Dr. FAGBADEBO Omololu Michael
Department of Public Management and Economics, Durban University of Technology, South Africa.

ISBN 978-93-91312-05-3 (Print)
ISBN 978-93-91312-06-0 (eBook)
DOI: 10.9734/bpi/ieam/v12

This book covers key areas of economics and management. The contributions by the authors include distributive justice, Zipf law, pareto law, maximum entropy, social networks, power struggle, ethnicity, violence conflict, peace-building, political power, Anglo-Egyptian regimes, eco-tourism, business federation, South Africa, poverty, economic growth, complexity/turbulence, household income, broad view of production, household life stages, overburdened women, consumer psychology, cutting-edge technology, microfinance, micro-enterprise, micro-entrepreneur, sale revenue, net profit, economic power, management & control, electrical circuits concepts, cash flow management, efficiency and power factor of economic systems, investing strategy, immigrants, entrepreneurial minority groups, discrimination, economic value, immigration statistics, market segmentation, U.S. men’s shaving gel market, cost leadership strategy, price-quality segmentation, market share leadership, price a strategic variable, strategic groups, data mining, English style analysis, metrical linguistics, economic development, subcontractor, small and medium-sized enterprises, intensified dairy farm, adult equivalence, statistical- econometrical indicators, mandatory audit rotation, audit quality, bank holding, financial expertise, agency theory, signaling theory, corporate governance, destination image, travel motivation, information sources, tourism crisis. This book contains various materials suitable for students, researchers and academicians in the field of economics and management.


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Distributive Justice and the Second Law

Oded Kafri, Eli Fishof

Insights into Economics and Management Vol. 12, 30 June 2021, Page 1-8

In our opinion, the economic inequality which is found in the OECD countries and the salaries of the top executives in the Fortune 100 companies are merely an equilibrium statistical outcome derived from the second law of thermodynamics. This power-law distribution (Pareto law, Zipf Law, and Benford Law) is similar to that of the energy distribution among photons in a blackbody. This distribution yields correctly: the Gini index, the ratio between rich and poor, the relative poverty, the part of the property held by the upper percentiles. In addition, the same distribution is found in the salaries of CEO of the Fortune 100 companies as a function of the number of employees and average salary. Therefore it is concluded that in free economies the wealth is distributed randomly according to the blackbody statistical mechanics.

South Sudan: The Conundrum of a Long-running Social Conflict

Timothy T. Kulang, Chidiebere C. Ogbonna

Insights into Economics and Management Vol. 12, 30 June 2021, Page 9-16

This study examined the conflict in South Sudan, which started in December 2013 due to political dissatisfaction between President Salva Kiir and his then Vice President Riek Machar. South Sudan civil war is traceable back to 1955, when Sudan was trapped in a bloody civil conflict that led to her independence from a long rule by the Anglo-Egyptian regimes in 1956. When South Sudan got independence in 2011 through a referendum where more-than 98 percent of the population supported secession from Sudan, the country became a case study for potential secessions in Africa. However, the euphoria of independence quickly evaporated, and immediately replaced by violent conflict. Thus, the study explored the major causes of the conflict and concluded that political discontent resulting from power struggle among the elites fueled the conflict. Furthermore, the study argues that citing ethnicity as the fundamental cause of the conflict is misleading and ill- conceived. Rather than being the catalyst of the conflict, the present conflict in South Sudan has rekindled ethnic identities and ideologies to a record height. The new wave of ethnic sentiment in South Sudan is as a result of irrational quest for political power and control among the top echelons in the country. Although ethnicity is not considered as the main cause of the conflict, however, given that the present situation has invigorated ethnic identities and sentiments in the country, the study concludes that any viable solution to the conflict must give incentives to fair ethnic and inter-ethnic representation and coalitions.

The purpose of the article is to show how the business federation model can meet demands in ecotourism in South Africa in times with social unrest, violence, economic decline, and illnesses such as HIV/AIDS and Covid-19 hurting the tourism industry. We illustrate how firms in ecotourism can become more competitive by fighting poverty and achieving economic returns at the same time by acting locally in a globalized world. We also illustrate practical steps managers can take to be in frontline in the field of ecotourism.

