Department of Economics and Banking

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Anti-Corruption Disclosure, Corporate Social Expenditure and Political Corporate Social Responsibility: Empirical Evidence from Bangladesh
(Sustainability, 2022-05-18) Masud, Md. Abdul Kaium; Rahman, Mahfuzur; Rashid, Md. Harun Ur
Corruption is a major concern globally, particularly in developing countries, such as Bangladesh, where it is the main obstacle to economic development. Corruption is also mentioned asthe major impediment to accomplishing sustainable development. There is a dearth of studies on anti-corruption disclosure (ACD), political corporate social responsibility (PCSR), and cash holding in Bangladesh magnitude of this research. This study investigates different drivers and motivations of ACD practice of a less control of corruption country’s firm-level observations. This study incorporates an institutional and legitimacy theoretical lens to explain anti-corruption disclosure practice. In order to draw the best picture of corruption disclosure, the study uses all financial sector companies listed on the Dhaka Stock Exchange. Therefore, the total firm-year observations are 245 from 2012–2016.The authors developed a diverse set of 97 keywords as content for ACD. The regression results show that CSR expenditures, political corporate social responsibility (PCSR), financial constraint, internationalization of reporting, and media visibility positively and significantly affect firm-level ACD. Furthermore, cash holdings show negative and significant relationships. The study provides new evidence on CSR expenditure, PCSR, cash holdings, and media visibility from a developing country’s perspective. Therefore, the results suggest that policymakers and regulatory authorities can deal with ACD as a legitimization tool for society and stakeholders.
Blue Economy of Bangladesh: Opportunities and Challenges for Sustainable Development
(Advances in Social Sciences Research Journal, Society for Science and Education, United Kingdom, 2018-08-25) Islam, Md. Khairul; Rahaman, Mahbubur; Ahmed, Zobayer
The blue economy refers to the economic activity based on maritime resources. The paper aims to explore the current scenario of sea resources of Bangladesh. Using secondary data, the study reveals that Bangladesh can accelerate its economic growth through the sustainable use of the sea resources. Moreover, Bangladesh has 710 km long coastline with 200 Nautical Miles of an exclusive economic zone inside the Bay of Bengal. Marine fisheries contribute 19.4% of the total fish production of the country. Besides, the western coastline of Cox’s Bazaar is the longest sea beach in the planet that is visited by on an average, 81% of the international tourists arrive in Bangladesh. However, due to lack of institutional capacity and given the socio-cultural context, the sustainability of the sea resources is now facing critical threats. Apart from studying the present status of sea resources, the paper proposed some way forwards based on existing opportunities and challenges for promoting sustainable development in Bangladesh
Causal Relationship Between Foreign Direct Investment And Capital Flight: A Case Study of Bangladesh
(Centre for Research on Islamic Management and Business, 2016-12) Uddin, Mohammed Jashim; Yousuf, Md.
The fundamental aim of this study is to investigate the relationship between Foreign Direct Investment (FDI) and Capital Flight (KF) of Bangladesh. To obtain the objective, this paper has conducted statistical analyses and examined time series data over a period of Forty one years from 1973 to 2014. Unit root test and Granger causality test were exercised to measure the relationship between independent variable (FDI) and dependent variable (KF). The results found in this paper signify a positive correlation between FDI and Capital Flight and may be a concern and significant for the government of Bangladesh. The government might focus on required reforms and policy implications to make foreign investment more beneficial.
The Causes and Consequences of Rural Urban Migration in Bangladesh : A Review of the Relevant Literature
(Centre for Research on Islamic Management and Business, 2017-06) Firoj, Mahamuda; Rosni, Bakar
This study aims at reviewing the existing theories and studies of rural urban migration which explore the causes and consequences of rural urban migration of a developing country like Bangladesh. According to most of the relevant studies of rural urban migration poverty, joblessness, homelessness, landlessness, economic degradation, mal adjustment of the community, river erosion and various natural calamities are the major push factors in migration process. Although pull factors are not so dominant, easy access of informal sector, higher income earning possibility, better service facilities, and bright city lights attracted people to make a settlement in the urban areas. Depending on reviewed document, the significant consequences of migration are crate employment and cash earning, enjoying some civic amenities, overcrowding, difficulties of waste disposal, shortage of housing, inadequate educational facilities, poor water and power supply, traffic congestion and environmental degradation.
