The study aims to empirically examine the determinants of bank margins from Pakistan, an emerging South Asian economy. To elucidate the importance of the Pakistani banking sector, secondary data has been used, which was extracted from the annual accounts of twentyfour Pakistani scheduled commercial banks (20 conventional, four full-fledged Islamic) over a sample period of 2006 to 2017. The factors identified in the dealership model and the subsequent empirical developments in the dealership model categorized as bank-specific, diversification, regulatory, and industry concentration are analyzed by applying the most-common linear dynamic panel-data estimator, the Generalized Method of Moments (GMM) estimator, developed by Arellano and Bond (1991). The findings reveal that, among the bank-specific variables, funding cost, credit risk, managerial efficiency, market share, and operating cost are significant predictors of bank margins. For diversification variables employed in the study, both variables including net non-interest income and asset diversity are as well significant predictors of bank margins. It is also found that the market concentration variable proxied by the Herfindahl-Hirschman Index (HHI) is significantly predicting bank margins. Subsequently, one of the regulatory variables, the opportunity cost of holding reserves, and one bank-specific variable, the degree of risk aversion, are insignificant in the model.
This empirical research is aimed at testing the relationship of the big five personality traits namely openness to experience, extraversion, consciousness, agreeableness, neuroticism, and risk aversion with the investment intention of individual investors belonging to Balochistan, Pakistan. The primary data is collected through a self-administered questionnaire (a structured form that consists of a series of closed-ended and open-ended questions) from a sample of 397 active individual investors belonging to different districts of the province. The data is empirically analyzed by applying the Partial Least Square (PLS) path modeling technique by using the estimation package available in Smart-PLS. The findings of this study suggest that all the variables are statistically significant with investors' investment intention with risk aversion as the strongest predictor. Moreover, openness to experience, extraversion, consciousness, agreeableness, and risk are significantly and positively related to an investor's investment intention, whereas neuroticism is negatively related to an investor's investment intention. The results extended by this study can be used by financial planners and investment bankers to channelize the available financial resources in diversified portfolios. The results will help financial planners to make available diverse investment alternatives for investors in Balochistan, thus catering to their unique needs. Academia must offer courses on contemporary finance paradigm based on behavioral finance to enable future business graduates to make wise financial decisions.
Despite the academic value of factor analysis (FA) on Likert scale data, its statistical legality has been relentlessly questioned by professional statisticians. This article reviews relevant literature and proposes a statistically appropriate method of getting most out of FA on Likert scale. The review shows that a larger sample size is an important consideration in improving the appropriateness of FA on LS as it improves the solution in terms of normality, communalities and loadings. Further, a 7-9 point or greater scale to account for normality, an alpha level of 0.01 or 0.005, polychoric correlation instead of Pearson's are reported to improve the statistical appropriateness of the test of Likert scale. Moreover, using non-parametric alternatives like CATPCA to testify the results of FA greatly increased the overall value and validity of the test.
This study aimed at exploring how the perception about leadership styles affected the functionality of the Higher Education Institutions. We used a self-administered questionnaire to a sample of 328 administration and faculty members of several public sector universities. The data collected were analyzed through structural equation modeling in AMOS 26. We found significant results between autocratic and democratic leadership styles as determinants of organizational functionality; such that the perceived autocratic leadership style negatively affected organizational functionality and the perceived democratic leadership style positively affected organizational functionality. The effect of laissez-faire was however statically insignificant. We thus conclude that the perception of a democratic leadership style improves organizational functionality; whereas, the perception of autocratic leadership negatively affects organizational functionality. Practically, the study shows as the employees are given the right to participate in the matters of a higher education institution, the organization becomes more functional.
In this study we attempted to explore the effect of authentic leadership on followers’ feedback reactions in the performance appraisal context using trust in leader as the mediating variable. We collected data from a sample of 183 employees working in the information technology sector of Pakistan using a self-administered questionnaire, employing a cross-sectional study design with convenience sampling technique. The study provided empirical evidence about the effect of authentic leadership on performance feedback reactions and the associated mediating mechanism. It drew on authentic leadership theory and investigated why such a leadership style was important in making the performance appraisal process successful and effective. As hypothesized, authentic leadership significantly predicted perceived feedback accuracy and utility (two feedback reactions in performance appraisal). Our findings confirmed that there was a significant mediating effect of trust in leaders between authentic leadership and performance feedback reactions. The inferences drawn based on the results suggested that raters’ authenticity in performance appraisal context creates a trusting situation and leads to ratees’ perception of feedback accuracy and utility.
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