This paper considers the real value of unpaid work. Actual living satisfaction depends not only on market income measured using the current concept of GDP, but also on unpaid household production. We try to estimate broad household income in Japan based on 2011 government estimates. We assume three household life stages, each of which consists of three cases categorized by the spouse’s type of work. The results show that income differences between the three cases were very small and women worked longer hours than men in all household life stages. This reveals a different possible view of income distribution and poverty, in which women are overburdened.  We found wage-rate differentials are very large between sexes and between full- and part-time workers in Japan, on which unpaid work estimates are based. Considering this, real effects of broad income on income distribution and married women’s contribution to household income would be greater than we have estimated.

Consumer psychology has evolved as a result of the introduction of the notion of 24X7 service. Customers demand the same experience across all channels. The client / customer expects the seller to be easily accessible. . Because of the severe competition, businesses must keep a close eye on their customers' demands and wants, which is why the notion of Customer Relationship Management is so important. Coca-business Cola's strategy is "Think local, act global," which necessitates the implementation of an IT system that accounts for all of the company's global bottlers.

Coca-Cola saw a need for IT that went beyond individual financial procedures as well. To manage the many parts of their global firm, they need an integrated business management system & as a result, Coca-Cola opted to adopt SAP, a cutting-edge technology, to manage their client relationships in both B2C2B and B2C2C scenarios.

This study examines the impact of microfinance on gender based income generating activities of the Khushhalli Bank Ltd client’s in urban zone of district Quetta during year 2011. The Primary data was collected through structured questionnaire from 80 clients (60 beneficiaries and 20 non-beneficiaries) by adopting cross sectional experimental design. In order to analyze the collected data the t-tests were applied. The results show that the microfinance has a positive impact on both male as well female beneficiaries as compare to non-beneficiaries in term of increase in business performance. It has non-significant impact on average sale revenue of both male as well as female micro-entrepreneurs. Whereas it has a significant impact on average net profit, average fixed assets as well as average net worth of the male but having non-significant impact on female established micro-entrepreneurs. Comparison of gender based business performance reveals that the microenterprises operated by male are able to generate better revenue and net income performance also the same results are obtained in case of enhancement in fixed assets as well as net worth. So we may confidently say that male clients are able in utilizing the microfinance services more effectively as compared to female.

Management & Control of Economic Power

Mohammed Safiuddin

Insights into Economics and Management Vol. 12, 30 June 2021, Page 57-73

Business Directory defines economic power as “Conditions of having sufficient productive resources at command that give the capacity to make and enforce economic decisions, such as allocation of resources and apportioning of goods and services.”  This qualitative definition may be sufficient for general discussions, but it doesn’t offer any quantitative measurements for management and control. Is there a way to measure economic power for analysis and synthesis of economic systems in this 21st century?  This chapter presents a new theory on quantitative measurement of economic power based on a set of terms from the field of electrical engineering, used in the measurement and control of electrical power systems.  Circuit theory concepts are used to show how the relationship between cash and cash flow in finance is analogous to that of electric charge and electric current and how education level, as economic potential, is analogous to electrical potential that causes current to flow in a circuit. An individual is identified as the basic cash flow source in the economy.  Circuit models for an individual as well as a typical production facility are developed and demonstrated with couple of examples. Equations for the measurement of economic power, losses, efficiency and power factor are presented.  It is shown that the individuals are the basic cash flow sources and producers of economic power.  Electrical circuit concepts are summarized in Appendix A.  How investments can be made to maximize economic power of firms is presented in Appendix B.

This study examines critical elements of extending citizenship to entrepreneurial minority groups (Lebanese, Mandingos, Indians, Nigerians, and Westerners) and Liberian dual citizens in Liberia by analyzing survey, remittance, and naturalization data collected by Afrobarometer (Round 5 and 6 Surveys), USD Explorer, 2015 Yearbook of Immigration Statistics, and TLC Africa from 2011 to 2015. This is accomplished by correlating associations between variables including Liberians’ gender in survey responses, attitudes of West African countries, Liberian naturalization in advanced countries, and Liberia’s remittances (inflow and outflow) to show the economic advantages of awarding citizenship to foreigners. The long run result reveals that attracting entrepreneurial groups increases investment in new domestic firms, which will likely lead to transformation in national industries, enhancement of citizens’ technical skills, creation of permanent employment, and improvement of citizens’ living standards, as well as increased democratization.

This paper is a part of twelve studies that have tried to analyze the competitive profile of U.S. consumer markets: Men’s Shaving Gel, Beer, Shampoo, Shredded/Grated Cheese, Refrigerated Orange Juice, Men’s Razor-Blades, Women’s Razor-Blades, Toothpaste, Canned Soup, Coffee, Potato Chips, and Alkaline AA Battery. 

