bluuebunny/crossref_metadata_2025 huggingface dataset:
Black economic empowerment in the Eastern Cape automotive industry: Challenges and policies
Authors: Horn GS
Published: April 2017

Original Equipment Manufacturers (OEMs) in South Africa are under pressure to meet the Black Economic Empowerment (BEE) policies and charters of the South African government by giving BEE suppliers additional opportunities to tender. However, many BEE suppliers, due to being historically disadvantaged, experience various problems which make it difficult for them to win tenders, including lack of finances, opportunities to tender and management and business skills, and problems with quality and capacity. This paper outlines these practical problems experienced by BEE suppliers, the effects of these problems on risk and complexity in the South African automotive industry and policies that address these problems and assist BEE suppliers to become A-rated suppliers. Data for the paper was obtained from interviews with: senior employees of the AIDC involved with supplier development training; middle managers of supplier quality and development departments at the three OEMs in the Eastern Cape Province; and BEE and small suppliers identified to undergo AIDC training. The findings of the study are that unless sufficient training is given to BEE and potential BEE suppliers, supply to OEMs will remain in the hands of existing established suppliers and very little transformation will occur within the automobile industry in South Africa.
Examining the ethical predisposition of the next generation of business leaders in China and the Republic of South Africa
Authors: Fullerton Sam , Bisschoff Christo , Moore David L
Published: April 2017

This study was undertaken in an effort to determine the attitudes of business students in South Africa and China toward a battery of questionable actions undertaken by anonymous business entities.  In general, practices such as the outsourcing of labour and celebrity endorsements met with little opposition on the part of the students.  Conversely, actions such as the shipment of unsafe products to overseas markets and a doctor smuggling a potentially beneficial (but illegal) drug across international borders in an effort to help a patient were strongly condemned.  A comparison of the means of the 14 scenarios resulted in statistically significant differences for the two countries on eight of the questionable actions.  In seven of the eight, the South Africans exhibited stronger opposition (or a lower level of support for) the behaviour of the organization.  Furthermore, the grand means for the two countries also favored the RSA as the country with the higher ethical predisposition.
Bank lending, expenditure components and inflation in South Africa: assessment from bounds testing approach
Authors: Ziramba Emmanuel
Published: April 2017

This empirical study examines the long-run relationship between inflation and its determinants in South Africa. Three models of inflation involving money supply, bank credit and expenditure components are tested using the unrestricted error correction models of Pesaran et al. (2001). Unlike other existing studies on the subject, one of the models in the present study considers various components of real income as determinants. The disaggregated components are final consumption expenditure, expenditure on investment goods and exports. Based on ‘bounds’ testing, the presence of a long-run equilibrium relationship between inflation and its determinants is confirmed for all three models. The study found that the major causes of inflation in South Africa are import prices, real income, and final consumption expenditure. The relationship is elastic for import prices and final consumption expenditure. Monetary variables, money supply and bank credit are found to have an indirect effect on inflation.
Measuring excessive pricing as an abuse of dominance – an assessment of the criteria used in the Harmony Gold/Mittal Steel complaint
Authors: Das Nair Reena
Published: April 2017

The Competition Tribunal recently found Mittal Steel SA guilty of abusing its super-dominant position by charging excessive prices to the detriment of consumers of flat carbon steel products. This article assesses the economic tests to be used for excessive pricing in light of the case and reviews the lessons that can be learned from the evidence required for the different tests. It discusses issues related to using profitability as a test and points out problems and pitfalls in profitability measures.
Has the conduct-based approach to competition law in South Africa led to consistent interpretations of harm to competition?
Authors: Hawthorne Ryan
Published: April 2017

The Competition Act and certain recent decisions by the competition authorities are examined here to assess the extent to which South Africa’s conduct-based approach to competition law has led to consistent outcomes in the assessment of effects on competition. This has not been the case in the assessment of anti-competitive effects among customers or resellers when a supplier accused of an anti-competitive action does not compete with its customers. An anti-competitive effect among customers or resellers is treated as anti-competitive when it arises from some form of conduct, such as price discrimination. However, it is not seen as anti-competitive when it arises from a refusal to supply, for example. Possible reasons for South Africa’s conduct-based approach and this inconsistent outcome in the assessment of competition among customers and resellers, including the economic foundations of the relevant approaches and their relationship with competition law in other jurisdictions, are assessed.
The impact of post-merger cross-shareholdings on South African merger control policy
Authors: Charter Chris
Published: April 2017

