International Research Journal of Finance and Economics
 Issue 125
 September, 2014
A Proposed Framework that Maximizes the Social and Economic Returns of Public Education in Egypt
Ashraf Helmy

One justification for the government to provide education services is to achieve social justice, as this supports low-income students to join all levels of education; however, the present education services provided by the Egyptian government ostensibly support social equity, as it provides low-income students with inappropriate quality of education relative to the quality of education their counterparts receive by the private education system. As a result, rich’s opportunities to get high-return jobs increase, while poor’s opportunities to get suitable jobs decease. Thus, poor people lose the only source available for them to generate income and the only way to improve their living standards. So the gap between the rich and the poor widens, which ultimately threatens the social stability in the economy.
In this context, this paper provides a proposed framework that improves the quality of the outcomes of the Egyptian education system through all its phases (primary, secondary and tertiary levels), prepare these outcomes to match labor-market demands through vocational and academic education, and finally ensure equitable opportunities to access to education services. This framework improves the efficiency of utilizing the resources directed to education sector, as it maximizes the private and external benefits resulting from the exploitation of these resources. The most important thing is the social benefit that accompanies the implementation of this framework as the quality of education service provided for the poor, through this framework, enables them to participate in the production process, instead of being languished on the margins of the society, and hence generate suitable incomes enable them to improve their standard of living.
A Decomposition Analysis of Labor Force Participation Trends of Turkish Young Men and Women School-to-Work Transtion
Serkan Değirmenci and Gülçin Elif Yücel

This study aims to explore the changes in the labor force participation trends of young men and women school-to-work transition in Turkey for the period between 1988 and 2008. In this respect, the main research question is what the sources of differentiation in school-to-work transition trends for young men and women over time in Turkey. To explore this question, three hypotheses are tested. First is whether the labor force participation outcomes of young men and women differ by the changes just in the endowments over time. Second is whether the labor force participation outcomes of young men and women differ by the changes just in the coefficients over time. Third is whether the labor force participation outcomes of young men and women differ by the changes both in the endowments and in the coefficients. To test these hypotheses, cross-sectional data and relevant analyses are used. More specifically, first logit regression analysis, then a non-linear decomposition technique is used along the study. The data sets used in the analyses are from the Household Labor Force Survey (HLFS) micro data of the Turkish Statistical Institute (TurkStat). Given the inaccessibility of raw data for 1990s due to legal limitations and for the purposes of the long-run analyses done, HLFS micro data of selected three years -1988, 2000 and 2008- are used. According to the results of this paper, the positive effects of increasing education levels for young women have been counteracted by the negative effects of demographic changes hence with little neteffect on labor force participation rates. The observed decline in labor force participation rates of almost both groups is unexplained through endowment changes, but rather can be attributed to structural changes captured by coefficients. Increasing education levels have contributed to urban young women's participation rate increase, yet their effects have been dampened through decreasing marginal positive effects of higher education, and increasing negative marginal effects of parenthood and structural changes..
Keywords: School-to-Work Transition, Labor Force Participation, Turkey
Day of the Week Effect: Evidence from Islamabad Stock Exchange
Arif Noor and Syed Zulfiqar Ali Shah

Anomalies are the event that shows the unseasonal pattern in the stock return. Day of the week effect (DW) effect study has been the focus as the anomaly in the stock markets. The daily stock returns from the ISE 10 index have been calculated from data January 2004 to December 2012. The trading period consist on five working days. For the identification of DW effect the ANOVA analyses have been perform and the result depict that the Monday have negative returns and Friday have positive returns but the ANOVA analyses shows that the returns on the days is not significantly different from each other. So the study concluded that the day of the week effect is not present in the Islamabad stock exchange and the market efficiency is not affected by the DW anomaly.
Keywords: Anomalies, Day of the Week (DW) Effect, ISE 10 Index, ANOVA.
Do Income and Income Distribution affect Health Outcomes in Nigeria?
Anthony Orji, Ebenezer Okechukwu and Jonathan Emenike Ogbuabor

