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The Effect of Household Debt on Economic Growth in European Union: When is Household Debt “Too Much”?

Posted on Monday April 26th, 2021Tuesday April 27th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	The Effect of Household Debt on Economic Growth in European Union: When is Household Debt “Too Much”?
Author(s):	Zuhal Kurul
Volume:	12
Number:	2
Year:	2021
Page:	269-285
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.321

Abstract

This paper attempts to answer two questions by considering household debt developments in European Union over two decades. First, does the rise of household debt in European Union weaken economic growth? Second, if higher household debt weakens economic growth, when does it happen? In this study, we employ a dynamic panel threshold analysis by using data from 27 European Union countries over the period of 2005-2018. The findings reveal that the relationship between household debt and economic growth is nonlinear and the impact of household debt on economic growth is positive until the ratio of household debt in GDP reaches the level of 62%. However, the impact of household debt becomes negative once that threshold is exceeded. This study also examines the impact of household debt on consumption and the evidence shows that the higher levels of household debt crowd out consumption. The overall results of this study underline the critical role of household debt on economic growth and the risks of high indebtedness.

Keywords:

European Union, Household Debt, Economic Growth, Consumption Growth, Dynamic Panel Threshold Model

JEL Classification:

E21, E44, G51, C23

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The Assessment of Trade Globalization, Trade Openness, and Distribution Through Income Inequality: An Examination in Terms of OECD Countries

Posted on Monday April 26th, 2021Tuesday April 27th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	The Assessment of Trade Globalization, Trade Openness, and Distribution Through Income Inequality: An Examination in Terms of OECD Countries
Author(s):	Onur Ozdemir, Emrah Dogan
Volume:	12
Number:	2
Year:	2021
Page:	245-268
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.320

Abstract

This study examines the effects of trade globalization and trade openness on income inequality within the framework of OECD countries for the period 1980-2016. The empirical findings acquired in the context of baseline analysis show that both trade variables increase income inequality within the specified period. At a more specific level, the real trade openness variable, which is formed by adjusting from the price changes, is also included into the models in which its relationship with the income inequality is negative and highly statistically significant. In the robustness test analyses that include additional explanatory variables supporting the baseline results, both trade openness and trade globalization variables have negative effects on income inequality. The economic logic behind the findings of the study is that the negative changes in the labor market should be considered as the main cause of the negativities behind the basic variables used in the analysis. In other words, the decrease in the bargaining power of labor increases the income inequality at the household level by increasing the share of capital accruing from the national income.

Keywords:

Income Inequality, Trade Globalization, Trade Openness, Distribution, Bargaining Power

JEL Classification:

D33, F4, F60

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The Relationship between Experiential Marketing, Customer Satisfaction and Customer Loyalty: A Research in the Smartphone Industry

Posted on Friday January 29th, 2021Friday January 29th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	The Relationship between Experiential Marketing, Customer Satisfaction and Customer Loyalty: A Research in the Smartphone Industry
Author(s):	Sirin Gizem Kose, Ece Ozer Cizer
Volume:	12
Number:	1
Year:	2021
Page:	219-232
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.319

Abstract

Experiential marketing stands out as a differentiation tool in the intense competitive environment. This study aims to investigate the relationship between experiential marketing, customer satisfaction and customer loyalty in the smartphone industry. In line with this purpose, hypotheses were developed to test the relationship between dimensions of experiential marketing in the smartphone industry, customer satisfaction and customer loyalty. Data were collected from smartphone users via questionnaires and analyzed with structural equation modelling. Results of the study show that all dimensions of experiential marketing are significantly and positively related to customer satisfaction and customer loyalty in the smartphone industry. In addition, customer satisfaction has a partial mediator role in the relationship between dimensions of experiential marketing and customer loyalty. This research states that sense experience is the strongest dimension for creating customer satisfaction and customer loyalty. The findings show the importance of experiential marketing in creating customer satisfaction and customer loyalty in the smartphone industry.

Keywords:

Experiential Marketing, Customer Experience, Customer Loyalty, Customer Satisfaction, Smartphone Industry

JEL Classification:

M10, M31, M39

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A Current Approach to Understand Customers: A Literature Review on Customer Engagement

Posted on Friday January 29th, 2021Friday January 29th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	A Current Approach to Understand Customers: A Literature Review on Customer Engagement
Author(s):	Nilsah Cavdar Aksoy, Ebru Tumer Kabadayı, Alev Kocak Alan, Coskun Ermehan
Volume:	12
Number:	1
Year:	2021
Page:	197-217
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.318

Abstract

In today’s business world, customers do not only behave in a consequence-oriented way in their communication with the company or the brand such as purchasing. They are active participants in the “customer relationships” process. As a reflection of this, customer engagement represents the changing focus of marketing. Customer engagement, which draws attention as a timely approach both in the business world and academia, was investigated in this study through a literature review. 397 articles were classified via content analysis in terms of their approach to customer engagement, the topics they examined, their theoretical backgrounds, the antecedents and consequences they handled and explained. A bibliometric analysis was also conducted based on the publication year of the articles and the journal they were published in. Our literature review shows that the focus is on the application areas of customer engagement mostly, common topics in the studies are online brand communities and social media application areas, and the service dominant logic is often used as theoretical background. While the most common antecedents of customer engagement are experience, benefits and motives, and trust, its most common consequences are customer loyalty, social presence, and commitment. Based on the study findings, an analysis for the current situation of customer engagement for the business world and research suggestions for the academia are presented.