There is a concentration of EU and US standards in the South African economy. In addition, a number of large industries have been undergoing consolidation. As a result, the phenomenon of cross-holdings, both within and across industries, is not unusual. In cases where the level of cross-holding falls short of joint control, the competition authorities have at times sought to apply the co-ordinated effects doctrine or some variation thereof hoping to lessen potential competition. More recently, the Tribunal has also considered the possible unilateral effects of the acquisition of a minority stake in a rival. A number of cases has emerged that to a greater or lesser degree explores the impact of crossholdings and cross-directorships on the competitive behaviour of the firms concerned. This paper includes a review of some of these decisions with a view to determining whether any clear policy seems likely to emerge from the competition authorities. The authorities’ approach to date, reveals an evolution from reflex suspicion to a more reasoned, fact-based outlook. Cross-holdings and directorships are treated in the same way as any other evidence relevant to an analysis of a given merger. However, despite the Tribunal’s willingness to wrestle with various economic theories, the most recent decision suggests that the acquisition of a non-controlling cross-holding in a company may not fall under the analysis of South African merger regulation at all. Should that position change, following clarification by the Tribunal or an unequivocal ruling of the Competition Appeal Court, the body of case law goes some way to indicating the type and manner of analysis the authorities will employ.
Characterising price fixing: a journey through the looking glass with ANSAC
Authors: Moodaliyar Kasturi , Weeks Keith
Published: April 2017

In February 2005 the Supreme Court of Appeal of South Africa ruled that in deciding whether firms have contravened section 4(1)(b) of the Competition Act 89 of 1998, as amended, by engaging in, for example, ‘per se’ illegal price fixing, the Competition Tribunal must admit evidence relating to the nature, purpose and effect of the horizontal agreement or practice in question. This article examines the economic and legal rationale, as well as the implications, for allowing an appropriate characterisation of conduct to determine whether such conduct falls within the per se prohibition. Firstly, we comment on the rationale behind the per se rule as a standard for the adjudication of certain types of conduct. We analyse a number of cases in the United States, which, post 1979, revolutionised the approach to the strict per se rule. Secondly, we examine how the per se standard is reflected in the particular structure found in section 4(1) of the Competition Act and evaluate whether it makes for a sufficiently robust application of the per se rule. Thirdly, the content of the Supreme Court decision regarding characterisation is critically examined with a view to assessing whether such characterisation is consistent with the policy objective of achieving maximum deterrence of hard core cartel behaviour like price fixing and market division. Finally, we explore and suggest (in the absence of a Tribunal decision) a possible framework, based on decision theory, for determining a method of characterisation that is consistent with the robust application of the per se standard and is in line with the Supreme Court ruling.
Critical variables of business failure: a review and classification framework
Authors: Pretorius Marius
Published: April 2017

Failure is a phenomenon that ventures face during all stages of the life cycle and requires insight into its causes before it can be reversed. The scientific literature on failure is, however, spread over multiple disciplines. This study’s line of enquiry firstly reviews the documented research (both theoretical and empirical) encompassing the phenomenon ‘business failure’ on a multi-disciplinary basis. A conceptual framework is then proposed for categorising variables into four sub-domains namely: signs and prediction; causes and preconditions; recovery; and cognition and learning. Better understanding of the failure phenomenon is achieved. The methodology applied is fundamentally based on grounded theory interpretation with a focus on classifying the identified relevant variables.
Primary commodity export and economic growth in sub sahara africa: evidence from panel data analysis
Authors: Ocran Matthew , Biekpe Nicholas
Published: April 2017

The paper sought to examine the impact of instability in primary commodity export earnings and the level of commodity dependence on economic growth in Sub Saharan Africa (SSA).  Fixed effects panel data estimator was used in the empirical estimation. The findings of the study suggest that there is a negative relationship between instability in export earnings and economic growth. The results also indicate that the level of commodity dependence matter in determining economic growth in the region. The results of the paper have economic development policy implications for SSA economies and these are not farfetched. First, it appears the difficult growth experience of SSA is not solely due to instability in export receipts. The question of continued dependence on a narrow range of primary commodities is also matter of great importance.
Theory building trends in international management research: an archival review of preferred methods
Authors: Kriek Drikus , Beaty David , Nkomo Stella
Published: April 2017

A number of distinguished scholars believe that for theory development to occur within a field, qualitative research must precede quantitative research in order for the field to progress toward maturity. The purpose of this study was to investigate the international management literature from 1991-2007 to ascertain current levels of use of qualitative, quantitative, conceptual and joint (quantitative and qualitative) research methods in the field.  Results indicate scholars employ quantitative methods more than qualitative methods.  The implications of these findings for future theory development and the generation of context relevant international management knowledge are discussed.
Measuring the welfare cost of inflation in south africa: a reconsideration
Authors: Gupta Rangan , Uwilingiye Josine
Published: April 2017