Porter associates high market share with cost leadership strategy which is based on the idea of competing on a price that is lower than that of the competition. However, customer-perceived quality—not low cost—should be the underpinning of competitive strategy, because it is far more vital to long-term competitive position and profitability than any other factor. So, a superior alternative is to offer better quality vs. the competition.

In most consumer markets a business seeking market share leadership should try to serve the middle class by competing in the mid-price segment; and offering quality better than that of the competition: at a price somewhat higher to signify an image of quality, and to ensure that the strategy is both profitable and sustainable in the long run.

Quality, however, is a complex concept consumers generally find difficult to understand. So, they often use relative price, and a brand’s reputation, as a symbol of quality.

The total sales of the U.S. Men’s Gel market in 2008 were $ 131 million. We found that the 7-oz Gel was the most popular size with 2008 sales of $116 million. So, we have focused our analysis on this package.

Using Hierarchical Cluster Analysis, we tested two hypotheses: (1) That the market leader is likely to compete in the mid-price segment, and that (2) Its unit price is likely to be higher than that of the nearest competition.

The results supported both Hypothesis I and II for 2008 and 2007. Both the market leader Edge and the runner-up Gillette Series were members of the mid-price segment. Furthermore, the unit price of Edge was higher than that of Gillette Series, as we have hypothesized.

We found that relative price was a strategic variable, as hypothesized.

We also discovered five strategic groups in the industry.

Feature Extraction of English Books on Tourism Using Data Mining

Hiromi Ban, Haruhiko Kimura, Takashi Oyabu

Insights into Economics and Management Vol. 12, 30 June 2021, Page 111-122

According to the White Paper on Tourism for 2020, before the outbreak of COVID-19, 20.08 million Japanese people traveled abroad, and 31.88 million foreigners came to Japan for sightseeing in 2019. It can be said that it had been the time of sightseeing. The knowledge of tourism has become more and more important, and reading materials in English has been indispensable. In this paper, several English books on tourism are investigated, compared with journalism in terms of metrical linguistics. In short, frequency characteristics of character- and word-appearance are investigated using a program written in C++. An exponential function is used to approximate these attributes.  Furthermore, the percentage of Japanese junior high school required vocabulary and American basic vocabulary is calculated to obtain the difficulty-level as well as the K-characteristic of each material. As a result, it is obvious that English materials for tourism have a similar trend in terms of character-appearance to literary writings. Furthermore, the K-characteristic values for tourism materials are high, and older publications with a higher specialty are more difficult to read than journalism. Moreover, as a whole, the book whose publication year is the newest has characteristics close to those for journalism. 

Economic Development and Small Businesses in Japan\(^1\)

Katsuhiko Hirasawa, Pei Xiong, Yutaka Takakubo, Jin Yu

Insights into Economics and Management Vol. 12, 30 June 2021, Page 123-136

Japan's economy lost most of its industrial production force because of World War II. However, from 1955 onwards, Japan achieved rapid economic growth, joining the group of the world's most developed countries by the early 1970s. The period from 1955 to the early 1970s is generally regarded as a period of High Economic Growth. There are various opinions regarding the factors that enabled Japan to attain such high economic growth, referred to as the Economic Miracle. It can be said that Japan's post-war economic development was the result of advancements in technological innovation based on financial assistance from the United States, which established Japan's position in the world economy, loans from the bank, and the introduction of technology from abroad. Needless to say, the "High growth of post-war Japanese capitalism has not been achieved only by giant companies alone. On the contrary, without small businesses, especially in their roles as subcontractors, it would have been impossible to achieve such high growth, which has drawn attention internationally." (Nomura, 1981; 126) The purpose of this article is to make clear the role of small businesses in the process of economic development.

