Contemporary Issues in Business Economics and Finance: Volume 104

Introduction – The rapid flow of information between the markets eliminates the possibility of diversifying the portfolio by bringing the markets closer, and may cause the volatility in a market to spread to another market. In this context, revealing the relationships between conventional and participation markets or financial assets is important in terms of portfolio diversification and risk management.

Purpose – The major aim of this work is to analyse the existence of volatility spillover between conventional stock index and participation index based on the indexes in Turkish Capital Markets. BIST-30 and Katılım-30 indexes are used as the representatives of conventional stock index and participation index, respectively.

Methodology – Firstly, the univariate HYGARCH (1,d,1) parameters are calculated, and secondly, the dynamic equicorrelation (DECO) methodology is applied. DECO model is proposed to simplify structural assumptions by introducing a structure in which all twosomes of returns take the same correlation for a given time period. In this way, DECO model enables to have an optimal portfolio selection in comparison to an unrestricted time varying-dynamic correlation approaches and gives more advanced forecasting ability for the duration of the financial crisis periods compared to the various portfolios.

Findings – There is a strong correlation between BIST-30 and Katılım-30. They are affected by the same shocks. We expect to see different investor behaviours for Katılım-30 and BIST-30. However, they seem to have almost the same investor profile. In addition, there is a causality in both ways and volatility spillover between them.

Introduction – The Romanian industry was one of the most important traditional branches and in the context of the integration of the country into the European Union, the Romanian industry has made progress in the development of several types of industrial branches, attracting in this sector investors with foreign capital that have determined economic growth by branch having a major impact on the achievement of gross domestic product. The progress and sustainable development of a country is interdependent on both macroeconomic and microeconomic development, and the development of a branch of the economy leads to the creation of a stable environment for attracting new investors and implicitly to the upward evolution of the economy by branch.

Purpose – This article identifies models of bankruptcy risk analysis that have as variables relevant performance indicators for examining the bankruptcy risk of Romanian industrial companies so that it is verified how predictable and significant it is to avoid their potential bankruptcy.

Methodology – By using performance indicators such as liquidity, profitability and insolvency, the analysis aims to be a benchmark for the Romanian industrial companies’ research in terms of bankruptcy risk, but also the accuracy of the models chosen to diagnose a potential bankruptcy.

Findings – There was highlighted a strong relationship between the economic and financial indicators and the Z score functions.

Introduction – Female employment and policies are an important aspect of growth and development. Inadequate utilisation of female labour force within the national economy reflects in economic and social indicators especially in developing countries. Women’s self-development, active participation in labour markets, and social and economic opportunities are the main factors in the development of countries. This study attempts to research the effects of female work force participation in the member countries of the Organisation of Islamic Cooperation (OIC) on economic growth in time period between 2004 and 2016. The countries were selected among the countries that have high and middle human development index according to Human Development Report in 2017.

Purpose – In this chapter, it is aimed to support the employment of female labour force and to show its share in development and growth in the member countries of the OIC. The aspect differs from similar studies to address the issue in term of Islamic countries.

Methodology – While analysing the impact of female employment on growth, the panel data analysis method and fixed and random effect model were used.

Findings – It has been found that female employment has a positive impact on economic growth for the selected OIC countries.

Introduction – Increases in prices of commodity markets may be associated with increased volatility in financial markets. That is why analysing time-varying co-movements of commodity prices can be of great importance for investors who take into consideration optimal asset allocation.

Purpose – The aim of this study is to investigate the volatility spillover from oil to precious metals under high-volatility and low-volatility regimes.

Methodology – The data covered daily closing prices of assets such as oil, palladium, and platinum for the period January 2010–December 2018. GARCH models were analysed in order to determine the most appropriate volatility structure, and it was determined that GARCH (1,1) model was the most suitable model for all commodities. Markov Switching model was used to analyse the volatility spillover from oil to precious metals.

Findings – According to the analyses, the results showed that there were volatility spillovers from oil to palladium and platinum in low-volatility regimes and from oil to platinum in high-volatility regimes. On the other hand, there was no volatility spillover from oil to palladium in high-volatility regimes. Investing into oil and palladium in the same portfolio can provide diversification benefits for investors in high-volatility regimes. On the other hand, investing into oil and palladium in the same portfolio may not provide diversification benefits for investors in low-volatility regimes. The findings of the analyses can be beneficial for investors, market participants, and portfolio managers to make an accurate portfolio management.

The present study aims to reveal knowledge, report on perception level and look at the evaluation of exchange rate risk management techniques of enterprises registered to Afyonkarahisar Chamber of Commerce and Industry. In order to achieve this, the authors conducted a study that included a field-survey and consisted of 223 enterprises that have foreign trade transactions in Afyonkarahisar city. The data that were used in the analysis had been collected via a survey and they were statistically evaluated by SPSS program.

