Abstracts

Roberto J. Santillán-Salgado from EGADE Business School, Monterrey, Mexico explains in his article “Offshore Financial Centers: Recent Evolution and Likely Future Trends” that the origins of the world-wide distributed Offshore Financial Centers are related to the surge of the Eurocurrency markets during the 1950s and 1960s. After a first stage of rapid expansion, many of those OFCs reached a consolidation stage and remained, even after most of the original drivers for their creation were no longer present. Their insertion as part of the complex mechanisms of the global financial markets is driven by the high skilled financial services as well as the usually benign fiscal treatment the host countries give to multinational institutions established in their territory. As a consequence of the 2007-2009 Financial Crisis, the more advanced nations have formed a new group called the G20, with the aim to improve the coordination of different dimensions of the international economic environment. In its first reunions the G20 have focused in discussing the changes that are needed at the level of the financial architecture and the regulations that apply to international financial markets, with the intention to minimize the probability of another episode of financial crisis in the future. The changes that are likely to follow the G20 initiatives will change the operating conditions and affect the competitive advantages of the OFCs, but will also represent new opportunities for business. This work briefly explores the historical background of the OFCs phenomenon, analyzes its current situation and discusses its likely future trends, based on the OFCs’ most recent environmental changes.Read more Volume 7 no 2

The major purpose of the research work ‘Analyzing the Relationship between Earning Quality and Real and Predicted Profit Deviation in the Listed Companies Tehran Stock Exchange’ by  Razieh Alikhani,  Mehdi Maranjory,  Tahere Aziz Zadeh from Islamic Azad University, Chalous Branch, Iran has been to investigate and analyze the relationship between Earning Quality and Real and Predicted Profit Deviation in the listed Companies in Tehran stock exchange. Therefore, Earning Quality has been considered as an independent variable, and Real and Predicted Profit Deviation as dependent ones. As a measure of Earning Quality this paper uses operating cash flow to operating income. The data collected were examined in sections during the years from 2005 to 2008 for the duration of the study. Results obtained through testing the initial research hypothesis showed that there is no meaningful relation between Earning Quality and Real and Predicted Profit Deviation in all the companies studied. Therefore, while deciding on buying or selling share, investors cannot use the index of earning quality as an index which could predict the profit deviation in order to prevent their investment risks.Read more Volume 7 no 1

Dr Anna Stępniak-Kucharska from Institute of Economics, University of Lodz, Lodz, Poland states in the article ‘The Instruments Of Supporting Entrepreneurs In Times  Of Economic Crisis (Case Study Poland)' that economic crises affect all micro- and macroeconomic areas. Particularly vulnerable to unfavorable changes are enterprises which are often unable to cope with these problems on their own. In this situation, the state helps enterprises with “soft financing”. The systemic anti-crisis measures introduced in Poland over the last 20 years (1990-2010) covered altogether three crises. The crisis which overcame Poland’s economy in the early 1990s was an effect of transformation of the whole socio-economic system. The second crisis took place at the turn of 20^th century and the third in 2009. The first two crises involved state support for enterprises in the form of passive financial restructuring, that is the debt write-off. During the third crisis entirely new measures were adopted, based on liberalized labor law and direct support for enterprises.Read more Volume 7 no 1

The paper 'The corruption trend among public officials in Malaysia: An Overview' by Dr. Noor Sulastry Yurni Ahmad from Department of Anthropology and Sociology Faculty of Arts and Social Sciences University of Malaya Kuala Lumpur, Malaysia,  aims to determine the relationship between economic strain, practices of religion and corruption practices among Malaysian civil service servants. Efforts undertaken to eliminate or curb corruption have failed to achieve total eradication. The rate can be reduced by most legal authorities but it is almost impossible to eliminate them. The study found that those involved and convicted appear to be mostly male officers. Economic strain was found to be associated negatively and significantly with religious strength. This implied that the economic strain influence the increase of corruption ‘crime’ among male officers as compared to women officers is of great important as it may be suggest  the suitability of the Malaysian government or the federal government framework in controlling corruption for the Malaysian community. Unfortunately, the traditional norms and values is fast forgotten and disappearing due to the lack of effort to preserve them. Thus, this paper will try to discuss the issues related to the causes, consequences, scope of corruption and the role of the Malaysian government to fight against corruption among the public officials in Malaysia. Read more Volume 6 no 5&6