In this paper, using the Fisher and Seater (1993) long-horizon approach, the writers estimate the long-run equilibrium relationship between money balance as a ratio of income and the Treasury bill rate for South Africa over the period 1965:02 to 2007:01, and, in turn, use the obtained estimates of the interest elasticity and the semi-elasticity to derive the welfare cost estimates of inflation, using both Bailey’s (1956) consumer surplus approach and Lucas’ (2000) compensating variation approach. When the results are compared to welfare cost estimates obtained recently by Gupta and Uwilingiye (2008), using the same data set, but basing it on Johansen’s (1991, 1995) cointegration technique, the values are less than half of those obtained in the latter study. These range from 0.16 percent to 0.36 percent of GDP for the target-band of three percent to six percent of inflation. The paper thus highlights the fact that welfare cost estimates of inflation are sensitive to the methodology used to estimate the long-run equilibrium money demand relationships.
Corporate social responsibility: the financial impact of black economic empowerment transactions in South Africa
Authors: Wolmarans Hendrik , Sartorius Kurt
Published: April 2017

Corporate social responsibility (CSR) has recently received considerable attention in literature. One of the vehicles by which companies can conform to CSR in South Africa is Black Economic Empowerment (BEE). In this regard, BEE has been employed to assist previously disadvantaged groups of investors obtain a larger share of the equity of South African listed companies. The question has often been asked whether the announcement of BEE transactions by listed companies increases shareholder wealth. This article tries to answer this question by examining the share performance of 125 BEE transactions involving 95 companies during the period January 2002 to July 2006. The results indicate a positive relation between BEE transaction announcements and shareholder wealth creation, but only during the last part of the period covered by the study.
Core corporate governance dilemmas facing boards: a South African perspective
Authors: Serretta Hyram , Bendixen Mike , Sutherland Margie
Published: April 2017

Directors and boards face many challenges in terms of managing complexity. A key factor of success in practicing good corporate governance is the board’s ability to cope with paradox. The purpose of this research has been to explore the core corporate governance dilemmas facing boards. The investigation was qualitative in nature using the Delphi technique. Six core corporate governance dilemmas facing board members were identified one of which is not mentioned in the international literature. The findings should provide directors with an ability to identify the nature of the paradoxes they need to respond to.
Who would eat more with a food voucher programme in South Africa?
Authors: Van Heerden Jan Horn
Published: April 2017

A Computable General Equilibrium model is used to find the effects of a food voucher scheme on the economy in South Africa. If firms consider the issuing of vouchers as increased remuneration, they will hire fewer labourers. The higher labour cost increases the total cost of production and lowers supply. Real Gross Domestic Product decreases and the economy becomes worse off.  However, depending on the size of the government’s involvement in such a scheme as well as the tax policies that are used to fund it, a food voucher scheme could benefit the poor, and improve the distribution of wealth in the country.
The general equilibrium effects of a productivity increase on the economy and gender in South Africa
Authors: Chitiga-Mabugu Margaret , Kinyondo Godbertha
Published: April 2017

This study utilises a computable general equilibrium model to examine the effects of economy-wide (SIM 1) and partial (SIM 2) productivity increases on the economy, gender employment, wages, income and welfare in South Africa. SIM 1 results in ‘output’ led employment demand and increased earnings for all skill types of men and women. Skilled men benefit more than others in most sectors. Under SIM 2, productivity has a negative employment impact in the selected sectors, on all skills mostly in labour-intensive sectors. In general, productivity improves households’ welfare due to reduced commodity prices and improved earnings. If productivity rises only in men-intensive sectors, men’s wages rise while raising productivity in only women-intensive sectors affect women negatively.
On merger simulation and its potential role in south african merger control
Authors: Mncube Liberty , Ratshisusu Hardin , Dlamini Bheki
Published: April 2017

This paper simulates the price effects of the proposed Ferro Industrial Products (Ferro) and Powder-Lak merger in order to suggest the role that merger simulation models should play in South African merger control. Merger simulation can provide support to the Commission’s analysis by; focusing parties’ attentions on verifiable economic arguments; making transparent the values of the key parameters and assumptions in the Commission’s analysis; producing quantitative estimates of the results of a given transaction; and indicating the amount of resources to allocate to proposed merger cases. However, it offers only one piece of evidence in a case and its results must be interpreted with an understanding of the potential limitations.
Capital budgeting practices used by selected listed South African firms
Authors: Hall John , Millard Solly
Published: April 2017

