Journal of Applied Business and Economics

Overcoming Poverty: The Impact of Entrepreneurship Training

Maureen Snow Andrade — 2024-11-30

Educational attainment may deter entrepreneurial activity. Educated individuals have greater job choice while lacking education can drive entrepreneurship out of necessity. Entrepreneurial training helps individuals learn the skills to launch businesses and become self-reliant. This study examined the efficacy of an entrepreneurial preparation program in Mexico by analyzing survey responses related to education and motivation. Findings indicate that factors other than training had more impact on business ownership. Motivational factors were positively correlated with the likelihood of being an entrepreneur. Mother’s education level was positively correlated with the likelihood of working for someone else.

Exploring the Effect of the Government Interventions on the Information Asymmetry in the Post-Pandemic

Chih-Hsiung Chang — 2024-11-30

The article aimed to explore the effect of the government intervention on the information asymmetry in Taiwan’s credit card market during the post-pandemic. To achieve the goal, the article constructed the information asymmetry model which was combined with the government interventions, adverse selections and moral hazards and designed the hypotheses. It was concluded that the government interventions involved with the fiscal and monetary policies failed to improve the market failure and even caused the government failure. The conclusions revealed a significant implication for the policymakers to make the proper policies when facing the challenges in the future.

A Generalized Autoregressive Conditional Heteroscedasticity GARCH for Forecasting and Modeling Crude Oil Price Volatility

Gbolahan Solomon Osho — 2024-11-30

This current study explores the application of Generalized Autoregressive Conditional Heteroskedasticity (GARCH) models to forecast and model crude oil price volatility. Crude oil is a vital commodity whose price fluctuations significantly impact global economies, energy markets, and strategic decisions of both National Oil Companies (NOCs) and International Oil Corporations (IOCs). Using the GARCH(1,1) and GARCH(1,2) models, this study evaluates the effectiveness of these models in capturing the dynamic nature of oil price volatility. The findings indicate that while both models fit the data well, the GARCH(1,1) model is preferred due to its parsimonious nature and comparable forecast accuracy. Despite including an additional lag in the GARCH(1,2) model, it did not significantly outperform the GARCH(1,1) model in predictive performance. The study further analyzes the residuals and autocorrelation characteristics, highlighting the potential for model refinement. The study underscores the importance of selecting an appropriate model complexity, incorporating external factors, and exploring advanced methodologies to enhance forecast accuracy. These insights are critical for developing effective risk management strategies and informing policy decisions in volatile crude oil markets.

ESG Disclosure Based on Regulatory Landscape: An Enquiry Into the Stock Exchange Enlisted Banks in a Fastest Growing Economy

Sangida Akter Saroni — 2024-11-30

This research aims to reveal the extent, modes, and trend of ESG disclosure by the banks in Bangladesh. Analyses involve annual reports of 28 banks from 2016 to 2022 through the content analysis method using a ‘checklist’ comprised of 143 ESG disclosure items compiled from several policy guidelines regarding environmental and social performance disclosure circulated by the central bank, Bangladesh Bank. The study finds a spontaneously increasing tendency for ESG disclosure during the study period. Banks disclose information in both financial and non-financial modes, along with necessary details. However, information non-disclosure results in 75.18%, 63.38%, and 67.40% of environmental, social, and governance information, including many important ESG aspects that should not be ignored. The study result represents an optimistic scenario of ESG disclosure; nonetheless, Bangladeshi banks are yet to develop ESG disclosure practices.

Information Technology and Electronic Commerce Investments, Time Trends of the Speeds of Adjusting the Actual Toward the Maximum Pay, and Chief Executive Officer Compensation

Winston T. Lin — 2024-11-30

This research analyzes the effects of information technology (IT) and e-commerce (EC) investments and trends of the speeds of adjusting the observed toward the desired CEO pay in US firms, based on the adjustment model and its associated adjustment valuation (AV) approach, where the adjustment speeds are assumed dynamic and variable. The findings include: the speeds of adjusting the observed toward the unobserved compensation are fast; either IT or EC appearing alone or jointly impacts CEO compensation; the trends of adjustment speeds are nonlinear and nonstationary; and overall, the US CEOs tend to underpay during the period under study; among others.