Analyzing the Milk Consumption and Supply of Ulaanbaatar City

Ichinkhorloo Bazarragchaa, Gerelkhuu Tugsuu, Nyambat Luvsandorj

Insights into Economics and Management Vol. 12, 30 June 2021, Page 137-145

Ulaanbaatar (UB) is not only Mongolia's capital and largest city, but it is also the country's fastest growing city. Those who live in urban areas, particularly UB city, are need to consume the most milk. The current level of domestic liquid milk production is inadequate to meet the requirements of the capital city and other major cities. The goal of this study is to analyse the market equilibrium of the liquid milk (estimations were based on cow milk, which has a higher yield than milk from other species of five types of livestock) market in UB city and determine the level of milk supply. Regression analyses were used to estimate functional forms and other required statistical-econometrical variables utilizing market theory, including demand and supply analyses. Secondary data acquired from the National Statistical Office (2004-2019) and adult equivalence conversion process cited from methodological guidance. According to the study results, main finding was comparatively bigger deficit of liquid milk market of UB warn weak position of liquid milk security level (1125.21 t <669.7 t). As a result, it should be desired to promote domestic liquid milk producers in order to improve market conditions as well as national food security concerns. It is apparent that in order to fulfil future demands, more advanced development of intensified dairy farms and support for their activities would be required.

Mandatory audit firm rotation sets a limit on the number of years a public accounting firm may audit a company’s financial statements. After a predetermined period, an accounting firm is no longer eligible to serve as the company’s auditor for a set time interval and a rotation of firms is required. The objectives of this study are: (1) to explore current audit appointment practices by audit firms in Bahrain; (2) to look into the opinions of audit firms in Bahrain on potential effects provided by implementing mandatory audit firm rotation (audit quality); and (3) to investigate audit firms’ views in implementing mandatory audit firm rotation in Bahrain. To achieve these objectives, a questionnaire was developed and distributed to respondents that consist of all auditors working in audit firms in Bahrain. The findings indicated that there is a significant relationship between mandatory audit firm rotation and quality of audit. The study also indicated that longer partner tenure makes the auditor’s performance lack the quality in the auditing process. The average mean for all questions of the hypothesis together is 2.73 with average standard deviation of 0.94 which is less than half of the mean. This means that there is no dispersion among respondents about the questions of the hypothesis. Also, the analysis shows that the t-value is 29.922, which is greater than the table critical value of t (1.66), and the p-value obtained is 0.000 which is less than the value of significance at p < 0.05. These results confirm statistically that there is a significant relationship, so the null hypothesis is rejected and the alternative hypothesis is accepted. this study focused on the impact of MAR on audit quality in Bahrain, further research may be directed towards examining the impact of MAR upon auditor independence and the cost of audit rotation. However, variables other than those included in the questionnaire of the study may affect the MAR.

Change in Bank Equity Stakes before Merger Completion: An Advance Study

Paitoon Chetthamrongch, Lin Lin, Hsaio-Fen Hsiao, . Yu-LunHuang

Insights into Economics and Management Vol. 12, 30 June 2021, Page 164-181

This study investigates the relationship between the changes in the shareholdings of the institutional financial/ investment professionals and the firm-specific characteristics of the acquiring companies prior to merger completion. The present study thus serves to identifying the factors dominating investment behaviors of acquiring firms. Both total and average changes in their ownership are considered to test the popular agency and signaling hypotheses. Evidence shows that commercial banks are more likely to increase their equity holdings of those businesses with increasing current liability and decreasing profitability. The former supports the signaling hypothesis but the latter suggests the agency cost hypothesis is correct. Investment banks, on the other hand, prefer those with increasing assets and a stable financial status. A competitive relation of these financial experts is also presented in terms of the pursuit of greater controlling power over the board against each other before the merger completion date. This paper also uses descriptive statistics and logistic regression analysis to examine the relationship between the financial institutional quarters holdings proportion and the financial characteristics of the bidding firms.  Our findings using logistic regression analysis reveal that the commercial banks holdings are more than investment banks holdings in the bidding firms that commercial banks have greater controlling power.

The objective this research paper is to develop a destination image theoretical model by using tourists’ travel motivation, information and crisis perception. The present study thus serves to developing a competitive position, destination marketers need to evaluate the tourists’ travel motivation, information and crisis perception, which is crucial to the cultivation of the travellers’ image of their destinations. Evidence shows that the model identifies the influence of travel motivation, tourist destination image, sources of information and crises in tourism. Those findings indicate that an attitude towards Thailand’s travel motivation, travel motivation, crises, information sources in the normal situation, and in an unusual occurrence, tended to influence on Thailand’s destination image. Tourism crises were also found to affect directly and significantly Thailand’s destination image. Thai government can take measures to boost the tourism sector during crises, while safety and security are slowly being restored, and once the situation is normalized.  The outcomes of the study have significant managerial implications for destination marketing managers.