Business Investment Research Articles

Impact of uncertainty on economic growth: The role of pro‐market institutions in developing countries

AbstractVarious shocks, including the Gulf War, the US recession, the 9/11 attacks, financial credit crunch, and domestic political shocks like coups, and revolutions, have contributed to the persistence of high uncertainty. This uncertainty has direct implications for economic activity, affecting both business investment and household consumption decisions. This article explores the mediating role of the quality of pro‐market institutions in the relationship between economic performance and changes in the uncertainty. It also investigates whether reforming pro‐market institutions during a period of uncertainty can mitigate the negative effects of the uncertainty on economic performance, while analyzing the channels through which the mediating effect of reforms during uncertainty manifests. Using a sample of 61 developing countries over the period 1990–2014, our results, robust to various tests, indicate that higher quality of pro‐market institutions significantly reduces the negative effects of uncertainty on economic performance. Indeed, the reduction in GDP growth due to a change in uncertainty decreases by 93 percentage points with higher levels of pro‐market institutional quality, and this variation depends on the nature of the pro‐market institutions considered. Furthermore, implementing pro‐market institutional liberalization reforms during a period of uncertainty could not only alleviate the negative effects of uncertainty but also contribute to medium‐term economic growth. The analysis of channels suggests that this effect is mediated by the impact of reforms on household consumption and business investment. These results highlight how pro‐market institutions and reforms in these institutions can enhance the resilience of economies facing high uncertainty or unexpected and substantial economic shocks.

Analysis of the Impact and Implications of the VAT Rate Increase in Indonesia

This study aims to find out how the impact felt by the community after the implementation of the VAT rate increase policy on individuals who act as end consumers, and business actors or MSMEs who act as distributors. The method used in the study is Systematic Literature Review (SLR) from various studies on the impact and implications of VAT rate increases in Indonesia. The results of the study show that VAT affects the price of goods and services in the market, increases production costs and selling prices, and worsens inflation. However, the increase in VAT rates can also increase government tax revenues, reduce the budget deficit, and stabilize the country's fiscal condition. In addition, the increase in VAT can affect consumer behavior and business investment, especially in the manufacturing, trade, and service industry sectors.

Analisis Peran Keuangan Syariah dalam Pembangunan Ekonomi

The role of Shariah finance in economic development has been the subject of increasing research and policy discourse. Although empirical evidence of the sharia financial impact remains varied and contextual, sharia finance has the potential to make a positive contribution to economic growth, financial stability, and social well-being. Nevertheless, there are still significant challenges and complexities in realizing the Sharia financial potential as a catalyst for economic development. The study aims to explain the multi-faceted contribution of Islamic finance to economic development. In this research the method used is qualitative method. A systematic review of literature is carried out to build a theoretical foundation, conceptual framework, and empirical evidence related to the role of Shariah finance in economic development. The review includes scientific articles, books, reports, and policy documents from a variety of disciplinary perspectives, including economics, finance, Islamic studies, and development studies. The results of this study conclude that Islamic finance plays a role in promoting financial inclusion, encouraging investment in sustainable infrastructure and business, enhancing stability through risk-sharing mechanisms, and promoting ethical and socially responsible financial practices. By providing financial products and services in line with Sharia principles, Sharia financial institutions can meet the unique financial needs of various segments of society, thereby helping to reduce gaps in access to finance and enhance economic empowerment

Holding Back the Damage: Strong Political Institutions and the Effect of Populism on Business Invest

Holding Back the Damage: Strong Political Institutions and the Effect of Populism on Business Invest

Comparison of Business Investment Value Between Traditional and New Logistics Companies

The logistics industry has experienced significant transformations as a result of the rapid evolution of globalization and e-commerce, leading to notable shifts in business models, technology applications, and service quality. This paper aims to delve into the differences in business investment value between traditional logistics companies and new logistics companies, while also exploring the impact of these disparities on enterprise competitiveness and future development. And as a goal to provide some high-quality suggestions to the new enterprises currently in development and the traditional enterprises in transformation, to promote the upgrading and development of the logistics industry. To achieve this objective, the study utilizes two primary research methodologies: case analysis and comparative analysis., By conducting a comparative analysis of the financial development and service advantages and disadvantages of two representative traditional logistics companies, FedEX and Amazon logistics, as well as modern logistics companies, this study aims to clarify the significance of digital transformation in the development of traditional logistics enterprises. Furthermore, it provides optimization suggestions for digital logistics transportation information security and other risks, ultimately contributing to the high-quality development of logistics enterprises.