Dr Sandeep Kaur from Punjab School of Economics, Guru Nanak Dev University, Amritsar, states in her article ‘India’s Export Potential to Other SAARC Countries: A Gravity Model Analysis’ that India’s export potential to other SAARC nations (Bangladesh, Bhutan, Maldives, Nepal, Pakistan and Sri Lanka) was calculated with the help of gravity model of exports using panel data methodology (pooled model, fixed effect model and random effect model) by taking the time period 1981-2005. To find out the convergence and divergence of India’s exports to SAARC members, speed of convergence was used. Moreover, study has also tried to find whether there is convergence of the actual data towards the estimated equilibrium.  The study reveals that there was presence of convergence in India exports with SAARC countries and in the other words, actual India’s exports to SAARC countries converged towards the estimated export potential. Among SAARC countries, India’s export potential exists for Maldives, Bhutan, Pakistan and Nepal. India is the only SAARC member that shares land border with four members and sea border with two. No other SAARC country shares a common border with each other. In terms of trade, commerce, investments etc., India is a source of potential investment and technology and a major market for products from all other SAARC members. Therefore, it is essentially in India’s interest to put her weight behind SAARC.  Read more Volume 6 no 3 

Dr J K Sachdeva,  Editor, JGE,  Mumbai states in his article 'Indo Japanese Trade Potentials in the context of Bilateral Relations' that India and Japan share a special relationship as fellow democracies seeking greater economic engagement in Asia. The major traded commodities changed from cotton-related products in the early 1900s to heavy machinery in the 1970s.   During the same period heavy industrial products were the major export commodities from Japan besides metal and metal products like iron and steel and steel plates. The 1980s marked the beginning of a new phase in Indo-Japan relations with the establishment of  the Maruti-Suzuki plant. There was a minor set back in relation in 1999 when India went through its nuclear test. In August 2000, however, Japanese Prime Minister Yoshiro Mori made a visit to India that helped propel ties forward. The relations have further been strengthened with the visit of Japanese Prime Minister Yukio Hatoyama in 2009. This paper attempts to analyze imports and exports of commodities and products to and fro these countries to see the effect of bilateral relations on trade, after India initiated trade reforms in 1991. Read more Volume 6 no 3 

Dr. Irina TOBOŞARU and Irina NICOLAU from Christian University “Dimitrie Cantemir”, Bucharest, Romania state in their article  “The Role of Reverse Logistics on The European Market” that the worldwide market analysis suggests that in the year 2008 alone 677 billion dollars have been allocated (for the electronics industry alone) for reverse logistics. Even so, the expenses for reverse logistics are minuscule compared to those for direct logistics in a 12:1 ratio. This status helps to explain the issue of why investments for improving the efficiency and the productivity of the supply chain are often less considered compared to the supply chain within direct logistics. At European level, the legislative framework encompasses a series of directives that refer directly to the electronic and electro technical industries, because these represent a major component of the European economy, being an engine of innovation and new ideas. In the same time, this sector relates greatly to the environment, with the home and office appliances using, for instance, more than 25% of the total final consumption, house lightning representing 17% of the quantity of energy used in homes, with a great part of the energy registering heat losses in a much higher ratio than lightning. Read more Volume 5 no 4

Dr U. Arabi from Mangalore University, Mangalagangothri, Karnataka, ( India) explains in his article “Global Food Prices Trends Behaviour and Managing Food Inflation in India: Strategic Policy Options and Key Issues” that The rapid rise in food prices has been a burden on the poor in developing countries, who spend roughly half of their household incomes on food. There are various factors behind the rapid increase in internationally traded food prices since 2002. The large increase in biofuels production in the U.S. and the EU has recognized as major driver of food prices. Hence, without these increases, global wheat and maize stocks would not have declined appreciably, oilseed prices would not have tripled and droughts would have been more moderate. Recent export bans and speculative activities would probably not have occurred, because they were largely responses to rising prices. This has recently emerged has an important policy issue and Government policies that provide incentives to biofuels production, and biofuels policies which subsidize production has reconsidered in light of their impact on food prices.Read more Volume 5 no 4