This article investigates the application of capital budgeting techniques and the incorporation of risk into the capital budgeting process among a sample of South African industrial firms listed on the JSE Securities Exchange for at least ten years. Previous international and local research on this topic indicated a preference for the internal rate of return (IRR) as a capital budgeting method over the net present value (NPV), and that risk incorporation was relatively rarely incorporated into the capital budgeting process. The results of this study indicate that the NPV is just as popular as, and sometimes more so than, the IRR. Furthermore, compared to previous studies, risk is incorporated into evaluating capital budgeting projects more often. Sensitivity analysis is the most popular method, but adjustments to the cash flows and discount rate are becoming more popular. During the last decade the use of non-financial criteria to accept or reject a project has also increased in South Africa.
Accounting ethics – an empirical investigation of managing short-term earnings
Authors: Jooste Leonie
Published: April 2017

Short-term earnings are managed in most, if not all, companies. The management of short-term earnings is vulnerable to misinterpretation, manipulation or deliberate deception even if these misleading accounting practices are prohibited by accounting regulations. Hence, the problem with managing short-term earnings is that it becomes an ethical practice, regardless of who is or may be affected by the practice or the information that flows from it. As a result of the publicity received by Enron and WorldCom on financial failures and fraud, and the subsequent legislation, the Sarbanes-Oxley Act in 2002, students are expected to understand the morality issues of earnings-management practices. Therefore, the ethics of earnings-management practices affects the accounting educator. Accounting students and business managers were surveyed and the findings indicated that there is no significant difference between gender regarding the ethicality of twenty earning management practices. The results, however, show that there is a significant difference between the perceptions of business managers and students regarding the morality of earnings-management practices. However, no significant differences were found between genders.
Chief information officers: an empirical study of competence, organisational positioning and implications for performance
Authors: Cohen Jason , Dennis Claire M
Published: April 2017

The role and contribution of the firm’s Chief Information Officer has been the subject of much debate and uncertainty. Yet, too few empirical studies have examined the implications of the CIO role. This study examined the effects of CIO demography, CIO competencies as well as CIO organisational positioning on the contribution of information systems (IS&T) to business performance. Data was collected from 111 South African companies and results revealed that CIO business, interpersonal/political and technology management competence have significant direct effects on the dependent variable. The effect of CIO organisational position, including structural power and political relationship, was found to be mediated by CIO competence. CIO work experience also impacted the contribution of IS&T. Results have important implications for our understanding of the competencies and organisational positioning required of executives charged with the responsibility for information systems and technology management.
Labour conflict and the persistence of macro underemployment in South Africa
Authors: Schoeman Christie , Botha Ilze , Blaauw Philip F
Published: April 2017

Something must be structurally wrong in a labour market when a well developed economy like that of South Africa is not able to absorb and allocate an accumulating surplus of labour over a period of 20 years or longer but has instead  moved to the use of more capital-intensive technology. The objective of this paper is to analyse the role labour conflict plays in the persistence of macro underemployment in South Africa. For the analysis two models identified from the literature were used. In these models labour conflict originates from an over-regulated labour market where labour appropriates capital and bad or hostile labour relations. In both models the switch to technology leads to underemployment. It was found that bad labour relations contribute to the persistence of underemployment in South Africa.
Major dealers' expert power in distribution channels
Authors: Chinomona Richard , Pretorius Marius
Published: April 2017

The importance of major dealers’ expertise in distribution channels and effects on exchange relations is widely acknowledged by many SMEs in Africa and yet there seem to be a paucity of research on this matter. To address this dearth, the current study attempts to examine the impact of major dealers’ expert power on SME manufacturers’ channel cooperation and the mediating influence of their trust, relationship commitment and satisfaction. The conceptualized model and five hypotheses are empirically validated using a sample of 452 manufacturing SMEs in Zimbabwe. The findings indicate that major dealers’ expert power may influence SME manufacturers’ trust, relationship commitment, relationship satisfaction and channel cooperation in a significant way. Managerial implications of the research findings are provided.
Does capital gains tax add to or detract from the fairness of the South African tax system?
Authors: Maroun Warren , Turner Magda , Sartorius Kurt
Published: April 2017