Adopting a multilevel approach, the crux of this study is on the impact of income and income distribution on health outcomes in Nigeria. Data from the National Demographic and Household Surveys (NDHS) (2008) are used for empirical analysis. The results show that absolute income has significant impact on population health in Nigeria. However, there are significant variations in the effects of absolute income after controlling for the measure to prevent malaria using insecticide-treated nets, percentage distribution of the population by type of toilet facility, percentage distribution by type of refuse disposal facility and access to healthcare facility in Nigeria. The results also show that relative income has no significant impact on population health. Also, the Gini coefficient and the Pietra inequality indices mimic each other for both absolute and relative incomes. The Gini coefficient expresses a near maximum inequality for the population health due to absolute income, and a near perfect equality of the population health due to relative income. This empirical evidence therefore reveals that income distribution has significant impact on health variations across states in Nigeria. We therefore conclude that there is need for sustained implementation of sound health and income policies that will raise absolute incomes, ensure more equitable income distribution, and enhance better healthcare delivery in order to improve the living standard of Nigeria’s teaming population.
Keywords: Income; Income Distribution; Income Inequality; Population Health; Health Outcomes; Absolute Income Hypothesis; Relative Income Hypothesis
JEL Classifications Codes: D31; D63; E24; I10; O15
Role of Advertising and Consumer Involvement in Purchase Intention of Health Drinks: An Empirical Study
S. Manimaran and M. Parveen Roja
Engaging the consumer towards their brands is the main objective of every marketer and advertisements act as a key to it. Advertising to gain its momentum requires the involvement of the customers and thus it reaches the minds of the customers. However it would be effective only when it creates the intention to purchase the advertised brands thus possibly leading to the purchase behavior. The current study focuses on the involvement and purchase intention. The direct and indirect effect of this involvement on the purchase intention of the customers is studied in the health drinks market in the Indian context. The study is done in five cities Chennai, Madurai, Coimbatore, Trichy and Tirunelveli. The Involvement criterion in this study included the advertising message involvement, the consumers’ product and technology involvement. The direct effect of these involvements on purchase intention, the direct effect of the brand attitude on purchase intention and the indirect effect of these involvements through the brand attitude are analysed in the current study. The findings of the structured equation modeling shows that the brand attitude acts as the effective mediator between the advertising message involvement, consumer involvement towards the product and technology and purchase intention.
Keywords: involvement, brand attitude, purchase intention
A Comparative Study on Quality of Worklife among Employees in Public and Private Sector Banks
S. Manimaran and N. Geethanjali
The term Quality of Work Life (QWL) was initially introduced in the late 1960’s as a way of focusing on the effects of employment on worker health and general well being, and a way to enhance the quality of a person’s on-the-job experience. The present study confined its objectives to test the reliability and validity of measurement scales of employee’s QWL among the bank employees, its impact on the job satisfaction among the employees and to identify the discriminant QWL among the employees in public and private sector banks. The study was designed as a descriptive study with the intention to look at the phenomenon of QWL as it is in the banking industry. The sampled employees were distributed among the public and private sector banks at Dindigul District, Tamilnadu with the help of Stratified proportionate random sampling. The present study concludes that the existence of quality of work life in private sector banks is higher than that in public sector banks except in the case of employee satisfaction and continuance, and job awareness and commitment among the employees.
The Dangers of using Daily Value at Risk Estimates for Understanding Risk in an Inefficient Market
Arthur L. Dryver

Value at risk (VaR) estimates what could be lost in a worst case scenario. VaR at the X% level is what might be lost or more for the worst X% of the time. VaR is used to mitigate risk. Daily VaR is used to understand the VaR on any given day. A 1% daily VaR is expected to occur once in a hundred days. It is natural to feel that if a 1% VaR occurs, the portfolio should not take another large hit of the same size VaR any time soon, as 1% is 1 in 100. In an efficient market after a portfolio takes a 1% daily VaR hit, there is a 1% chance of another hit the next day. In an inefficient market, for example, a moment market, the probability could be much higher. In this paper the dangers of assuming an efficient market are explored when considering daily VaR using theory and empirical data.
Keywords: Market efficiency, Risk management, Value at risk
The Copula-GARCH Model of Conditional Dependence Structure between the Exchange Rate and the Imports of Thailand
Chakorn Praprom

This paper aims to investigate the correlation of the dependence structure between the USD/THB exchange rate and the imports of Thailand, using copula based on GARCH model with skewed student-t distribution. ARMA(1,1)-GARCH(1,1) was adopted to analyze each of marginal time series. Moreover, I obtained the various standardized residuals to transform into suitable uniform [0,1]. Afterward, the Box-Ljung test was employed to verify whether both marginal distributions had still suffered in autocorrelation or not. Subsequently, the Kolmogorov-Smirnov (K-S) test was applied to investigate the uniform (u and v) from each univariate distribution are transformed to appropriate uniform [0,1] or not. The main results of this paper indicated that Gaussian copula is an appropriate copula family to explain the correlation for bivariate distributions both of static and time-varying copulas because AIC and BIC values of Gaussian copula provided the smallest value among the static and time-varying copulas.
Keywords: Volatility, ARMA-GARCH, Import, Exchange rate, Copula, Time-varying copula
Turkish Bilateral Trade with Selected Trade Blocs: A Panel Gravity Model Approach
Gülçin Elif Yücel

This paper reports an empirical study about the determinants of the intra-industry trade (IIT) of Turkey between several trade blocs by decomposing total IIT into its horizontal and vertical components. The hypotheses used in the study are derived from theoretical models and previous empirical studies. Since gravity models have been applied in the analysis of bilateral trade for a long time, this study is among few studies that estimates the determinants of IIT using a gravity model in a panel data setting. All calculations are made for the manufacturing sector by using Turkish bilateral trade data for 2000-2009 period based on 4-digit International Standard Industrial Classification (ISIC) Rev. 3 data which is obtained from Turkish Statistical Institute (TURKSTAT) database.
Keywords: intra-industry trade, trade-blocs, panel gravity model
Stylized Patterns of Volatility in Indian Equity Market during Pre and Post Global Meltdown: A Time-Series Analysis
Soumya Guha Deb

This study explores patterns in the volatility in Indian equity market with respect to some of the stylized properties like, ‘clustering’ and ‘asymmetry’and also the impact of ‘trading volume’ on it,during the pre and post global meltdown. The study uses the GARCH(1,1) and its asymmetric extensions, EGARCH and GJR-GARCH models with three error distribution assumptions in each, to analyze these stylized patterns. Time series daily return data of NSE NIFTY and daily trading volume data of NIFTY stocks over a period of 19 years from June 1995 to January 2014 was used for the study. The models were run separately across four different subperiods, into which the entire study period was divided, to see differential patterns, if any, across time.This study shows considerable evidence of ‘clustering’ and ‘asymmetry during all the subperiods. Trading volume’ has a small positive effect on volatility in all subperiods except for the post meltdown period where the effect is found to be negative. The findings of this study should help market regulators in framing future policies and investment managers to have better understanding of the patterns of volatility in the Indian equity market which could be beneficial both from an investment as well as a portfolio rebalancing perspective.
Keywords: Stock Returns, Turnover, Volatility Clustering, Leverage Effect, GARCH, EGARCH,GJR –GARCH.
JEL Classification Codes: G12, C22