Within the scope of the study, the authors investigated the determination of corporational identity of the sampled manufacturing enterprises, organisational structure of finance departments, determination of ownership structures of these enterprises, determination of foreign exchange risk perceptions, classification of exchange rate risks according to industry type and the determination of risk management instruments such as internal and external hedging strategies and information and usage levels of derivative instruments.

The most important result obtained in the study is that the majority of the companies, which operate in a competitive environment, are intensely exposed to foreign exchange risk but try to overcome the foreign exchange risk using traditional internal firm-level hedging methods instead of well-reputed external hedging methods or derivative instruments. Firms declared to be out of knowledge – by any means – for derivative instruments as the main reason for not utilising a well-reputed external foreign exchange risk management techniques.

Introduction – The banking sector is one of the most important building blocks of the financial system. A failure in the banking sector can cause serious problems in a country’s economy. In order for countries to achieve economic growth and development goals, the banking sector, which affects all sectors significantly, needs to be strong. Countries with a robust and reliable banking system have a high credit rating. As a result of this high credit rating, the interest of foreign capital in the country increases. Thus, the credit volume of banks expands and loans are provided at a more appropriate rate for investments. In this respect, the performance and profitability of banks are important. The CAMELS performance model is a valuation system used to determine the general status of banks. The CAMELS model consists of six components. According to this, C represents capital adequacy; A, asset quality; M, management adequacy; E, earnings; L, liquidity; and S, sensitivity to market risks.

Purpose – The purpose of this study is to demonstrate the effect of the CAMLS variables on the variable E.

Methodology – In the implementation part of the study, the data of 11 banks in the BIST Bank Index between 2004 and 2018 were used. In the analysis part of the study, a panel data analysis method was used.

Findings – The capital adequacy (C), management adequacy (M) and liquidity (L) variables were effective on profitability. This study revealed the importance of the capital, management and liquidity variables, which are internal factors, in increasing the profitability of banks.

Introduction – Today, just like the goods and services, cities may provide a context for marketing activities. In this way, through the right marketing strategies and activities, cities can turn into brands, as well. Starting from this fact, it can be readily thought that cities can also be experienced as well as goods and/or services and some behaviours such as satisfaction and positive word of mouth can emerge, as a result of the experience.

Purpose – In this sense, the authors attempted to examine the interplay between experience, satisfaction and positive word of mouth within the context of city marketing.

Methodology – The authors designed the study as a causal research. The sample of the study was reached through convenience sampling method. Data were collected via survey method. The data compiled for the study were analysed with Model 4 in Hayes Macro Process Models.

Findings – The findings of the study displayed an interaction between experience, satisfaction and positive word of mouth regarding a city. Additionally, it presented the mediator role of satisfaction on the relationship between experience and positive word of mouth. In this respect, it is thought that by emphasising the importance of experience regarding the city and showing the importance of measuring satisfaction level of visitors, the findings of the study are expected to contribute to the activities of local governments which want to promote their cities.

Introduction – In the twenty-first century, which is the age of communication and information, the time and space concepts have changed with new media technologies and changes have occurred in habits and ways of doing business using the Internet. In this respect, crowdsourcing concept comes first among the new applications with which internet users can share content. The crowdsourcing, which may be understood as ‘mass-based work’ or ‘crowded resource’, consists of a combination of ‘crowd’ and ‘source’, and refers to the use of a great number of human societies to do a common work. The crowdsourcing concept, used commonly as of the 2000s for different purposes, is included in the literature as a concept showing the power of crowds. It is a method in which communication and internet technologies are used with efficacy in the advertising and marketing fields.

Purpose – The objective of the present study is to determine the pros and cons of the crowdsourcing concept through new media applications in the form of critical evaluations by examining sample case studies that use the crowdsourcing concept, which is becoming widespread in Turkey and in the whole world in recent years.

Methodology – In this study, the ‘Case (Sample Event) Study Analysis’, which is one of the qualitative research methods and which is a methodological approach that includes examining how the crowdsourcing system works in-depth, will be used.

Findings – Crowdsourcing is becoming a worldwide business model and allows anyone with free time and an internet connection to contribute to economic productivity. This study has discussed the importance of crowdsourcing for companies in contextual terms and has made predictions on how to make this concept become a better model in which fields.

Introduction: – Together with the increasing competition between businesses each day, the sales and marketing process of products and services have become increasingly difficult. For this reason, sales have become a marketing activity with an ever-growing importance to businesses. The performance of salespeople who undertake this challenge on behalf of the business is highly valuable for firms. Many researches have noted that there is a relationship between the performance of salesperson and motivation. The purpose of motivation in sales literature is to direct salespeople to exert more effort in reaching sales-oriented goals and aims. In order to ensure this, many businesses use various motivation tools/factors.