This research seeks to add to the existing body of knowledge on the perceived impact of Capital Gains Tax (CGT) on the fairness of the South Africa Tax System. Building on the largely qualitative work done by Vivian (2006) and Smith (1776), this research makes use of an extensive literature review followed by a correspondence analysis to complement the existing body of research into this area. The literature review discuss the fairness criteria advanced by Smith (1776) (Smith’s tax canon) and identify ‘unfairness characteristics’ of CGT.  The correspondence analysis only tests the theories advanced in the literature review and revealed that there are potential sources of unfairness inherent in the Eighth Schedule to the Income Tax Act No. 58 of 1962 (the Eighth Schedule). These include the possibility that that CGT gives rise to double tax and imposes a high burden on taxpayer’s ability to bear the tax load.
Firm age, collateral value, and access to debt financing in an emerging economy: evidence from South Africa
Authors: Ezeoha Abel , Botha Ferdi
Published: April 2017

This paper applies the Blundell and Bond system generalised method of moments (GMM) two-step estimator to examine the impact of age and collateral value on debt financing, using a panel of 177 non-financial companies listed on the Johannesburg Stock Exchange over the period 1999 to 2009. The results show that South African firms have target leverage ratios and adjust their capital structures from time to time to achieve their respective targets, that the relationship between firm age and debt financing is non-monotonic, and that firms with higher collateral value are likely to face fewer constraints on borrowing and therefore have greater access to medium-term and long-term debts. Robustness tests also reveal that during start-up and maturity stages, a firm’s access to debt markets is significantly influenced by investments in assets that are acceptable to external creditors as collateral. These findings suggest that debt financing policies could be more critical for firms in the start-up and maturity stages.
Can listed property shares be a surrogate for direct property investment behaviour?
Authors: Boshoff Douw , Cloete Chris E
Published: April 2017

The listed property sector in South Africa has grown to a size which could be considered to be a good representation of the income producing property market in general. Stock market listed property investment funds offer the opportunity to compare indirect property investment to direct property investment, which could bridge the gap between irrational investment behaviour and intrinsic asset values. This study investigates the relationship between listed property share prices and the property values in listed property funds. The share prices are correlated with various factors, such as the accounting ratios of the companies, the financial statements of the companies and general economic variables. The outcome of the study is an explanation of the behaviour of listed property shares, and its relationship to the direct property market and the general economy. This would assist in the explanation of market behaviour and provides the opportunity to more accurately predict portfolio asset values, which might be used in the valuation of individual real estate assets.
On employees’ performance appraisal: the impact and treatment of the raters’ effect
Authors: Zewotir Temesgen
Published: April 2017

By putting in place a performance appraisal scheme, employees who improve their work efficiency can then be rewarded, whereas corrective action can be taken against those who don’t. The aim of this paper is to develop a technique that helps to measure the subjective effect that a given rater’s assessment will have on the performance appraisal of a given employee, assuming that an assessment of one’s work performance will have to be undertaken by a rater and that this rating is essentially a subjective one. In particular, a linear mixed modelling approach will be applied to data that comes from a South African company which has 214 employees and where an annual performance evaluation has been run. One of the main conclusions that will be drawn from this study, is that there is a very significant rater’s effect that needs to be properly accounted for when rewarding employees. Without this adjustment being done, any incentive scheme, whether its motive  is reward based or penalty based, will ultimately fail in its intended purpose of improving employees’  overall performance.
Fiscal regime changes and the sustainability of fiscal imbalance in South Africa: a smooth transition error-correction approach
Authors: Jibao Samuel , Schoeman Niek , Naraidoo Ruthira
Published: April 2017

In addition to the conventional linear cointegration test, this paper tests the asymmetry relationship between fiscal revenue and expenditure, by making a distinction between the adjustment of positive (budget surplus) and negative (budget deficit) deviations from equilibrium. The analysis uses quarterly data for South Africa. The paper reveals that government authorities in South Africa are more likely to react more quickly when the budget is in deficit than when in surplus, and that the stabilisation measures used by government are fairly neutral at low deficit levels; that is, at deficit levels of 4 per cent of GDP and below. We conclude that the assumption that adjustment towards equilibrium is always present and of the same strength under all circumstances, is not valid in the case of fiscal data on South Africa; and that that fiscal sustainability in South Africa has been attained at the expense of a reduction in the ratio of expenditure to GDP on education, and a relatively constant ratio of expenditure to GDP on health. The paper noted that a priori one would expect that such a decline in the allocations to sectors which could stimulate growth and which in turn could generate future revenue, may pose a threat to the accumulated fiscal space. In South Africa the main fiscal challenge, therefore, is to find ways through which the recent gains in fiscal solvency can be consolidated.
The regulatory treatment of liquidity risk in South Africa
Authors: Jacobs Johann
Published: April 2017

