Pub Date : 2020-05-08DOI: 10.1108/jcefts-01-2020-0003
Yongqing Wang
Purpose - It is a common view to Trump administration and public that devaluation of Chinese currency is the origin of the US trade deficit. However, the previous literature does not support this common view. To better understand the causes of the US trade imbalances with China, this study aims to review the previous literature focusing on the causes of bilateral trade imbalances between the USA and China. Design/methodology/approach - Review previous literature according to the different reasons that each paper studies. Findings - Based on the previous literature, the Chinese exchange rate is not the main reason for the US trade imbalances. The official US trade figures overestimate the amount of deficit. The actual causes for the US trade deficit with China perhaps should be the relocation of production to China, low saving in the USA and high saving in China, and the US dollar as the international currency and reserve. Originality/value - By reviewing previous literature, the authors could better understand the puzzle of the US trade deficit with China.
{"title":"Causes of U.S.-China trade imbalances: a review","authors":"Yongqing Wang","doi":"10.1108/jcefts-01-2020-0003","DOIUrl":"https://doi.org/10.1108/jcefts-01-2020-0003","url":null,"abstract":"Purpose - It is a common view to Trump administration and public that devaluation of Chinese currency is the origin of the US trade deficit. However, the previous literature does not support this common view. To better understand the causes of the US trade imbalances with China, this study aims to review the previous literature focusing on the causes of bilateral trade imbalances between the USA and China. Design/methodology/approach - Review previous literature according to the different reasons that each paper studies. Findings - Based on the previous literature, the Chinese exchange rate is not the main reason for the US trade imbalances. The official US trade figures overestimate the amount of deficit. The actual causes for the US trade deficit with China perhaps should be the relocation of production to China, low saving in the USA and high saving in China, and the US dollar as the international currency and reserve. Originality/value - By reviewing previous literature, the authors could better understand the puzzle of the US trade deficit with China.","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":"13 1","pages":"37-44"},"PeriodicalIF":2.4,"publicationDate":"2020-05-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/jcefts-01-2020-0003","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46154789","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2020-04-20DOI: 10.1108/jcefts-07-2019-0035
Syed Tehseen Jawaid, A. Waheed, A. Siddiqui
The purpose of this study is to investigate the first time ever the effects of overall terms of trade, bilateral terms of trade and main commodity groups’ terms of trade on economic growth.,Augmented Dickey Duller and Philips Perron unit root tests and Johensan cointegration test have been applied by using annual time series data from 1974 to 2017. Dynamic ordinary least square and fully modified ordinary least square have also been used to perform sensitivity analysis.,The cointegration test confirm the positive long-run relationship between overall terms of trade (ToT) and economic growth. Country-wise results show that ToT with Australia, Bangladesh, Canada, Hong Kong, Japan, Kuwait, Malaysia, Singapore, Sri Lanka, UK and the USA have significant positive effect on economic growth. Conversely, ToT with China and UAE has significant negative effect on economic growth. In contrast, ToT with India, Norway, Saudi Arabia and Switzerland has insignificant effect on the economic growth of Pakistan. Product-wise results indicate that the product group namely, Chemical, Crude Material inedible except fuels, Manufactured and Minerals fuels and Lubricant found to be a significant positive effect on economic growth. However, Beverages and Tobacco, and Machinery and Transport product groups found to be significant negative impact on economic, while Food and Live animals found to be insignificant.,In general, it is suggested that the beneficial terms of trade are favorable for economic growth. The study suggested export promotion policy for which relationship between ToT and economic growth found positive and import substitution policy is suggested the products found a negative relationship between the said variables.,This paper is a pioneer attempt to investigate the effect of overall ToT, bilateral terms of trade and the main commodity group’s ToT on economic growth in Pakistan.