Purpose – The aim of this study is to analyse the effect of motivation factors on performance of salesperson.

Methodology – Quantitative research method was used in the study. A questionnaire was prepared with this aim in mind and administered to 315 employees working as salesperson in Çanakkale and Bursa provinces.

Findings – The findings from the analysis of the data show that the five dimensions namely satisfaction, image, relations, knowledge of product and service and advertisement related to motivation factors have a significant effect on the task performance of the salesperson.

Introduction – The most basic rule of job search is job search behaviour. Job search behaviour is defined as the effort of the individual, time spent on various activities in order to find a job. In the current competitive labour market – the modern employment environment, where many employees who may have a temporary employment status, where the use of outsourcing is common practice, or where there are those who are under-employed, there is great importance in adopting a robust job search behaviour for job seekers. However, employees may have other factors that affect their job search behaviour. In Trusty, Allen, and Fabian (2019), various motivational categories were put forward. These seven different categories range from wanting to avoid undesirable situations in the workplace to finding better job search methods.

Purpose – This article seeks to explain the data related to this research; it will focus on combining positive psychological capital with seven different sources of motivation, as categorised in Trusty et al. (2019).

Methodology – The method that will be used for this article will consist of a semi-structured interviews, which were used as a vehicle to gather qualitative research and for data collection. The interview questions were prepared using the seven different categories of motivation as detailed by Trusty et al. (2019) and related literature to determine the job search behaviour of the employees.

Findings – The findings will also include input from managers of human resources department employees, where job search behaviour was found to be high, indications suggest problems caused within the working environment, includes poor working relationships with colleagues and supervisors. Also the inability to optimise the skills of individuals and limited career progression opportunities are examples that effect job search behaviour and attitudes to work.

Introduction – As a financial instrument, tax has always been one of the policy support instruments that governments apply to solve problems. The issue of the environment, on the other hand, is a notion that has gained more importance over the past years and governments struggle to create solutions to environmental problems on the global scale. Climate change is one of the most important parts of this issue. Especially in our modern day, as a result of natural disasters, forest fires and landslides, climate change has become a field in which serious political measures should be taken. Although it has become necessary to implement tax as a tool to decrease carbon emissions and to open new fields for works with less carbon emission, the expected/desired results about carbon emissions have not been obtained throughout the world.

Purpose – The aim of this chapter is to examine carbon taxes, which are the tax applied against climate change, and to draw attention to the multiple policy approach in the face of global environmental problems.

Methodology – This chapter, in which qualitative research method is adopted, has descriptive elements. In this context, an evaluation has been put forward in the light of the data obtained from various reports and scientific articles.

Findings – Though tax is indeed considered as an effective political tool among the precautions to be taken, one-dimensional approach might bring along a deadlock in the solution of this problem. In order to improve this approach and the perception towards the environment across society, it is necessary to include other factors that can play an important role in this process such as non-governmental organisations. Consequently, in order to solve the environmental problems which have occurred as a result of human activities, it is essential to minimise the destruction caused by these human activities (although it is not possible to restore it completely). Therefore, a multi-dimensional policy instead of a one-dimensional policy, an environmentally conscious society and state, and cooperation of policy actors on a global scale are basic elements which can play an important role in the solution of the problem.

Introduction – Community media was created as an alternative to the ever-globalising and rapidly monopolised media industry. This media is a unity that does not seek profit, voices the demands and problems of the community it serves, seeks the benefit of the public, and its creators are members of the community. It is seen as a tool for the development of democracy and pluralism, and to increase social impact. The sustainability of this tool has emerged as a debated topic in recent years. Community media can both serve as a tool for sustainable development and can be defined as a part of sustainable communication. The sustainability of community media is all about making the presence of the communicative tools of the community permanent and sustainable, or to insure the continuation of the community’s channels of communication as a part of a specific strategy.

Purpose – In this chapter, the author will discuss the concepts of community media, sustainability and female-oriented non-governmental organisations (NGOs), and then attempt to explain the media usage habits and the factors that affect the sustainability of the preferred channels of the female-oriented NGOs in İzmir.

Methodology – The study has been designed using a case study design based on qualitative research methods. Data have been collected via document analysis and in-depth face-to-face interviews. The data acquired were analysed descriptively.

Findings – Findings from the study show that the financial, content production-related, technical, and legal factors affect the sustainability of community media.

Introduction – Since the entry into force of the Treaty of Lisbon (2009), sport has, for the first time, become a policy area of the European Union (EU).

Purpose – The aim of this chapter is to investigate the EU’s anti-discrimination policy for sports.