The Basel accord describes the regulatory capital requirements for credit, market and operational risk. The accord aims to provide guidelines to level the playing field for all internationally active banks and to protect consumers against these risks. Despite the growing significance to bank solvency of liquidity risk, it is omitted from the new accord2. Banks are not required to measure and manage this risk yet they are often considerably exposed to the threat of severely diminished liquidity. This omission from the accord could have dire consequences for banks and the economy in which they operate: liquidity crises can occur without warning and spread quickly to other parts of the financial system. This article critically explores current practices in South Africa and proposes guidelines for effective liquidity risk regulation.
Entrepreneurial attributes of undergraduate business students: a three country comparison revisited
Authors: Farrington Shelley , Venter Danie , Schrage Christine , Van der Meer Peter
Published: April 2017

In 2001/2002 a study was undertaken to establish whether significant differences existed between the levels of development of several entrepreneurial attributes, as perceived by undergraduate business students from three universities in three different countries. The rationale was that, if entrepreneurial attributes could be identified as more developed in one country than in another, solutions could be provided for developing these attributes in others. The primary objective of this study is to investigate and compare the levels of development of entrepreneurial attributes of undergraduate business students in the present study (2010) to the levels of development reported by undergraduate business students in the 2001/2002 study. Cronbach alpha coefficients were calculated to assess the reliability of the measuring instrument and ttests to establish significant differences. Cohen’s d statistics were calculated to establish practical significance. The findings suggest that the educational environment and entrepreneurship education policy of the Dutch university participating in this study could provide solutions as to how entrepreneurial attributes among students could be developed further.
Month of the year and pre-holiday effects in African stock markets
Authors: Alagidede Paul
Published: April 2017

This paper investigates the existence of two anomalies in African stock returns: the month of the year and the pre-holiday effects, and their implications for stock market efficiency. We extend the traditional approach to modelling anomalies and examine the mean and variance of returns. We document high and significant returns in days preceding a holiday in South Africa. Our results indicate that the month of the year effect is prevalent in African stock returns. However, we argue that, owing to illiquidity and round trip transactions costs, the anomalies uncovered do not necessarily violate the no-arbitrage condition.
An estimate of the recreational value of the Agulhas Plain, South Africa, with special reference to the value of plant biodiversity
Authors: Conradie Beatrice , Garcia Maria
Published: April 2017

The Agulhas Plain is a remarkable recreational site which combines the attraction of a pristine marine environment with exceptional plant biodiversity, rural tranquillity and the novelty of being at the southernmost tip of Africa. The resource is a public good to which the market cannot assign a full value. This paper presents an estimated recreational value based on individual travel cost models and a sample of 370 visitors surveyed in 2010. Trip demands were estimated with zero truncated negative binomial models to account for over-dispersion. The study established a recreational value of R2.167 billion in 2010 prices for the site as a whole. By partitioning the sample into visitors who indicated having been attracted or not to the area by its nature and biodiversity, a net biodiversity value of R2 866 per trip was calculated. Allocated between marine and terrestrial resources based on the proportion of activities related to each type of resource, the value of plant biodiversity was estimated to be R2 268 per hectare in 2010to 2010 prices.
The role of internal and external factors on management students’ subject choices
Authors: Coldwell David AL , Callaghan Chris W
Published: April 2017

The aim of the study is to investigate undergraduates’ perceptions of the comparative worth/utility of studying Business Science disciplines at a prominent South African University in terms of: (i) internal factors comprising aptitudes, values and interests; and (ii) external factors comprising job attractiveness (job prospects, earning potential, non-salary benefits and work-life balance), and (iii) university and discipline academic reputations. The study utilises a specifically designed instrument to measure internal and external factors impinging on career choice. A purposive non-random sample, consisting of 130 second and third year students in Human Resource Management (HRM) and Management, is used. Findings suggest that, while perceptions of aspects of careers, such as job and career prospects generally dominate the choice of major subjects, students studying HRM majors hold community orientated values that distinguish them from their peers. Many students are found to make choices primarily on the basis of their perceptions of ‘external factors’, rather than their interests. The findings are discussed in terms of extant theory and potential practical outcomes.
Measuring spill-over effects of foreign markets on the JSE before, during and after international financial crises
Authors: Heymans Andre , Da Camara Ricardo
Published: April 2017

There is a large body of research that proves the co-movement of international stock markets over time. This co-movement manifests through various instruments ranging from stocks and bonds, to soft commodities and can be visualised as returns and volatility spill-over effects. During the most recent financial crisis, it was once again highlighted that no market is immune to spill-over effects from other international markets. By employing an aggregate-shock (AS) model, returns and volatility spill-over effects of the Hang Seng, London, Paris, Frankfurt and New York stock markets to the JSE are confirmed. The findings also confirm the JSE All share index is directly affected through contagion by the returns of the economic area where the crisis originates. However, the results further confirm that South Africa has progressed in shielding its stock market against financial crises in recent times. These findings hold important implications for stock portfolio managers in South Africa.
Mixed methods research in the South African Journal of Economic and Management Sciences: An investigation of trends in the literature
Authors: Ngulube Patrick , Ngulube Beatrice
Published: April 2017