Optimal planning and operation of integrated energy systems in South Korea: Introducing a Novel ambiguity set based distributionally robust optimization

In this paper, we address the increasing focus on Renewable Energy Sources (RES) and energy policies in S. Korea, advocating for a shift from large, centralized power systems to decentralized Local Power Systems (LPS). This transition emphasizes the integration of Integrated Energy Systems (IES), which significantly enhances the target benefits for stakeholders in the power system. We have also adopted a Distributionally Robust Optimization (DRO) approach to account for the output uncertainty of RES and developed and applied new ambiguity sets tailored to each RES, enhancing the extensive robust design previously utilized with DRO. By applying our proposed ambiguity set-based DRO, we avoid excessive robustness and achieve superior optimal outcomes compared to the general DRO methodology, potentially making a significant contribution to business investment decisions. We have categorized the main stakeholders of the power system as Independent Systems Operators (ISO), Renewable Energy Providers (REP), Energy Exchange Aggregators (EXA), and End-users. The integration of IES leads to a benefit improvement rate of up to 34.8 %, 23.0 %, and 24.2 % for ISOs, REPs, and End-users, respectively, on a global scale. EXAs can secure an annual economic profit of up to $191,362.

Comparison of Business Investment Value in Real Estate Industry

The global economy is in a downward trend due to the COVID-19 pandemic, the current war between regions, and worsening relations between countries. In 2023, China's leading real estate company, a pillar industry, will be unable to repay its debts. In the context of economic globalization, this paper will explore the impact of the real estate industry in the United States, analyze the investment value through several indicators, and analyze the data of four leading real estate enterprises in the United States, namely D.R.Horton, Lennar Corporation, LGI Homes and NVR. Through the calculation of EPS, P/E ratio, PEG ratio, revenue and EPS growth rate and GP/A ratio, these indicators are used to determine which company is the most valuable investment company among the leading enterprises in the US real estate industry. The research in this paper can not only identify the companies with the highest investment value, but also provide ideas for future research on other companies in other industries.

Analysis of the Potential Attractiveness of Business Investment Cooperation in Natural Resources and Cultural Development of Fakfak Regency

Analysis of the Potential Attractiveness of Business Investment Cooperation in Natural Resources and Cultural Development of Fakfak Regency

Gio-Nigeria Economic Relations on the Development of the Nigerian Textile Sector, 2006–2017

The purpose of the study is to investigate how the economic ties between China and Nigeria have affected the growth of Nigeria's textile sector between 2021 and 2023. The study collected data from stakeholders, including policymakers, business owners, and textile industry specialists, using qualitative research methods such as questionnaires, interviews, and documentary reviews. The study's conclusions will provide important light on how the relationship between China and Nigeria has affected the growth of Nigeria's textile sector and will also include useful suggestions for future legislation and company owners. The study found that, especially during the study period, Nigeria's textile sector has developed favorably as a result of the economic ties between China and Nigeria. The partnership has given manufacturers significant opportunities in Nigeria to have access to Chinese resources, money, and technology. New investments, more manufacturing capacity, and access to new markets have resulted from this. Furthermore, new, more effective production methods have been used due to the cooperation between the two nations, improving the productivity and caliber of the textiles produced. Despite the advantages, especially in terms of profit-sharing, intellectual property, and environmental sustainability. The report recommends that both nations should enact more robust policy incentives to promote investment in regional businesses, support the protection of intellectual property, and work to increase the textile industry's environmental sustainability to address these problems. Moreover, the report suggested, among other things, that the two nations work together more closely to exchange resources and knowledge. In its conclusion, the study showed that it has provided valuable opportunities for textile manufacturers to access capital, technology, and resources from China, while also introducing more efficient production methods. However, the economic relationship needs to be further strengthened in terms of policy incentives, intellectual property protection, and environmental sustainability to maximize the benefits of the relationship for both countries. Received: 28 March 2024 / Accepted: 29 June 2024 / Published: 8 July 2024

Economic Feasibility of LNG Business: An Integrated Model and Case Study Analysis

Liquefied natural gas (LNG), recognized as the fossil fuel with the lowest carbon emission intensity, is a crucial transitional energy source in the global shift towards low-carbon energy. As the natural gas industry undergoes rapid expansion, the complexity of investment business models has increased significantly. Optimizing the combination of various segments within the value chain has become standard practice, making it essential to control risks and enhance economic benefits in these multifaceted scenarios. This paper introduces an integrated economic model encompassing upstream, liquefaction, shipping, regasification, and consumption, suitable for both upstream and downstream integration. The model offers a comprehensive analysis of the primary business models and key factors across each segment of the value chain. By constructing a robust economic evaluation framework, the study aims to provide a holistic approach to understanding the economic feasibility of LNG projects. Two detailed case studies are conducted to demonstrate the application and effectiveness of the proposed model, highlighting its capability to guide investment decisions, support risk management, and optimize asset portfolios. The integrated economic model developed in this study serves as a valuable tool for stakeholders in the LNG industry. It not only facilitates informed investment decision-making but also enhances the strategic management of risks and resources. By leveraging this model, investors and managers can better navigate the complexities of the LNG business, ensuring sustainable and economically viable operations.