{"title":"Terms of trade and economic growth in developing country","authors":"Syed Tehseen Jawaid, A. Waheed, A. Siddiqui","doi":"10.1108/jcefts-07-2019-0035","DOIUrl":"https://doi.org/10.1108/jcefts-07-2019-0035","url":null,"abstract":"The purpose of this study is to investigate the first time ever the effects of overall terms of trade, bilateral terms of trade and main commodity groups’ terms of trade on economic growth.,Augmented Dickey Duller and Philips Perron unit root tests and Johensan cointegration test have been applied by using annual time series data from 1974 to 2017. Dynamic ordinary least square and fully modified ordinary least square have also been used to perform sensitivity analysis.,The cointegration test confirm the positive long-run relationship between overall terms of trade (ToT) and economic growth. Country-wise results show that ToT with Australia, Bangladesh, Canada, Hong Kong, Japan, Kuwait, Malaysia, Singapore, Sri Lanka, UK and the USA have significant positive effect on economic growth. Conversely, ToT with China and UAE has significant negative effect on economic growth. In contrast, ToT with India, Norway, Saudi Arabia and Switzerland has insignificant effect on the economic growth of Pakistan. Product-wise results indicate that the product group namely, Chemical, Crude Material inedible except fuels, Manufactured and Minerals fuels and Lubricant found to be a significant positive effect on economic growth. However, Beverages and Tobacco, and Machinery and Transport product groups found to be significant negative impact on economic, while Food and Live animals found to be insignificant.,In general, it is suggested that the beneficial terms of trade are favorable for economic growth. The study suggested export promotion policy for which relationship between ToT and economic growth found positive and import substitution policy is suggested the products found a negative relationship between the said variables.,This paper is a pioneer attempt to investigate the effect of overall ToT, bilateral terms of trade and the main commodity group’s ToT on economic growth in Pakistan.","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":"13 1","pages":"1-19"},"PeriodicalIF":2.4,"publicationDate":"2020-04-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/jcefts-07-2019-0035","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43691032","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-07DOI: 10.1108/jcefts-06-2019-0033
Bismark Appiah, Donghui Zhang, S. Majumder
Purpose The purpose of the current study is to analyze the influence that is caused by ethnicity and volunteer self-employment in entrepreneurship on the initial financing and business performance of Chinese enterprises. The increasing trend of entrepreneurship has raised certain ethnic challenges in entrepreneurship owing to globalization and now there are several minority groups that are running their households in China. So, the current study aims to assess whether the minority-operated and majority-operated firms have different access to initial financing and different business performance. Design/methodology/approach The data are collected from 25 Chinese enterprises about the current variables, and the relationships are tested. This study has used the ordinary least of square (OLS) regression model to examine the findings. Findings The purposive sampling is used in the current study because the purpose of the present research is to understand and study the role of ethnicity and self-employment in initial financing and business performance of Chinese enterprises and so the data was collected from related enterprises. This study has used the ordinary least of square (OLS) regression model to examine the findings. Originality/value The current findings have significant implications in theory and practice. This study will be a great addition to the literature because the self-employment has never been examined before in such models to assess the role of forceful or volunteer self-employment in entrepreneurship, and so, it will open new doors of research for future researchers.
{"title":"Impact of ethnicity and self-employment on initial financing and business performance in entrepreneurship in China","authors":"Bismark Appiah, Donghui Zhang, S. Majumder","doi":"10.1108/jcefts-06-2019-0033","DOIUrl":"https://doi.org/10.1108/jcefts-06-2019-0033","url":null,"abstract":"\u0000Purpose\u0000The purpose of the current study is to analyze the influence that is caused by ethnicity and volunteer self-employment in entrepreneurship on the initial financing and business performance of Chinese enterprises. The increasing trend of entrepreneurship has raised certain ethnic challenges in entrepreneurship owing to globalization and now there are several minority groups that are running their households in China. So, the current study aims to assess whether the minority-operated and majority-operated firms have different access to initial financing and different business performance.\u0000\u0000\u0000Design/methodology/approach\u0000The data are collected from 25 Chinese enterprises about the current variables, and the relationships are tested. This study has used the ordinary least of square (OLS) regression model to examine the findings.\u0000\u0000\u0000Findings\u0000The purposive sampling is used in the current study because the purpose of the present research is to understand and study the role of ethnicity and self-employment in initial financing and business performance of Chinese enterprises and so the data was collected from related enterprises. This study has used the ordinary least of square (OLS) regression model to examine the findings.\u0000\u0000\u0000Originality/value\u0000The current findings have significant implications in theory and practice. This study will be a great addition to the literature because the self-employment has never been examined before in such models to assess the role of forceful or volunteer self-employment in entrepreneurship, and so, it will open new doors of research for future researchers.\u0000","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":" ","pages":""},"PeriodicalIF":2.4,"publicationDate":"2019-10-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/jcefts-06-2019-0033","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45343010","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-07DOI: 10.1108/jcefts-07-2019-0041