Keywords:

Engagement, Customer Engagement, Consumer Engagement

JEL Classification:

M30, M31

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Investigation of the Effects of Top Management Profile and Firm Structure on Intuitive Strategic Decision-Making Under the Moderating Role of Environmental Dynamism and Environmental Hostility

Posted on Friday January 29th, 2021Friday January 29th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Investigation of the Effects of Top Management Profile and Firm Structure on Intuitive Strategic Decision-Making Under the Moderating Role of Environmental Dynamism and Environmental Hostility
Author(s):	Fahriye Oben Uru, Mustafa Aslan
Volume:	12
Number:	1
Year:	2021
Page:	173-195
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.317

Abstract

The main goal of this study is to reveal the effects of the top management profile and firm structure on intuitive strategic decision-making under the moderating role of environmental dynamism and environmental hostility. Using the convenience sampling method, data were collected from 493 top managers via survey method. Structural equation modelling was used to analyze the data. The findings of this study show that the education level, and sector experience of top management affect intuitive strategic decision-making positively and while their age and tenure negatively affect it. In addition, it is determined that the formalization degree and revenue of the firm negatively affect intuitive strategic decision-making while the number of employees and firm age positively affect it. It is revealed that the negative effect of the age of the top management on the intuitive strategic decision-making weakens as the environmental dynamism increases and even this effect turns positive, whereas the negative effect of the age of the top management on the intuitive strategic decision-making gets stronger as the environmental hostility increases. Furthermore, the negative impact of revenue-based firm size on the intuitive strategic decision-making has been found to increase as environmental dynamism increases. Lastly, it is revealed that the positive impact of top management’s sector experience on the intuitive strategic decision-making gets stronger as the environmental hostility increases.

Keywords:

Intuitive Strategic Decision-Making, Top Management, Firm Structure, Environmental Dynamism, Environmental Hostility

JEL Classification:

M10, M19

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The Assessment of The Intermediation Role of Emotional Labor Dimensions in The Relationship between Cultural Intelligence and Individual Work Performance

Posted on Friday January 29th, 2021Friday January 29th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	The Assessment of The Intermediation Role of Emotional Labor Dimensions in The Relationship between Cultural Intelligence and Individual Work Performance
Author(s):	Ibrahim Yikilmaz, Deniz Devrim Tasdemir, Hulya Gunduz Cekmecelioglu
Volume:	12
Number:	1
Year:	2021
Page:	157-172
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.316

Abstract

Within the organization and market environment, where the number of businesses that provide services focused on a single culture is decreasing, the number of multinational companies that appeal to different customer profiles is increasing, the borders and distances between organizations are reducing, and cultural intelligence and emotional labor concepts are becoming increasingly important in terms of providing vital outputs to organizations. In this study, the data obtained from 261 participants from 50 countries serving for NATO in Afghanistan were evaluated. In the study, the relationship between cultural intelligence, emotional labor, and individual job performance, and the mediating role of emotional labor (surface, deep and genuine acting) in the relationship between cultural intelligence and job performance were examined. The results of the research show that in a multicultural work environment consisting of individuals from different countries and cultures, the cultural intelligence levels of the employees affect their emotional labor behavior and individual job performance. The results also show that the two emotional labor subdimensions (surface and genuine acting) have a partial mediating effect in the relationship between cultural intelligence and individual job performance. The study makes important contributions by addressing the exhibition of emotional labor specifically for public officials (providing security services) and by examining cultural intelligence as the premise of emotional labor and, as a consequent, job performance in an international cultural context.

Keywords:

Cultural Intelligence, Individual Job Performance, Emotional Labor, Surface and Genuine Acting

JEL Classification:

M10, M12

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Service Quality in Private Secondary Schools: Extension to EduQUAL with a case from Turkey

Posted on Friday January 29th, 2021Friday January 29th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Service Quality in Private Secondary Schools: Extension to EduQUAL with a case from Turkey
Author(s):	Cagri Bulut, Sefer Aydogan
Volume:	12
Number:	1
Year:	2021
Page:	145-155
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.315

Abstract

Previous research on measuring the service quality presents alternative assessment instruments of SERVQUAL by customizing the generic indicators of service quality to sector-specific features for various service markets. EduQUAL is the specific method of SERVQUAL assessment for measuring the service quality of educational services. This study contributes to the EduQUAL literature by extending with a new dimension covering the quality assessment of the core educational services with empirical evidence generated in 2019 over the secondary-school students of private schools operating in Turkey. Therefore, the current study aims to extend the EduQUAL assessment of the private chain schools and aims to which of these successful schools’ service quality indicators predict student satisfaction and student loyalty. The study’s data represents 305 students’ perceptions of a private school operating in Turkey with more than 100 branches. The factor analysis results yield a new dimension related to core educational services. The regression analyses’ results reveal that the core educational services predict only student satisfaction with other service quality indicators. Empathy-related services at schools are the most significant indicators of the EduQUAL both on student satisfaction and student loyalty.