Top income inequality and tax policy

Abstract The share of pre-tax income flowing to the top of the UK income distribution increased continually and substantially in the three decades leading up to the financial crisis, but has changed little since 2013. Using microdata sampled from UK tax records, we describe the nature of top incomes in the UK and how they are taxed. We show that wage income is the dominant source of pre-tax income, even for highest-income 0.1% of UK adults. However, ‘active’ business income—derived from self-employment or closely-held incorporated businesses—is considerably more important for the top 1% than for those with lower incomes. High-income wage earners work disproportionately in financial services. The high-income self-employed are predominately working in partnerships in professions such as accountancy and legal services. Overall, UK income taxes are progressive: average tax rates rise with income. Taxes on top incomes have been increased since 2010, with the result that the post-tax share of income flowing to the top has fallen. But average tax rates vary significantly within the top and depend on how income is received. Incomes from business ownership and investment are taxed at lower rates than employment income. We discuss options for reforming the taxation of top incomes.

Multiple Taxation And Business Survival in Anambra State, Nigeria

The study investigated the relationship between multiple taxation and business survival in Awka, Anambra state. The specific objective was to evaluate the effectiveness of existing tax policies in fostering a conducive environment for business survival and to analyze the coping strategies businesses employ in response to multiple taxations. A survey research design was employed on a population of 330 from 11 small-scale entrepreneurs in Awka Anambra State. Taro Yamane’s formula was used to obtain a sample size of 319. This study employed primary data gathered through structured questionnaires distributed to managers/owners of 319 Small and Medium-sized Enterprises (SMEs) in Awka, Anambra State. The hypotheses were tested using the Chi-squared test with the aid of Statistical Package for Social Sciences V.22. The findings revealed that there is a significant relationship between the effectiveness of existing tax policies and multiple taxations (p-value = 0.000); there is a significant relationship between multiple taxations and coping strategies employed by businesses (p-value = 0.000). The study therefore recommends that the Anambra State Government should streamline and harmonize tax collection processes across different agencies to minimize duplication and reduce the financial burden on businesses, thereby fostering a more conducive environment for business growth and investment.

비상장 중소·중견기업 주식의 양도소득세에 관한 문제점과 개선방안

To revitalize the capital market, the government provides tax-free benefits for minority shareholders such as KOSPI (1% or less than 5 billion won), KOSDAQ (2% or less than 5 billion won), and KONEX (4% or less than 5 billion won) if stocks are transferred through the stock market. The taxation of capital gains tax on the over-the-counter market limits the expansion of the unlisted capital market. Since 2018, in order to help small and medium-sized companies belonging to the over-the-counter market and revitalize investment smoothly, K-OTC's over-the-counter market has provided the benefit of exempting minority shareholders from the taxation of capital gains tax when they transfer the stocks of small and medium-sized companies. As for the size of the K-OTC market, the transaction value has increased by more than 10 times so far, starting with the provision of non-taxable benefits in 2018, and the increase of the size of all transactions by more than 2.5 times. In other words, the exemption from the capital gains tax of small and medium-sized companies by minority shareholders in the K-OTC market has led to the expansion of the K-OTC market. However, due to the expansion of the K-OTC market, other over-the-counter markets, as K-OTCBB, are shrinking over time. Considering that companies listed on K-OTCBB are mainly small or have not met the listing requirements of the K-OTC market, the non-taxation of capital gains tax on stocks of small and medium-sized companies provided only to K-OTC is expected to adversely affect securing investment funds for companies listed on K-OTCBB. This is expected to hinder the growth of many small and medium-sized companies and reduce the options of new investments that are attractive to investors. To solve this problem, this paper proposes the following improvement measures. Markets that comply with the standards of Article 178 (1) 1 of the Capital Markets and Financial Investment Business Act, Article 286 (1) 11 of the Capital Markets and Financial Investment Business Act, and the K-OTCBB operation enforcement regulations conducted by the Korea Financial Investment Association should be added to expand the exemption from the stock transfer income tax by adding the content of “stocks in which a single seller and buyer trade over-the-counter stock certificates of small and medium-sized enterprises through mutual consultation on the terms of transaction”. If the K-OTCBB's transfer tax exemption for small and medium-sized enterprises is expanded through the revision of Article 94 of the Income Tax Act, it is expected that the expansion of the K-OTCBB market will lead to the expansion as in the previous case in 2018. In addition, the introduction of an expansion of the capital gains tax exemption will help small and medium-sized enterprises smoothly secure funds. Through this, the size of the K-OTCBB market will grow, and it can provide attractive new investment destinations for investors. As a result, it is expected that it will have the effect of introducing investors' funds into the capital market, and it will lead to the growth of small and medium-sized enterprises and the development of the capital market.