Fuzhong Chen, Guo-liang Jiang, Wenting Wang
Purpose Improvements in the facilitation of foreign direct investment (FDI) through institutional quality play a significant role in the establishment of an open economy. However, the impact of institutional quality on the facilitation of FDI along the Belt and Road countries is not well explored. This study aims to empirically investigate the influence of institutional quality on the degree of FDI facilitation and explore the impact mechanism using national-level panel data from countries along the Belt and Road. Design/methodology/approach For the data set, all variables have been normalized, and principal component analysis has been used. For the empirical models, robust standard errors and dynamic GMM method have been used to alleviate heteroscedasticity and endogeneity. Findings The empirical results indicate that institutional quality has a significantly positive effect on the degree of FDI facilitation. Furthermore, the impact mechanism involves the mediating mechanism. In other words, the effect of institutional quality that promotes FDI facilitation is influenced by factors such as laws and regulations. In addition, the implementation of the Belt and Road Initiative (BRI) has significantly enhanced the promotional effect of institutional quality on the facilitation of FDI. Practical implications Policymakers should focus on improving the institutional quality and the influence of mediating mechanisms, such as policies and regulations, in the institutional environment. Originality/value This study contributes to extant literature on the impact of institutional quality on FDI facilitation of significance to China, the BRI countries, and other countries to facilitate openness in international investment. This study also contributes to the extant literature on the influence of the BRI on the development of BRI countries. This will inform policy makers, investment institutions and enterprises about the development of effective policies to aid the development of BRI countries and improve the efficiency and the returns on FDI.
{"title":"Institutional quality and its impact on the facilitation of foreign direct investment","authors":"Fuzhong Chen, Guo-liang Jiang, Wenting Wang","doi":"10.1108/jcefts-07-2019-0041","DOIUrl":"https://doi.org/10.1108/jcefts-07-2019-0041","url":null,"abstract":"\u0000Purpose\u0000Improvements in the facilitation of foreign direct investment (FDI) through institutional quality play a significant role in the establishment of an open economy. However, the impact of institutional quality on the facilitation of FDI along the Belt and Road countries is not well explored. This study aims to empirically investigate the influence of institutional quality on the degree of FDI facilitation and explore the impact mechanism using national-level panel data from countries along the Belt and Road.\u0000\u0000\u0000Design/methodology/approach\u0000For the data set, all variables have been normalized, and principal component analysis has been used. For the empirical models, robust standard errors and dynamic GMM method have been used to alleviate heteroscedasticity and endogeneity.\u0000\u0000\u0000Findings\u0000The empirical results indicate that institutional quality has a significantly positive effect on the degree of FDI facilitation. Furthermore, the impact mechanism involves the mediating mechanism. In other words, the effect of institutional quality that promotes FDI facilitation is influenced by factors such as laws and regulations. In addition, the implementation of the Belt and Road Initiative (BRI) has significantly enhanced the promotional effect of institutional quality on the facilitation of FDI.\u0000\u0000\u0000Practical implications\u0000Policymakers should focus on improving the institutional quality and the influence of mediating mechanisms, such as policies and regulations, in the institutional environment.\u0000\u0000\u0000Originality/value\u0000This study contributes to extant literature on the impact of institutional quality on FDI facilitation of significance to China, the BRI countries, and other countries to facilitate openness in international investment. This study also contributes to the extant literature on the influence of the BRI on the development of BRI countries. This will inform policy makers, investment institutions and enterprises about the development of effective policies to aid the development of BRI countries and improve the efficiency and the returns on FDI.\u0000","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":" ","pages":""},"PeriodicalIF":2.4,"publicationDate":"2019-10-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/jcefts-07-2019-0041","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44054662","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-10-07DOI: 10.1108/jcefts-04-2019-0020
O. Bhatti, A. Hanjra
Purpose This paper aims to attempt to investigate if the now-existing upstream Sost Dry Port in Gilgit-Baltistan and the prospective midstream Havelian Dry Port in Khyber Pakhtunkhwa, both part of One Belt One Road (OBOR), are expected to compete against or complement each other in terms of port efficiency and location, and which of the two ports should first be developed in the wake of uninterrupted logistics flow of cargo on the Economic Corridor. Design/methodology/approach Analytic hierarchy process (AHP) has been used for multi-criteria decision making by the stakeholders. Five main criteria for transhipment port selection, ranging from port location, port efficiency, intermodal connectivity, port costs and cargo volume were used with three sub-criteria each. Findings This study demonstrates the results that favour physical infrastructural development initiatives prioritized for the Sost Dry Port in view of its strategic location as the upstream supply chain node on the Economic Corridor, imparting efficiency to the logistics flow. Practical implications Results of this study may assist policymakers in achieving goals like enhancing trade facilitation, reducing congestion and increasing cargo security on OBOR. Originality/value To the best of the authors’ knowledge, this is the first study of its kind that analyzes priority for immediate development intervention for either Sost or Havelian Dry Port, both located on CPEC – OBOR supply chain.