Uhomoibhi Toni Aburime from Australia writes in his article ‘Impact Of Political Affiliation On Bank Profitability In Nigeria’ that political affiliation had a positive albeit insignificant impact on bank profitability in Nigeria during the last democratic dispensation (1999-2007). This somewhat contradicts the position of Olufon (1992) and Ogunleye (2003: 27) that some of the successes and problems  of banks in Nigeria can be traced to their political affiliations. Rather, political affiliations have improved bank profitability in Nigeria. Therefore, in order to maximize profitability, managements of banks in Nigeria may wish to consider the political affiliation strategy. In so doing, they may encourage their current and ex-directors to engage in active politics. They may also woo erstwhile influential politicians into their respective boards. Bank shareholders could lend some encouragement in this regard. If successful, the relationships created could be leveraged upon to enhance profitability and, consequently, shareholder value. Finally, the outcome of further research on the impact of political affiliation to the dominant political party (the People’s Democratic Party) on bank profitability in Nigeria would be interesting. To read more click Volume 5 no 3

Dr J. K. Sachdeva states in his article “Impact of World Recession on India’s Growth Perspective-Theories and Facts” that there is a consensus among economists that every economic expansion is followed by recession. During the boom, when economic growth is too fast and unsustainable, inflation increases. To reduce it, the governments deflate the economy by various ways which result into credit crunch and falling prices.  Indian economy also passed through these stages during the year 2008. The economic growth rate, which was above 8% for consecutive period of three years since 2006, suddenly plunged to an average of 5.5%. It needs to validate whether Indian economy has shifted away from consumption and savings to external sector dependence.  The exports of goods have gone to negative in the last quarter of the year 2008-09. However the good sign is services and invisible receipts which have grown 39.96% corresponding to its earlier quarters. To read more click Vol 5 no. 3

Dr Xiuyun Cai from Capital University of Economics and Business (CUEB), China writes in his article 'Choice of the Path of Fiscal and Monetary Policy Coordination in China' states that according to data published by the National Bureau of Statistics, the first quarter of 2009, China's foreign trade declined sharply, the actual use of foreign direct investment declined as well. Compared to China’s 20% of export growth since 2000, export growth declined, the trade surplus decreased and the trade profits reduced. China's investment accounts for high proportion of GDP, while the final consumption, in particular household consumption, accounts for the proportion of low，household consumption expenditure in GDP accounted for more than 50% in "65" and "75", in 2008 it accounted for 35.3%, only the level of 60% to 70% of the half of the other countries. The data indicates that the proportion may continue to fall. April 2009, the overall level of consumer prices fell by 1.5% from the same period last year. From the ring than on, the overall level of consumer prices fell 0.2 percent compared it in March. When the investment, consumption and trading profit fell, the growth of industrial enterprises slowdown SMEs operates difficultly, and corporate profits fell significantly. To read more click Volume 5 no 3

Mr Komol Singha from Royal University of Bhutan, states  in his article ' Bandh Syndrome and its Impact on Trade and Commerce in North-East India' that number of educated unemployed youth of the region is increasing on alarming rate especially in the state of Manipur and Assam. Manipur  has reached 6 lakhs educated unemployed till June 2008 which is approximately 25 per cent of the total population, against the  5.32 lakhs as on 31^st December 2005 and 4.58 lakhs as on 31^st December 2004. On the other hand, Assam has cross 17.61 lakhs as on 31^st December 2005 against 16.32 lakhs as on 31^st December 2004 which is approximately around 6.6 per cent against 12 per cent for North eastern region and 7.7 per cent of all India as per 2001 census.  The main contribution towards the 12 per cent of unemployment rate in North eastern region is because of Manipur. Other states’ contribution is at minimal of 0.44 lakhs from Nagaland, 0.38 lakhs of Meghalaya, 0.34 lakhs of Mizoram and 0.25 lakhs from Arunachal Pradesh. To read more click Vol 5 no. 2