Keywords:

SERVPERF, Student Attitudes, Private Education, Private Chain Schools, Turkey

JEL Classification:

M31, I20

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Trade Credit Policies and Shortage of Liquidity in Cycles of Economic Contraction

Posted on Friday January 29th, 2021Friday January 29th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Trade Credit Policies and Shortage of Liquidity in Cycles of Economic Contraction
Author(s):	Bahadir Karakoc
Volume:	12
Number:	1
Year:	2021
Page:	127-144
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.314

Abstract

This study examines the trade credit practices of 11.000 publicly listed firms from 17 countries (9 developed and 8 developing). The results indicate that firms with a lack of short-term liquidity receive more trade credit for a longer duration. It becomes even more pronounced in times of economic contraction. For robustness, both the period of the 2008 financial crisis and a contractionary period are scrutinized. A slowdown in the economy creates opposing effects on firms from developed and developing countries, while the former use less credit for a shorter period; the latter receive more credit for a longer period of time, whereas firms with a shortage of liquidity behave similarly, i.e., they increase the amount and the duration of trade credit. The findings suggest that firms with a lack of liquidity survive troubling times by obtaining more trade credit from their suppliers.

Keywords:

Trade Credit, Economic Contraction, Cash Management, Alternative Financing Instruments

JEL Classification:

G30, G31, G32

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Volatility Spillover between the Stock Market, Exchange Rates, Interest Rates and CDS Premiums: Evidence from Turkey

Posted on Friday January 29th, 2021Friday January 29th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Volatility Spillover between the Stock Market, Exchange Rates, Interest Rates and CDS Premiums: Evidence from Turkey
Author(s):	Zekai Senol
Volume:	12
Number:	1
Year:	2021
Page:	111-126
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.313

Abstract

In recent years, the volatility of financial assets has significantly increased. High volatility causes instability in financial markets and increases portfolio risks. Under these conditions, modeling the volatility, determining the volatility relationships, and volatility spillovers are important for market actors. In this study, for the period January 2, 2010 – April 10, 2020, it was investigated the volatility spillover and correlation relationship between the Borsa Istanbul (BIST) 100 Index, the exchange rates ($/₺), interest rates, and credit default swap (CDS) premiums. It was also examined the effects of economic, political, and social factors on the correlation relationship. In the study, it was seen that the bidirectional volatility spillover between the BIST 100 index – exchange rates, interest rates – exchange rates, and CDS premiums – interest rates, on the other hand, unidirectional volatility spillover from CDS premiums to the exchange rates. A positive volatility relationship was determined between CDS premiums – interest rates and CDS premiums – exchange rates while the negative volatility relationship between interest rates – BIST 100 index and CDS premiums – BIST 100 index. It was also determined that political, economic, and social factors affect the relationships of correlation between variables.

Keywords:

Stock Markets, Exchange Rates, Interest Rates, CDS Premiums, Volatility Spillover

JEL Classification:

C58, E40, G10, G17

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Predicting Direction of Stock Price Using Machine Learning Techniques: The Sample of Borsa Istanbul

Posted on Friday January 29th, 2021Friday January 29th, 2021 by

Article Information

Journal:	Business and Economics Research Journal
Title of Article:	Predicting Direction of Stock Price Using Machine Learning Techniques: The Sample of Borsa Istanbul
Author(s):	Baris Aksoy
Volume:	12
Number:	1
Year:	2021
Page:	89-110
ISSN:	2619-9491
DOI Number:	10.20409/berj.2021.312

Abstract

In this study, stock price with the calculated next three-month average of five manufacturing industry companies in the Borsa İstanbul 30 Index and the Corporate Governance Index was predicted with the data of the 2010/3 and 2020/3 periods. The dataset consisted of quarterly nine financial statements and five macroeconomic variables with a three-month average of the sample companies. Artificial Neural Networks, Classification and Regression Tree, and K- Nearest Neighbor Algorithm were used as prediction methods. A 10-fold cross-validation method was used in all methods in the study. In Artificial Neural Networks, Classification and Regression Tree analysis, the models that gave the best results in line with the given parameter ranges were obtained by using the determining the best parameters and performance criteria function. According to the results of the analysis, general classification accuracy was achieved 98.05% for Artificial Neural Networks, 96.10% for Classification and Regression Tree, and 92.20% K-Nearest Neighbor Algorithm. “Net Profit Margin”, “Price/Earning”, “Profit Per Share”, “CDS Premium (3-month average)”, “Consumer Confidence Index” were found as important variables that divided the data into two in the creation of the Classification and Regression Tree (CART) analysis. This result shows that the models used in this study can be incorporated into the models used by investors.

Keywords:

Prediction of Stock Price Direction, Borsa İstanbul, Artificial Neural Networks, K- Nearest Neighbor Algorithm, Classification and Regression Tree

JEL Classification:

C45, C51, E27, E44, G11

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