{"title":"Development prioritization through analytical hierarchy process (AHP) - decision making for port selection on the one belt one road","authors":"O. Bhatti, A. Hanjra","doi":"10.1108/jcefts-04-2019-0020","DOIUrl":"https://doi.org/10.1108/jcefts-04-2019-0020","url":null,"abstract":"\u0000Purpose\u0000This paper aims to attempt to investigate if the now-existing upstream Sost Dry Port in Gilgit-Baltistan and the prospective midstream Havelian Dry Port in Khyber Pakhtunkhwa, both part of One Belt One Road (OBOR), are expected to compete against or complement each other in terms of port efficiency and location, and which of the two ports should first be developed in the wake of uninterrupted logistics flow of cargo on the Economic Corridor.\u0000\u0000\u0000Design/methodology/approach\u0000Analytic hierarchy process (AHP) has been used for multi-criteria decision making by the stakeholders. Five main criteria for transhipment port selection, ranging from port location, port efficiency, intermodal connectivity, port costs and cargo volume were used with three sub-criteria each.\u0000\u0000\u0000Findings\u0000This study demonstrates the results that favour physical infrastructural development initiatives prioritized for the Sost Dry Port in view of its strategic location as the upstream supply chain node on the Economic Corridor, imparting efficiency to the logistics flow.\u0000\u0000\u0000Practical implications\u0000Results of this study may assist policymakers in achieving goals like enhancing trade facilitation, reducing congestion and increasing cargo security on OBOR.\u0000\u0000\u0000Originality/value\u0000To the best of the authors’ knowledge, this is the first study of its kind that analyzes priority for immediate development intervention for either Sost or Havelian Dry Port, both located on CPEC – OBOR supply chain.\u0000","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":" ","pages":""},"PeriodicalIF":2.4,"publicationDate":"2019-10-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/jcefts-04-2019-0020","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44373901","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-21DOI: 10.1108/JCEFTS-01-2019-0001
M. Tahir, T. Mazhar, M. A. Afridi
Purpose The trade–growth nexus has been researched during the past few decades. However, the impact of trade openness on different sectors of the economy is not well explored. The purpose of the current study is to focus on developing countries to examine the impact of trade openness on three main sectors: industrial, service and agricultural. Design/methodology/approach The study applied econometric techniques that control unobserved heterogeneity and endogeneity to obtain robust and reliable results. Findings The results revealed that trade openness impacts different sectors differently. Trade openness positively impacts agriculture and industrial sectors, whereas it negatively affects the service sector. A similar trend is observed with regard to employment as it affects service sector negatively and creates a positive impact on other sectors, namely, agriculture and industrial sectors. Furthermore, it was found that human capital has a negative effect on all sectors, whereas financial development has positive effects on service and industrial sectors and negative effect on agriculture sector. The results are robust because of the method of estimation and the addition of some relevant variables. Practical implications The policymakers should focus on trade in agricultural and industrial sectors and should discourage trade in the service sector. Originality/value This study has examined the impact of trade openness on sectoral growth by focusing on the developing world, which is an under-researched area in the literature.