       Prof Sumeet Gupta from ICFAI Business School Jaipur explains in his article 'Valuation of IPO' that there is vast number of opportunities available in the economy for the companies to grow, succeed and diversify their business. Availing of growth opportunities by the company depends on the availability of finance. Starting a new venture, expanding the existing venture or diversifying the existing venture would require the funds. For raising funds, the company has to move in the Capital Market. In Capital Market, Initial Public Offer (IPO) is one of the major methods to raise finance from the public. IPO occurs when the company issues its shares in the Primary Market. IPO help the company in extending liquidity from the market. To read more click Vol 5 no. 2

“Indian Agriculture in the Globalization Era: The Performance and Determinants” by Dr. R. P.  Pradhan from BITS, Pilani, discusses the performance of Indian agriculture during the globalization era of 1990s and its problem thereof. It also examines the determinants of yield per hectare of foodgrains during the 1980s and 1990s. In the first part, the paper observes that agriculture is not cheering in the era of 1990s contrary to other sectors of the economy. The problems associated with this sector is falling growth rate of agricultural GDP. It includes both food and non-food crops and with respect to its area, yield and production. The other related problems of agriculture are declining share of agriculture to overall GDP, diminishing trends of agricultural exports, stagnant and falling public sector investment in agriculture, inadequate irrigation, unbalanced use of inputs, improper adoption of technology, weakness in credit delivery system, slow crop diversification, farmers’ suicide, lack of marketing and low attention to agricultural research. (Read more vol 3 no.1)

Mr. A.V. Manjunatha Research Associate, Dept. of Agricultural l Economics, UAS, G.K.V.K, Bangalore, Prof P.G.Chengappa Professor and Consultant, International Food Policy Research Institute (IFPRI), New Delhi and Pof M.G. Chandrakanth  Dept. of Agril Economics, UAS, G.K.V.K, Bangalore analyze ‘Externalities Due To Sand Mining And Distillery Effluent In Water Streams Of India’ due to failure of markets and institutions, the sand resources all along river streams in general in Karnataka and along the Uttara Pinakini River in Gauribidanur taluk, Kolar district in particular have been subject to severe sand mining. Layers of sand deposits, which are sustaining groundwater through recharge, are threatened due to exponential rise in demand for sand. This is severely reducing groundwater recharge capacities manifest through increased probability of initial and premature failure of irrigation wells and the associated negative effect in farming. In addition to these effects of sand mining, the effect of distillery unit letting its effluents in large lagoons leading to groundwater pollution along Uttara Pinakini River in peninsular India is estimated. To read more click

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R. V. Sujatha et al from WTO Cell, Deaprtment of Agriculture Economics, College of Agriculture, Hyderabd, state in their article “Impact of globalization on Spatial Price Linkages in chillies: Empirical analysis using Cointegration Test” that  India is biggest producer as well as consumer of chillies in the world contributing 25 per cent of the total world production. It is the fifth important foreign exchange earner among Indian spices and contributes Rs. Five crore to the national exchequer. The major chilli producing states are Karnataka, Orissa, Maharastra, West Bengal, Andhra Pradesh and Tamil Nadu. The central focus of the present paper is to address two interrelated issues of chillies – the extent of co-movement of chilli prices in the domestic and world markets and the bearing of WTO measures on the extent of transmission of world prices to the domestic markets. (Read more Vol 3 no.3&4)

Prof Neerav Nagar from St Francis Institute of Management and Research, Mumbai in his article “Drivers of Shareholders’ Value” writes that the most important objective of Financial Management is the maximization of shareholders’ value. After reading this, the first question which comes to our mind is that how do shareholders know that the company to whom they have entrusted their hard earned money is efficiently utilizing it and thus, creating value for them. We have always read the annual reports of the companies to find out information about their ‘top line’ and ‘bottom line’. We also have various financial ratios for our aid like Return on Capital Employed (ROCE), Return on Net Worth (RONW), Earning per Share (EPS), Dividend per Share (DPS) etc. The primary objective of this paper is to find out what drives the shareholders’ value. The study has been conducted to find out the correlation of the measures like ROCE, RONW, EPS, DPS, Cash Flow from Operations and Economic Value Added with Market Value Added (MVA).(Read more Vol 3 no.3&4)