing with Western companies by changing their country branding strategy. Companies from countries such as China and Costa Rica can promote themselves better by implementing region and continent branding strategies. Practical implications – The proposed conceptual model enables marketers to cope even with the most negative “made-in” country stereotypes and improve their marketplace positions. Originality/value – The literature review demonstrates that researchers have not dealt with these two dimensions. Consequently, the paper offers marketers a new perspective on the complex issue of country positioning and how to leverage their strengths to maximize their company’s profits.

Re-examining the determinants of bank profitability in Nigeria

2019 ◽  
Vol 46 (3) ◽  
pp. 633-651 ◽  
Author(s):  
Segun Thompson Bolarinwa ◽  
Olufemi Bodunde Obembe ◽  
Clement Olaniyi
Keyword(s):  
Developing Countries ◽  
Cost Efficiency ◽  
Banking Industry ◽  
Generalized Method Of Moments ◽  
Standard Measure ◽  
Bank Profitability ◽  
Content Type ◽  
Frontier Analysis ◽  
Managerial Efficiency

Purpose The purpose of this paper is to re-examine the determinants of bank profitability in Nigeria. Specifically, the study investigates the effect of managerial cost efficiency on bank profitability. Also, since there exist mixed results and controversies in the literature, in both developed and developing countries, regarding the effect of efficiency on bank profitability, this study employs the standard measure of efficiency. In addition, the work incorporates the role of persistence, which is often neglected in the literature in developing countries. Design/methodology/approach This study employs system generalized method of moments. Findings The findings, using the case of Nigeria, show that cost efficiency is a strong determinant of bank profitability in developing countries. In addition, the profitability of banks in Nigeria persists over time; hence, the industry is fairly competitive. Research limitations/implications The recent policies of banking industry recapitalization meant to increase profitability and stability in Nigeria and other African countries’ banking industry will not be effective if the issue of managerial efficiency is not properly addressed. Practical implications Improving the banking managerial efficiency will positively reduce bad loans, hence leading to the stability in the banking system. Originality/value The authors introduce efficiency using standard measure of stochastic frontier analysis for its measurement. Also, this study introduces the role of persistence in the literature in developing countries.

Franchising and value signaling

2014 ◽  
Vol 28 (2) ◽  
pp. 105-115 ◽  
Author(s):  
Laura Lucia-Palacios ◽  
Victoria Bordonaba-Juste ◽  
Melih Madanoglu ◽  
Ilan Alon
Keyword(s):  
Method Of Moments ◽  
Support Services ◽  
Design Methodology ◽  
Generalized Method Of Moments ◽  
Financial Assistance ◽  
Content Type ◽  
Contractual Arrangements ◽  
Using Data ◽  
New Evidence ◽  
Area Development

Purpose – The purpose of this paper is to demonstrate how signaling support services and contractual arrangements that create value for incumbent franchisees can help to create value for the whole network by attracting prospective franchisees. Design/methodology/approach – Using data from Bond's Franchising Report the study analyses franchisors operating between 1994 and 2008 via a Generalized Method of Moments (GMM) model for an unbalanced panel of 2,474 franchisors. Findings – Training, financial assistance, sub-franchising and restrictions against passive ownership, and the use of area development agreements are found to be valuable for prospective franchisees. Experience and the number of company-owned and franchised units also attract prospective franchisees. Research limitations/implications – Our findings imply that not all value-creating services and contractual arrangements are interpreted in the same way by prospective franchisees. Franchisors should offer training and financial assistance to new franchisees in the early stages of a franchise. They should also allow sub-franchising but restrict passive ownership and offer the possibility for area development agreements as contractual arrangements to appeal to new franchisees. Franchisors should focus not only on expansion, but should view the chain in a holistic manner by sustaining and growing both franchised and company-owned units. Originality/value – The findings contribute to the franchising literature by providing new evidence on how offering and signaling some contractual arrangements and support services can help franchisors create value for incumbent franchisees and can attract new franchisees. Our research shows that value in franchising is created differently depending on whether the franchisees are incumbent or prospective.

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