{"title":"Trade openness and sectoral growth in developing countries: some new insights","authors":"M. Tahir, T. Mazhar, M. A. Afridi","doi":"10.1108/JCEFTS-01-2019-0001","DOIUrl":"https://doi.org/10.1108/JCEFTS-01-2019-0001","url":null,"abstract":"\u0000Purpose\u0000The trade–growth nexus has been researched during the past few decades. However, the impact of trade openness on different sectors of the economy is not well explored. The purpose of the current study is to focus on developing countries to examine the impact of trade openness on three main sectors: industrial, service and agricultural.\u0000\u0000\u0000Design/methodology/approach\u0000The study applied econometric techniques that control unobserved heterogeneity and endogeneity to obtain robust and reliable results.\u0000\u0000\u0000Findings\u0000The results revealed that trade openness impacts different sectors differently. Trade openness positively impacts agriculture and industrial sectors, whereas it negatively affects the service sector. A similar trend is observed with regard to employment as it affects service sector negatively and creates a positive impact on other sectors, namely, agriculture and industrial sectors. Furthermore, it was found that human capital has a negative effect on all sectors, whereas financial development has positive effects on service and industrial sectors and negative effect on agriculture sector. The results are robust because of the method of estimation and the addition of some relevant variables.\u0000\u0000\u0000Practical implications\u0000The policymakers should focus on trade in agricultural and industrial sectors and should discourage trade in the service sector.\u0000\u0000\u0000Originality/value\u0000This study has examined the impact of trade openness on sectoral growth by focusing on the developing world, which is an under-researched area in the literature.\u0000","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":"1 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2019-06-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/JCEFTS-01-2019-0001","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42912199","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-03DOI: 10.1108/JCEFTS-01-2019-0007
M. Draz, Fayyaz Ahmad, B. Gupta, Waqas Amin
Purpose This study aims to examine the impact of macroeconomic fundamentals on exchange rates of selected South Asian economies during 1981-2013. Design/methodology/approach The authors have used two econometric approaches to the data. For the pooled sample, estimated generalized least square (EGLS) and the two-stage least square method are applied. For the panel data, the authors have used the panel generalized method of moments and ordinary least squares (OLS) methods. Findings The results suggest that macroeconomic factors have a significant impact on exchange rates. The robust findings highlight that improvements in domestic economic and political systems are crucial for a successful exchange rate policy. Originality/value The existing literature on exchange rate fundamentals have either focused on exchange rates and international trade or investigated the relationship for the developed economies. Covering a period of more than three decades, and using both pooled and panel estimations, our study is unique in terms of its focus on the South Asian economies.
{"title":"Macroeconomic fundamentals and exchange rates in South Asian economies","authors":"M. Draz, Fayyaz Ahmad, B. Gupta, Waqas Amin","doi":"10.1108/JCEFTS-01-2019-0007","DOIUrl":"https://doi.org/10.1108/JCEFTS-01-2019-0007","url":null,"abstract":"\u0000Purpose\u0000This study aims to examine the impact of macroeconomic fundamentals on exchange rates of selected South Asian economies during 1981-2013.\u0000\u0000\u0000Design/methodology/approach\u0000The authors have used two econometric approaches to the data. For the pooled sample, estimated generalized least square (EGLS) and the two-stage least square method are applied. For the panel data, the authors have used the panel generalized method of moments and ordinary least squares (OLS) methods.\u0000\u0000\u0000Findings\u0000The results suggest that macroeconomic factors have a significant impact on exchange rates. The robust findings highlight that improvements in domestic economic and political systems are crucial for a successful exchange rate policy.\u0000\u0000\u0000Originality/value\u0000The existing literature on exchange rate fundamentals have either focused on exchange rates and international trade or investigated the relationship for the developed economies. Covering a period of more than three decades, and using both pooled and panel estimations, our study is unique in terms of its focus on the South Asian economies.\u0000","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":" ","pages":""},"PeriodicalIF":2.4,"publicationDate":"2019-06-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/JCEFTS-01-2019-0007","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44067354","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-06-03DOI: 10.1108/jcefts-11-2018-0042
Teddy Chandra, A. Junaedi, E. Wijaya, S. Suharti, Irman Mimelientesa, Martha Ng
PurposeThe purpose of this study is to examine the factors that influence capital structure, profitability and stock returns and the relationship between capital structure, profitability and stock returns. The endogenous variables in this study are capital structure, profitability and stock returns, whereas the exogenous variables are firm size, growth opportunity, tangibility, liquidity, volatility and uniqueness.Design/methodology/approachThe population used is a company that is listed on the compass index 100 period of August 2016. A total of 64 companies are sampled in this study. The unit of analysis is 448 data. The data analysis technique used is path analysis with the help of AMOS.FindingsThe results obtained show only profitability variables that affect stock returns. Variable capital structure, firm size, growth opportunity, tangibility and liquidity have no significant effect. Variables that influence capital structure are only influenced by growth opportunity, whereas other variables are not significant and variables that affect profitability are firm size, growth opportunity, uniqueness and volatility.Originality/valuePath analysis is a model similar to the multiple regression analysis, factor analysis, canonical correlation analysis, discriminant analysis and more general multivariate analysis groups. This research discusses that capital structure is useful for increasing the value of the company in the sense that the more debt that is used, a tax deduction will be obtained because of interest costs. So that the company’s profits will increase and eventually will increase the value of the company. This opinion remains a controversy among financial experts. Until now, there is no agreement that can explain the capital structure in all conditions of the company. There are two important theories concerning capital structure, trade-off theory and pecking order theory.
