Journal of Business Administration

E-COMMERCE LANDSCAPE IN BANGLADESH: A CROSS-COUNTRY ANALYSIS

2024-06-22T10:01:45+00:00

In Bangladesh, millions of people now have access to the internet. This enables huge growth opportunity for both B2C and B2B e-commerce in the country. But the role of the internet in trade and commerce is still inadequate. Some other countries, which have started using internet at the same time period as Bangladesh, have progressed a lot in the field of e-commerce adoption whereas, Bangladesh is still lagging behind. Therefore, this study focuses on analyzing the current e-commerce adoption of the nation in comparison with some selected countries. To measure the position of Bangladesh, data were collected from secondary sources to make a comparison using three established indices. An FGD, composing e-commerce industry experts, was conducted to discuss and finalize the findings. The study found that, in almost all the indicators, Bangladesh’s position is lower than most of the countries compared (either lowest or second lowest). The research also found factors, such as, poor infrastructure, digital divide, low internet security, lack of awareness, poor service delivery, etc., that obstruct achieving the expected growth in e-commerce. Thus, the study sets the foundation for future researches to be done in the field of e-commerce adoption in Bangladesh.

INVESTMENT IN A SUSTAINABLE FUTURE: TARGETING INCLUSIVE HUMAN DEVELOPMENT WITH FISCAL ALLOCATION IN EDUCATION IN SOUTH-ASIA

2024-06-22T10:53:28+00:00

We examine the impact of public expenditure on education on human development measured by the United Nations Development Programme (UNDP) Human Development Index (HDI) in South Asia. Using country-level data for 32 years from 1991 to 2022 on ten South Asian nations, we estimate fixed effect panel data regression. We find that a 1 percentage point increase in government expenditure in education– measured as a % of GDP– is associated with a 0.01515 increase in HDI for the ten countries during the study period. Considering HDI on a scale from 0 to 1, this is indeed substantial. Additionally, we find a statistically significant and positive association between the number of primary and secondary educators and higher HDI scores. This positive association is also found for training of teachers. Results are stronger for primary level in case of number of teachers. In secondary level, results are stronger for training of teachers. Although the literature explores the topic in detail, empirical evidence in South Asia, particularly for Bangladesh, is inadequate. We believe our findings will inform better fiscal resource allocation in education in Bangladesh.

IMPACT OF MACROECONOMIC VARIABLES ON STOCK MARKET PERFORMANCE: EVIDENCE FROM DHAKA STOCK EXCHANGE

2024-06-22T10:19:44+00:00

Understanding the effect of overall macroeconomic variables on stock prices is fundamental to the development of proper financial markets. This study looks into the interrelationship between major macroeconomic variables and stock market performance and attempts to corroborate empirical evidence from developed and developing markets by collecting data on five relevant macroeconomic factors from Bangladesh and performance data from Dhaka Stock Exchange (DSE) – Bangladesh’s primary stock market, for the period of July 2010 to December 2021. The overarching hypothesis was that in a reasonably mature stock market operating in a fast-growing economy, inflation rate, foreign exchange rate, broad money supply, foreign currency reserves, and medium-term government bond rates will have a quantifiably significant impact on stock market movements and can be modelled for better understanding and future market predictions. Accounting for normality and stationarity patterns, Autoregressive Distributed Lag Model (ARDL) was found as a reasonably good fit for the data observed. DSE stock returns were found to be negatively significantly affected by inflation rate and broad money supply (M2), while positively significantly impacted by foreign currency reserves. Subsequently, Vector Auto Regression (VAR) showed that these variables have no long-term effect on stock performance, which was confirmed by the Granger Causality Test as well. The findings are consistent with similar studies in developed and developing markets worldwide.

CROSS-SECTIONAL HERDING BEHAVIOR IN DHAKA STOCK EXCHANGE : A CASE OF BEHAVIORAL FINANCE

2024-06-22T10:57:12+00:00

This paper aims at exploring the herding behavior in Dhaka Stock Exchange (DSE) Ltd. Cross Sectional Standard Deviation (CSSD) and Cross Sectional Absolute Deviation(CSAD) approaches proposed by Christie and Huang (1995) and Chang et al. (2000) were undertaken to identify herding behavior or individual irrationality in investment decision making process in DSE. Exploring the models proposed by Christie and Huang (1995) and Chang et al. (2000), the author proposed the use of an alternative non-linear model which can better reflect the market volatility and uncertainty of Bangladesh stock market. Daily closing price data of DSE 30 has been used for the study period of 2013-2023. DSE 30 was used as the market portfolio measure as this index includes the most liquid, active and investable stocks. Daily closing price data of DSE 20 was used for 2007-2012 period as DSE 30 was launched in 2013. The daily closing price data of individual stocks of DSE 30 index were taken after adjusting for right offerings, cash dividends and stock dividends. The test results broadly found herding behavior in different cross sectional analysis and different market conditions in different time phases. Herding behaviors were evident during 2007-2023 period during phases of large price movements, pre-crash period from 2007-2010, stock market crash period from 2010-2011, pre-COVID period from 2012-2019, COVID period from 2020-2021 and post-COVID period from November 2021-June 2023. From the test results, it can also be concluded that herding behavior is more prominent in small and medium capitalized portfolio, high and moderate trading volume scenario and in bullish and bearish market whereas the herding behavior is not evident in large capitalized portfolio, low trading volume scenario. These tests gave better results with the non-linear models as market does not necessarily maintain a linear correlation with individual or portfolio return dispersion. This paper contributes to the behavioral finance literature by applying an alternative non-linear model to detect irrational behavior of investors of emerging and frontier market like Bangladesh.