Predicting Counterproductive Work Behaviors: Examining the Role of Spiritual Intelligence and Personality Traits in Public and Private Sector Organizations

Neha Jain — 2024-11-30

Counterproductive work behaviors are intentional and harmful behaviors directed either towards the organization or towards its people. This study attempts to examine the role of two antecedent variables, spiritual intelligence (SQ), and personality based on the Big Five Personality dimensions (extraversion, agreeableness, conscientiousness, neuroticism and openness) in predicting the occurrence of counterproductive work behaviors. Two dimensions of counterproductive work behaviors: rating and self-indulgence were used in this study based on the tool developed by Jain & Singh (2020). A sample of 351 employees working in both public (170) and private (181) sector organizations in India was taken for the purpose of the study. Mean, correlational analysis and multiple hierarchical regressions were carried out to test the hypotheses. Significant results were found for both personality and spiritual intelligence (SQ) in predicting counterproductive work behaviors across both public and private sector organizations. The two antecedent variables significantly improved the model's predictive power, for both public and private sector organizations, though to a lesser extent in the private sector. No difference was found based on gender.

Auditing Transformation: A Model of Artificial Intelligence Adoption

Joseph B. O’Donnell — 2024-11-30

Auditors using artificial intelligence (AI) offers opportunities for transforming audits, and drastically improving audit effectiveness and efficiency. Generative AI, augmented AI, and AI performing an entire audit offer possibilities for enormous cost savings and the potential to dramatically improve audit quality. Obstacles to audit adoption include AI processing opaqueness, shortage of auditors with AI knowledge, a dearth of AI audit standards, and significant AI implementation costs. This paper develops a theoretical auditor AI adoption model utilizing innovation diffusion theory (IDT) and the Technology Acceptance Model (TAM). The paper provides suggestions for facilitating auditors’ adoption of AI.

Expectations vs. Abilities: Bridging the Gap

Mary Andrews Martin — 2024-11-30

The purpose of this grounded theory study which applies qualitative techniques, using open-ended interviews and surveys, is to address the problem that businesses lack efficient and effective work production due to entry-level employees not being adequately prepared. The specific purpose is to understand what deficits currently exist between demands and abilities, and what can be done to eliminate those. While there is always some on-the-job training, having this knowledge will fill the current gap in the literature and better prepare entry-level practitioners. While this study looks specifically at accounting students, it can be applied to all areas of business.

The Geographic Proximity Among Firms, Auditor Office and SEC office and Audit Fees

Liang Fu — 2024-11-30

This paper investigates the geographic distances among the auditors, audit clients, and the regulatory agency Securities & Exchange Commission (SEC) and their impact on audit quality. Consistent with the exacerbated information asymmetry issue caused by distance, we find the audit quality is negatively associated with the distance between the client/auditor and the SEC offices. We further find that auditors charge higher fees when they are closer to the SEC office, irrespective of the client’s distance to the SEC. This suggests that the distance between auditor and the SEC has a more prominent influence than the client’s location on the audit quality.

A Content Analysis of the Modernization of Regulation S-K Items 101, 103, and 105

Orry Swift — 2024-11-30

In 2020, the U.S. Securities and Exchange Commission (SEC) adopted amendments to modernize the disclosure requirements of Regulation S-K Items 101, 103, and 105. These amendments aim to enhance the readability of disclosure documents and provide investors with more relevant information. This study conducts a content analysis of the modernized disclosure items to assess the extent and nature of the changes implemented. A sample of annual reports filed before and after the amendments was examined to determine whether the SEC meets its stated goals of improving the readability of disclosure documents and discouraging repetition and immaterial information. We conclude that the stated SEC goals for modernization were not met in terms of textual characteristics. These findings provide insights into the effectiveness of the SEC's efforts to update disclosure rules and improve investor’s informational value.