{"title":"The effect of capital structure on profitability and stock returns","authors":"Teddy Chandra, A. Junaedi, E. Wijaya, S. Suharti, Irman Mimelientesa, Martha Ng","doi":"10.1108/jcefts-11-2018-0042","DOIUrl":"https://doi.org/10.1108/jcefts-11-2018-0042","url":null,"abstract":"PurposeThe purpose of this study is to examine the factors that influence capital structure, profitability and stock returns and the relationship between capital structure, profitability and stock returns. The endogenous variables in this study are capital structure, profitability and stock returns, whereas the exogenous variables are firm size, growth opportunity, tangibility, liquidity, volatility and uniqueness.Design/methodology/approachThe population used is a company that is listed on the compass index 100 period of August 2016. A total of 64 companies are sampled in this study. The unit of analysis is 448 data. The data analysis technique used is path analysis with the help of AMOS.FindingsThe results obtained show only profitability variables that affect stock returns. Variable capital structure, firm size, growth opportunity, tangibility and liquidity have no significant effect. Variables that influence capital structure are only influenced by growth opportunity, whereas other variables are not significant and variables that affect profitability are firm size, growth opportunity, uniqueness and volatility.Originality/valuePath analysis is a model similar to the multiple regression analysis, factor analysis, canonical correlation analysis, discriminant analysis and more general multivariate analysis groups. This research discusses that capital structure is useful for increasing the value of the company in the sense that the more debt that is used, a tax deduction will be obtained because of interest costs. So that the company’s profits will increase and eventually will increase the value of the company. This opinion remains a controversy among financial experts. Until now, there is no agreement that can explain the capital structure in all conditions of the company. There are two important theories concerning capital structure, trade-off theory and pecking order theory.","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":" ","pages":""},"PeriodicalIF":2.4,"publicationDate":"2019-06-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/jcefts-11-2018-0042","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48448132","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-02-04DOI: 10.1108/JCEFTS-07-2018-0025
Patrick F. Larue
Purpose The purpose of this paper is to understand the reasons why individuals in Sub-Saharan African countries may be more supportive or more opposed to rising foreign direct investment (FDI) from China. As Chinese FDI continues to increase throughout Africa, African populations are consistently found to be supportive, sceptical or at time hostile. Previous literature has shown that the attitudes of individuals towards different classes of rights protections is a significant predictor of individual attitudes. This paper explores this question in greater detail, providing academics and policymakers insight into how individual attitudes are derived. Design/methodology/approach This paper uses large-N statistical methods (ordered logit regression) aimed at accurately unpacking the relationship between individuals affinity towards rights protections and attitudes towards Chinese FDI. The paper uses over 40,000 responses from 36 countries to explain this relationship, where updated survey questions more accurately address the key questions of interest. Findings Based on updated survey data, the results of this paper show that an individual’s affinity for a particular class of rights protection is not a significant predictor of attitudes towards Chinese FDI. Originality/value The value of this paper is in its contradiction to the previous literature. While others have examined this very question, academics have been limited due to the marginally relevant questions found in survey instruments. With updated questions in the newest round of Afrobarometer surveys that are more appropriate given this specific research question, this paper provides a new conclusion to a question that is only becoming more pressing in today's global economic climate.