Mixed methods research (MMR), which is touted as a third methodological movement is increasingly becoming a popular approach in several fields as a result of the promise it holds to providing a better and balanced investigation of research problems in context. In spite of that, there is limited knowledge about its pervasiveness in economic and management sciences in South Africa. Based on a content analysis of 332 articles published in The South African Journal of Economic and Management Sciences from 2003 to 2011, the main purpose of this quantitative study is to explore the prevalence of MMR in SAJEMS. Although methodological advances have been made in the field of economic and management sciences as reflected in the articles in SAJEMS, the findings reveal that scholars employ quantitative and qualitative methodologies than MMR. Given the paucity of MMR in the field, this study underscores the potential benefits of embracing methodological pluralism as it offers methodological and theoretical benefits. First, the use of MMR provides the possibility for researchers to obtain a comprehensive picture of a phenomenon under investigation and achieve their research purpose effectively. Secondly, its utilisation may also contribute to theory development and the maturity of the field as reflected in SAJEMS.
Individual shareholders’ understanding of the content of interim reports of South African listed retail companies
Authors: Oberholster Johan GI , Koornhof Carolina , Vorster Quintus
Published: April 2017

A number of studies conducted, and reports published, by international and local accounting bodies have found that the proliferation of disclosures in financial reports has hampered users’ understanding of these reports. The reports by accounting bodies also indicate that these users prefer more concise financial reports. These findings, in conjunction with a dearth of recent questionnaire-based research on whether individual shareholders understand the content of financial reports, resulted in this study on whether individual shareholders understand the content of interim reports. The study provides empirical proof that a sound knowledge of business, accounting and economic matters is a prerequisite for understanding interim reports in the case of individual shareholders. The results of the study indicate that individual shareholders have a limited understanding of the content of interim reports as a whole, and that a good knowledge of business and economic matters and of accounting results in an improved understanding of the content of interim reports. In particular, specialisation in accounting in undergraduate and postgraduate degrees, professional qualifications, and work experience in the financial field improve the understanding of individual shareholders.
The relationship between leadership styles, innovation and organisational performance: A systematic review
Authors: Sethibe Tebogo Gilbert , Steyn Renier
Published: April 2017

This paper is an attempt to consolidate the published scientific knowledge about the impact of leadership styles on the relationship between innovation and organisational performance. Concepts, statements and conceptual frameworks were used as structure to analyse the body of scientific knowledge. After consulting 31 major research databases using the systematic literature review methodology, only seven journals articles that examined the link between leadership, innovation and organisational performance were identified. The synthesis of the journal articles revealed (a) that consensus exists among researchers as far as the relevant concepts are concerned; (b) that most agree on the definition of leadership and innovation but that a uniform understanding of what constitutes organisational performance is lacking; and (c) that conceptual models are too simplistic and do not consider mediator variables or multiple financial criteria measures. The findings further reveal that innovation is significantly and positively related to superior organisational performance, and that, although transformational leadership style is significantly and positively related to innovation, transactional leadership style is more appropriate when the aim is to instil a culture of innovation. Transformational leadership style, by contrast, is mostly associated with organisational performance. In addition, the findings further reveal that none of the studies investigate the mediating effect of the nature of innovation (incremental and radical) on the relationship between leadership and organisational performance, and that none of the studies use the objective measures of financial performance such as ROA, ROE, price/earnings (P/E) and Tobin’s Q calculated from annual financial reports.
Determining South Africa’s export potential to Australia: A panel data approach
Authors: Jordaan Andre Cillie
Published: April 2017

This study explores South Africa’s exports to Australia from 2000 to 2012, using both a static and a dynamic augmented gravity model. Sectors with export potential are identified, whether these are reliable and stable is considered. The largest export potential includes the apparel sectors as well as the basic metals, communication, furniture, glass, iron, leather, motor, paper and printing sectors. The most stable and reliable export sectors are the motor, machinery, iron, basic chemicals and food sectors. Although these sectors could target the promotion of South African exports, South Africa could also serve as an important source country for Australia in strengthening ties with the African continent.
Focal point pricing: A challenge to the successful implementation of Section 10a (introduced by the Competition Amendment Act)
Authors: Holland Mike , Rossouw Jannie , Staples Jessica
Published: April 2017