Политическое инвестирование бизнеса как категория политической науки: теоретические версии в современном российском контексте

The article proposes a conceptual model of political investment of business, which reflects the political and economic realities of the modern Russian state. In the conditions of unprecedented external pressure on the national economy, political investment by representatives of business circles at the federal and regional levels is one of the effective tools that contribute to the strengthening of internal dialog between society and government represented by public institutions. Also, political investment provides an increase in stability and investment attractiveness of the economy as a whole, reduces the riskiness and corruption component. The author of the article proposes as an initial theoretical and methodological platform for the meaningful disclosure of political investment as a category of political science analysis the classical concept of corporation, which is historically linked to the concept of civil society. The central idea that political investment expresses is the mediation of private and public interests.

Business attraction in the Mekong Delta region of Vietnam: The impact of the provisional competitiveness index and public policy

Over the course of many years, the Mekong Delta region has experienced relatively low and inconsistent levels of business attraction and low quality of the enterprise environment compared to other regions in Vietnam. To delve into whether this discrepancy reflects a negative perception of the business environment in the area, this study employs a dataset comprising the aggregate Provincial Competitiveness Index (PCI) and nine of its component scores, alongside other significant control variables, to analyze business attraction trends spanning from 2010 to 2020. It based on the modeling analysis for the panel data that includes Pool-OLS, FEM and REM models. The findings indicate that PCI serves as an important indicator influencing the quality of the business environment and plays a role in determining the location preferences of businesses. It is observed that public investment has exerted an impact on enticing new businesses to the region throughout this period. These research outcomes carry several policy implications, suggesting that public policy interventions can positively shape the business environment, consequently bolstering the appeal of business investments in the region.

Un análisis desagregado de la inversión empresarial desde el inicio de la pandemia

Rationale Business investment in Spain has proven considerably weak in recent years and is still below pre-pandemic levels. This article analyses investment dynamics in Spain until 2022 drawing on firm-level data from the Banco de España Central Balance Sheet Data Office. Takeaways •The disaggregated data from the Central Balance Sheet Data Office can be used to identify the characteristics of the firms that adjusted their investment patterns the most from the outbreak of the pandemic until 2022. •In this period, firms’ investment decisions became more sensitive to their economic situation (proxied here by their sales and cash flow). •Conversely, the link between firms’ investment decisions and financial position (proxied here by their debt level and debt burden) remained unchanged. •Investment by young firms proved particularly weak in the period analysed, and this led to a narrowing of the positive gap between their investment drive and that of other firms.

Profiling dan pemetaan riset innovation ambidexterity melalui pendekatan bibliometrik

This study aims to provide a comprehensive picture of current conditions and future research potential in innovative ambidexterity research. To achieve this goal, this study uses a bibliometric approach, the data sources used are secondary data sources, where the data used is in the form of 81 research articles taken in the Scopus database. In addition, selected articles are published by well-known publishers, namely Elsevier, Inderscience Publishers, Springer, Emerald, Routledge, Cogent, and Sage Publications. The results of the co-occurrence analysis and thematic map outline various emerging research topics in its clusters. Dimanqa cluster 1 covers issues such as Construction Industry, Corporate Social Responsibility, Environmental Innovation, Finance, Functional Laterity, Hemispheric Dominance, Human Resources Management, Management Practice, Manufacturing, Microfoundation, Open Innovation, Performance, Social Capital, and Sustainability. Cluster 2 raised topics such as business development, competitiveness, digital transformation, information management, information processing, innovation performance, investment, marketing, organizational framework, performance assessment, regression analysis, social network, and sustainability development. Meanwhile, cluster 3 highlights The third cluster consists of empirical analysis, entrepreneurial orientation, exploitation, exploration, industrial performance, intellectual capital, pharmaceutical industry, strategic entrepreneuship, technological development. The fourth cluster consists of business performance, dynamic capabilities, enterprise resource management, industrial management, information analysis, knowledge management, knowledge transfer, least squares approxima, radical innovation. Meanwhile, the fifth cluster consists of connectedness, decision making, environmental dynamis, firm performance, knowledge management, technological innovation, top management team. The sixth cluster consists of absortive capacity, business process performance, exploitative innovation, exploration innovation, and Small Medium Enteprise. And, the seventh cluster consists of competitive intensity. Future research themes in the realm of innovation ambidexterity can be presented or connected with strategic entrepreneurship, exploitative innovation, digital transformation, and innovation performance.