{"title":"The determinants of Sub-Saharan African attitudes towards Chinese FDI","authors":"Patrick F. Larue","doi":"10.1108/JCEFTS-07-2018-0025","DOIUrl":"https://doi.org/10.1108/JCEFTS-07-2018-0025","url":null,"abstract":"\u0000Purpose\u0000The purpose of this paper is to understand the reasons why individuals in Sub-Saharan African countries may be more supportive or more opposed to rising foreign direct investment (FDI) from China. As Chinese FDI continues to increase throughout Africa, African populations are consistently found to be supportive, sceptical or at time hostile. Previous literature has shown that the attitudes of individuals towards different classes of rights protections is a significant predictor of individual attitudes. This paper explores this question in greater detail, providing academics and policymakers insight into how individual attitudes are derived.\u0000\u0000\u0000Design/methodology/approach\u0000This paper uses large-N statistical methods (ordered logit regression) aimed at accurately unpacking the relationship between individuals affinity towards rights protections and attitudes towards Chinese FDI. The paper uses over 40,000 responses from 36 countries to explain this relationship, where updated survey questions more accurately address the key questions of interest.\u0000\u0000\u0000Findings\u0000Based on updated survey data, the results of this paper show that an individual’s affinity for a particular class of rights protection is not a significant predictor of attitudes towards Chinese FDI.\u0000\u0000\u0000Originality/value\u0000The value of this paper is in its contradiction to the previous literature. While others have examined this very question, academics have been limited due to the marginally relevant questions found in survey instruments. With updated questions in the newest round of Afrobarometer surveys that are more appropriate given this specific research question, this paper provides a new conclusion to a question that is only becoming more pressing in today's global economic climate.\u0000","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":" ","pages":""},"PeriodicalIF":2.4,"publicationDate":"2019-02-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/JCEFTS-07-2018-0025","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43948807","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-02-04DOI: 10.1108/JCEFTS-06-2018-0018
Rania S. Miniesy Dr., M. Tarek
PurposeThis paper aims to test the pollution haven hypothesis (PHH) in developing Asian countries by examining whether lax environmental laws are a determinant of foreign direct investment (FDI) inflows into these countries, which are characterised by being the largest FDI recipients among developing countries and also by being among the most highly polluted and the highest carbon dioxide (CO2) emitters worldwide.Design/methodology/approachPanel data for the main determinants of FDI inflows including a carbon dioxide emissions and an agglomeration variable are collected for all developing Asian countries for the 1996-2016 period and a fixed effects model with robust standard errors is used.FindingsResults show that lax environmental laws are a significant determinant of FDI inflows for the selected Asian countries as a whole. A closer look shows that this result cannot be generalised for the whole region, but applies particularly to three countries China, Hong Kong and the Philippines. PHH is thus only partially supported.Originality/valueFDI is a main engine of growth for developing countries. However, it might adversely affect them, specifically in terms of environmental deterioration in the absence of stringent and well-enforced environmental policies. Some developing countries might even deliberately relax their environmental policies to attain comparative advantage especially in polluting industries and thus attract FDI. This leads to serious repercussions and might eventually limit growth, where augmenting it was the intention in the first place.
{"title":"Is there evidence of PHH in developing Asia?","authors":"Rania S. Miniesy Dr., M. Tarek","doi":"10.1108/JCEFTS-06-2018-0018","DOIUrl":"https://doi.org/10.1108/JCEFTS-06-2018-0018","url":null,"abstract":"PurposeThis paper aims to test the pollution haven hypothesis (PHH) in developing Asian countries by examining whether lax environmental laws are a determinant of foreign direct investment (FDI) inflows into these countries, which are characterised by being the largest FDI recipients among developing countries and also by being among the most highly polluted and the highest carbon dioxide (CO2) emitters worldwide.Design/methodology/approachPanel data for the main determinants of FDI inflows including a carbon dioxide emissions and an agglomeration variable are collected for all developing Asian countries for the 1996-2016 period and a fixed effects model with robust standard errors is used.FindingsResults show that lax environmental laws are a significant determinant of FDI inflows for the selected Asian countries as a whole. A closer look shows that this result cannot be generalised for the whole region, but applies particularly to three countries China, Hong Kong and the Philippines. PHH is thus only partially supported.Originality/valueFDI is a main engine of growth for developing countries. However, it might adversely affect them, specifically in terms of environmental deterioration in the absence of stringent and well-enforced environmental policies. Some developing countries might even deliberately relax their environmental policies to attain comparative advantage especially in polluting industries and thus attract FDI. This leads to serious repercussions and might eventually limit growth, where augmenting it was the intention in the first place.","PeriodicalId":44245,"journal":{"name":"Journal of Chinese Economic and Foreign Trade Studies","volume":" ","pages":""},"PeriodicalIF":2.4,"publicationDate":"2019-02-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1108/JCEFTS-06-2018-0018","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49041944","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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