The Competition Amendment Act introduced section 10A, which provides the Competition Commission with the powers to investigate complex monopoly conduct in a market and allows the Competition Tribunal, under certain conditions, to prohibit such behaviour. Although more than five years have elapsed since the Competition Amendment Act was promulgated, this provision has yet to come into force. However, when it eventually does so, it will mark a significant change in South African competition law, as it seeks to regulate firms’ consciously parallel conduct. This is coordinated conduct that occurs without communication or agreement, but results in the prevention or substantial lessening of competition. Examples of horizontal tacit coordination practices include price leadership and facilitating practices, such as information exchanges and price signaling. The successful implementation of the amendment poses problems for the competition authorities in assessing the competitive effects of complex monopoly conduct and in providing effective remedies. Oligopoly markets result in mutual interdependent decision-making by firms, which can lead to market outcomes similar to explicit collusion. However, a further and little noticed issue is that firms in oligopolistic markets have opportunities to use focal points to determine coordinated strategies. This paper explores the nature and role of focal point pricing, which can lead to prices that are above competitive levels. The South African banking industry is used as an example. We find that focal point pricing is difficult to control, making the successful implementation of section 10A even more problematic. Moreover, the proposed amendment provides scope for the imposition of structural remedies by the Competition Tribunal, a function that the Competition Tribunal is ill-suited to perform.
Assessing the potential impact of the Marikana incident on South African mining companies: An event method study
Authors: Hill Nicholas , Maroun Warren
Published: April 2017

This study examines the potential impact of industrial unrest and the outbreak of violence at Marikana on 16 August 2012 on the share prices of mining companies listed on the Johannesburg Stock Exchange (JSE) using an event methodology. Contrary to expectations, the Marikana incident does not appear to have had a widespread and prolonged effect on the South African mining sector. This may be the result of the strike action already having been discounted into the price of mining shares, implying that the market was only reacting to the unusually violent (but short-lived) protest. Alternately, the results could be indicative of investor confidence in the corporate social responsibility initiatives of the South African mining industry as a whole. This paper is the first to examine the potential impact of the Marikana incident on the share prices of mining companies listed on the JSE. It should be of interest to both academics and practitioners wanting to understand how share prices react to exogenous events. It is also relevant for corporate-governance researchers concerned with the relevance of social and governance practices in a South African setting. This research is faced with the limitations associated with most statistical research: that causality cannot be ascribed to tested relationships. Notwithstanding these limitations, it is argued that these findings are important, given the significant coverage of the Marikana incident and the ongoing debate on the need for corporate social responsibility.
Comparing the power and influence of functional managers with that of project managers in matrix organisations: The challenge in duality of command
Authors: Moodley Dylon , Sutherland Margie , Pretorius Pieter
Published: April 2017

Since its inception four decades ago, there has been widespread adoption of the matrix organisational design, particularly in project-based organisations. However, several challenges remain, one of which is related to the ambiguity of authority as a result of the dual command structure. This study examines the perceptions of the types of power and influence mechanisms used by the functional manager and the project manager to influence project personnel, and the effect of these mechanisms on attitudinal outcomes. The research used a two-phase design. The first qualitative phase validated the constructs of power and influence. In Phase 2, quantitative data was obtained from 22 functional managers, 28 project managers and 92 project personnel in South Africa, Italy and Canada from one large project execution technology company. There appears to be a large perceptual gap between project managers, functional managers and project personnel. Managers perceive themselves to be using aspirational and personal influence mechanisms, whereas project personnel perceive the managers to be using positional, punitive mechanisms. Relationships were observed between the perceived type of influence being used by the managers and the project personnel’s satisfaction with their manager, overall job satisfaction, their performance and level of engagement. Functional and project managers are associated with very different attitudinal outcomes among project team members.
Trading book risk metrics: A South African perspective
Authors: Van Vuuren Gary Wayne , Visser Dirk
Published: April 2017

The regulatory market risk metric – Value at Risk – has remained virtually unchanged since its introduction by JP Morgan in 1996. Many prominent examples of market risk underestimation have undermined the credibility of VaR, prompting the search for better, more robust measures. Expected shortfall and procyclical capital buffers have been proposed by regulatory authorities, but neither is without problems. Bubble VaR – a coherent measure which avoids many of the pitfalls to which other measures have succumbed – was designed to be both forward-looking and countercyclical. Although tested on other markets, here it is applied to various South African prices and the results compared with both international observations and other market risk measures. Bubble VaR is found to perform consistently and reliably under all market conditions.