Methodology – Firstly, all the agreements, regulations, directives, and court decisions regarding nondiscrimination in sports will be reviewed. Secondly, discriminative examples in different sport branches will be investigated. In fact, this research will examine discrimination in both professional and amateur sports, including discrimination towards men, women, and LGBTIQ+ persons. Thirdly, the bodies, institutions, or persons who are accused of any kind of discrimination in sports will be researched, including fans, officials of clubs and federations, referees, players, and sports media. Finally, recommendations will be presented for the development of an improved sports policy that is capable of increasing diversity and equal participation in European sports.

Findings – For many underlying reasons, which the author will try to address in this chapter, there is a tendency to ignore discrimination in sports. Although the EU has passed legislation specifically designed to prohibit discrimination in sport, neither the legal arrangements nor their applications in Member States serve to end any kind of discrimination in the realm of sports. Thus, this chapter will attempt to raise awareness of this crucial and unending problem.

Introduction – In recent years, there has been a growing interest in innovation, not only in developed countries but also in developing countries. However, there has been limited literature for the developing countries.

Purpose – The literature on national innovation systems (NIS) mainly consists of case studies or qualitative researches aiming to explain the patterns of innovation, while the quantitative analysis are limited in explaining the innovation capability and efficiency of innovation. This study is unique in a sense that it compares the innovation efficiencies of the EECA countries. This chapter aims to measure the efficiency of NIS via data envelopment analysis (DEA) method.

Methodology – DEA is used to consider a sample of 18 Eastern European and Central Asian (EECA) countries and Turkey. One of the main issues is to determine the input and output variables because the available data for some of these countries were limited. Therefore, research and development expenditure (% of GDP), government expenditure on education, total (% of GDP), imports of goods and services (% of GDP) and foreign direct investment, net inflows (% of GDP) were determined as input variables. Output variables were as follows; patent applications both residents and non-residents, high-technology exports (% of manufactured exports) and scientific and technical journal articles.

Findings – Based on the key findings it can be noted that Kazakhstan, Turkey, Latvia and Uzbekistan are more efficient in innovation performance compared to other EECA countries. Throughout the results of the DEA, these countries may develop new policies about their innovation systems to reach out the higher performance.

Introduction – Emerging markets are under the influence of many external factors in global market conditions. International interest rates and price fluctuations in major stock market indices are also among these factors. The FED policies shape the international capital movements in particular, which significantly affects the emerging markets. For this reason, emerging stock markets may show different reactions especially in times of crisis.

Purpose – The purpose of this study is to investigate whether the BIST30 index acted in accordance with the overreaction hypothesis (ORH) against the return changes in the Dow Jones Industrial Average (DJIA) index in the process of the 2008 global financial crisis.

Methodology – The data set of the study was analysed by dividing it into two periods. The first period is the monetary expansion period between 17 August 2007, when the Federal Reserve (FED) reduced the interest rate for the first time, until 22 May 2013 when the FED announced that it would reduce the bond purchases. The second period is the monetary contraction period including the dates between 23 May 2013 and 1 June 2017. An error correction model (ECM) was established in both periods for the indices, determined as cointegrated. The validity of the ORH was tested by Cumulative Abnormal Return (CAR) Analysis.

Findings – According to the ECM, the authors identified that the effect of short-term changes in the DJIA return in the monetary expansion period on BIST30 index return was higher than that in the monetary contraction period. However, according to the findings obtained from the CAR analysis results, the BIST30 index did not generally act in accordance with the ORH against the DJIA. Findings can be appreciated as a decision-making tool especially for investment specialists and investors interested in securities investments.

Introduction – Stability of commercial banks is on the back stone of a country’s economy and its development, making bank stability one of the main concerns of financial regulators. The bank stability models for large and small economies differ significantly.

Purpose – In this chapter we examine the determinants of bank stability in a small post-transition economy, based on the case of Latvia. Latvia has a well-organized banking system, providing a wide range of services to local and international customers. Besides, the Latvian banking sector is quite unique in Europe as it comprises two sets of banks with radically different target groups of customers and sources of revenue.

Methodology – To carry out this study we analysed panel data of the quarterly financial statements of Latvian banks operating during the period 2012-2017.

Findings – We found evidence of a negative significant relationship between size and bank stability, negative significant impact of liquidity risk on bank stability, a positive significant relationship between capital adequacy and bank stability, as well as a positive significant relationship between credit risk and stability. These results increase the importance of a sufficient level of capital adequacy ratio and liquidity to maintain bank stability. In general, the results of the study confirm the results of other studies on bank stability of small economies, with some exceptions due to the unique situation in term bank business models applied by Latvian banks. The current study provides valuable policy implications to small post-transition economies and stakeholders in general.