Calculating the Effectiveness of Corporate Social Innovation (CSI) using the Social Return on Investment (SROI) Method: The Fisherman Community Empowerment Program

PT Pertamina Lubricants is a subsidiary of the Indonesian state-owned oil and gas company Pertamina. The company has three production facilities located in Jakarta, Cilacap, and Gresik. PT Pertamina Lubricants Production Unit Cilacap is committed to implementing environmental and social responsibility well through Corporate Social Innovation. The programs are closely related to implementing sustainable development, which focuses on environmental issues and includes two other aspects: economic and community empowerment (People, Profit, and Planet). One of the programs specifically targets fishermen groups, called Pertamina Sahabat Nelayan (Pertamina Friends of Fishermen), an empowerment program by PTPL in Cilacap, using the Return On Investment (SROI) method. SROI is a method used by companies to measure the return on business investment for a program or social activity organized using a financial quantification (monetization) calculation approach. Data collection was obtained through in-depth interviews with members of fishermen groups in Tambakreja Village, the local government, beneficiary communities, and other stakeholders. The SROI calculations show that the Pertamina Friends of Fishermen program has created excellent value. With Pertamina’s investment, Pertamina Lubricants Production Unit Cilacap’s program has positively impacted society. This is indicated by the SROI ratio in the program’s first year, which resulted in an SROI ratio of 1:3.59.

Potentials and challenges of artificial intelligence-supported greenwashing detection in the energy sector

Fossil fuel actors have been using greenwashing strategies to enhance their public image by making ‘green’ and ‘sustainable’ claims, which can be misleading for the investing public. This is particularly concerning as it can lead to the unwitting investment in carbon-intensive businesses and investments. The challenge lies in verifying the accuracy of environmental practices due to the vague language used in environmental reporting and disclosures. This Perspective proposes the use of Artificial Intelligence (AI)-supported greenwashing detection tools to help identify and scrutinise greenwashing practices, especially through web scraping, natural language processing, and life cycle assessments to assess the claims made in environmental reports and disclosures using examples from three cases to detect deceptive practices and promote transparency in the industry. However, for AI to be effective in detecting greenwashing practices, it is essential to have trustworthy and readily available databases, as well as human expert involvement to check for any biases in the AI's analysis.

Influence of Political Risk on International Business Operations in Germany

Purpose: The aim of the study was to investigate the influence of political risk on international business operations in Germany. Methodology: This study adopted a desk methodology. A desk study research design is commonly known as secondary data collection. This is basically collecting data from existing resources preferably because of its low cost advantage as compared to a field research. Our current study looked into already published studies and reports as the data was easily accessed through online journals and libraries. Findings: The study revealed that political uncertainties, such as shifts in government policies, geopolitical tensions, and regulatory changes, can significantly impact the business environment, investment decisions, and market opportunities in Germany. While Germany is known for its stable political system and business-friendly environment, recent developments, such as Brexit, global trade tensions, and the rise of nationalist movements, have introduced new layers of complexity and uncertainty for international businesses operating in the country. These political risks can manifest in various forms, including disruptions to supply chains, fluctuations in currency markets, and heightened regulatory scrutiny, necessitating proactive risk management strategies and adaptive business practices. Unique Contribution to Theory, Practice and Policy: Institutional Theory, Resource Dependence Theory (RDT) & Transaction Cost Economics (TCE) theory may be used to anchor future studies on influence of political risk on international business operations. Implement regular political risk assessments using this comprehensive framework to identify potential threats and opportunities in different regions. Businesses should use advanced analytics and scenario planning to forecast potential political changes and their impacts. Businesses should diversify their investments across multiple countries and regions with varying political risk profiles. Policymakers should establish standardized guidelines for political risk assessment to ensure consistent and accurate evaluation across industries and regions. This will help firms better prepare for and mitigate political risks.