A study on the effects of earnings management practices on bank cost efficiency, using banking data in five ASEAN countries, was conducted in 1989-2015. The Stochastic Frontier Analysis technique employed to gauge cost efficiency revealed that each country has different efficiency level. With panel data analysis, we further discovered that increase in earnings management practices reduces bank's efficiency significantly. It is suggested that banking supervisors and managers should formulate strategies that focus on cost efficiency-related initiatives and regulate earnings management practices. Such strategies could potentially facilitate the economic integration of ASEAN countries.

The article aims to solve the problem of unequal income distribution in Malaysia. Income inequality did not change significantly since 1990. Inclusive growth is an alternative way that can help the government overcome the unequal distribution of income. However, there are no measurements or detailed studies conducted in Malaysia. Moreover, the country’s distribution policy for the 2016–2030 period focuses on inclusive economic growth. Based on the above gaps, we constructed the Malaysia Inclusive Index and estimated the income distribution using this new composite index. To construct the index, we applied the Z-score method. We obtained data for this study from the World Development Indicator, Economic Planning Unit, Department of Statistics, Malaysia and annual reports from various ministries. The main research findings show yearon-year growth from 1990 to 2016, indicating that economic growth in Malaysia is increasingly inclusive. Therefore, to achieve inclusive and equitable economic growth in distribution, the government is advised to consider not only fiscal aspects, but also holistic components comprised of education, health, housing and employment of the B40 group (lower class). Simultaneously, the M40 group (middle class) should not be left out. Income distribution factors and the Malaysia Inclusive Index (MII) determinants such as investment, inflation, education and national income should be considered when developing national distribution policies, as these factors are crucial for inclusive growth in Malaysia

This paper examines the effects of cost and profit efficiencies on post-merger bank market risk. We use Stochastic Frontier Analysis to estimate cost and profit efficiencies, and Value at Risk and Expected Shortfall to calculate the market risks. We measure the effects in panel analysis using data from banks listed on the Bursa Malaysia over the 2000-2015 period. The results show that the post-merger banks can sustain the market risk exposure from the global financial crisis. The increase in cost and profit efficiency increase the market risk. The findings could be used for the bank regulators and managers to focus on the efficiency-related initiatives to manage the market risk better.

This article investigates the effect of efficiencies on market risk using a sample of Chinese commercial banks from 2000 to 2015 using different measures of market risk; the Value at Risk (VaR) and Expected Shortfall (ES). The cost and profit efficiencies are estimated by the Stochastic Frontier Analysis (SFA) on the 12 biggest banks listed on the Shanghai Stock Exchange. In testing the effect between efficiency and market risk, this study applied four different models to uncover the relationship between VaR and ES as measures of market risk on cost and profit efficiencies. Utilising a panel data analysis, the results show that different banks efficiencies affect market risk measures differently. While bank cost efficiency reduces market risk, increase in profit efficiency increase market risk. The analysis in this study helps explain the unconvincing evidence of an inefficiencies-risk connection in the bank sector. Bank regulators and managers may need to focus on the cost and profit efficiencies-related initiatives to better manage the market risk. These findings provide bank managers with more understanding of bank risk and serve as an underpinning for bank supervision efforts aimed at strengthening the joint risk management of efficiency market risks.