Causes and Consequences of Rural- Urban Migration in Bangladesh: An Empirical Study in Chittagong City
(Centre for Research on Islamic Management and Business, 2013-12) Uddin, Md. Nezum; Firoj, Mahamuda
Migration is a natural process where normally surplus manpower released from the rural sector is needed for urban industrial growth. This study aims at throwing light on central characteristics of migrants, determining factors and consequences of rural-urban migration in the context of Chittagong city, Bangladesh based on a survey of 100 randomly selected migrants and their families. From the dataset, it is found that poverty, job search, landlessness, homelessness, various natural disaster are the main push factors for rural out migration, while easy access to informal sectors and slum area, higher income probability, better service facilities are the main pull factors behind migration. The ordinary least square technique is applied on three regression models which indicate the determinants of income of migrants before and after their migration, change of income after migration. Reducing disparities between rural and urban areas should receive in urgent attention to stabilize the rural out migration.
Circular economy model for developing countries: evidence from Bangladesh
(by Elsevier Ltd., 2018-05) Ahmed, Zobayer; Mahmud, Sakib; Acet, Hakan
From environmental and sustainable development perspective, circular economy model is rarely applied in developing countries compared to developed nations. The aim of this paper is to review the overall scenario of the circular economy (CE) model in Bangladesh toward sustainable development. The study relies on the descriptive analysis of both qualitative and quantitative data, collected mostly from secondary sources with some in-depth interviews of the experts in the relevant field. The overall environmental status of Bangladesh, prospects, prac- tices, and challenges of the circular economy model were thoroughly discussed in this paper. Though there are prospects to switching towards CE, the study reveals that the CE model's applicability is very limited in Bangladesh, being exercised mostly through recycling processes in some industries. Most importantly, we attempted to explore what is holding the CE practice in Bangladesh back, and iterated some policy, technical, and public participation barriers existing in Bangladesh. This paper will benefit the policymakers in developing countries in general and Bangladesh in particular to look more into the matter and hope to present ideas for future researchers to work on the idea of CE in the context of particular sectors and subsectors of Bangladesh.
Corporate governance and IFSB standard-4: evidence from Islamic banks in Bangladesh
(Emerald Publishing Limited, 2021-04) Rashid, Harun Ur; Khanam, Ruma; Ullah, Hafij
This paper aims to examine the compliance status of Islamic banks in Bangladesh with Shari’ah based accounting standards named Islamic Financial Services Board (IFSB) standard-4 and its association with corporate governanc
Corporate Social Responsibility Disclosure and Firm’s Productivity: Evidence from the Banking Industry in Bangladesh
(Sustainability, 2022-05-20) Zheng, Yubin; Rashid, Md. Harun Ur; Siddik, Abu Bakkar; Wei, Wei; Hossain, Syed Zabid
Since the empirical evidence on the relationship between corporate social responsibility disclosure (CSRD) and firm productivity is scarce in the context of the banking industry, the study examines whether CSRD leads banks in Bangladesh to higher productivity. Using annual reportdata of all 30 banks listed on the Dhaka Stock Exchange in Bangladesh from 2011 to 2018, the study applied a data envelopment analysis (DEA) to determine the productivity of the sample banks, and then ordinary least squares (OLS) analysis to examine the impact of CSR on the banks’ productivity. Furthermore, the study utilized two-stage least squares (2SLS) and a generalized method of moments (GMM) to check the robustness of the findings amid the detection of endogeneity issues. The study also used several alternative variables to check and verify the reliability of the study. The findings indicate that the greater a bank’s contribution to CSR, the higher its productivity. However, banks with more debt to assets are less productive. Additionally, the study observed that the impact of CSRD on bank productivity is higher in GRI banks compared to non-GRI banks, non-politically connected banks as opposed to politically connected banks, and conventional banks compared to Islamic banks. The study provides valuable insight into how CSR activities can promote bank productivity, thus motivating the banks to execute a well-thought-out action plan to ensure more CSR contribution.This study is the first ever bank-level evidence that provides insight into how the patterns of CSR activity of publicly traded banks impact their productivity
Criticisms of Coase Theorem: Can Ethical Strength of the Parties Ensure Efficient Resource Allocation?
(Centre for Research on Islamic Management and Business, 2016-06) Ahmed, Zobayer
Ronald Harry Coase (1910–2013), a British economist and author in his famous Coase Theorem states, „As long as private property rights are well defined under zero transaction cost, exchange will eliminate divergence and lead to efficient use of resources or highest valued use of resources.‟ The theorem has greater implications to internalize the externalities through market mechanism. However, the theorem has been criticized by environmental economists since the fundamental flaws of the theorem lie under the invalidity of its assumptions in the reality. Specially, in the presence of environmental externality, the assumptions of the theorem are not valid. This paper focuses on the role of parties in transaction where environmental externality exists, from the perspective of Islamic ethics. The paper argues, in the presence of negative externality where the assumptions of Coase Theorem are not applicable, the internalization of externality can still be possible without any government intervention. Such internalization is related to the ethical strengths of the parties involved in the environmental pollution. The paper further argues, the efficiency of resource utilization is positively related with the ethical strength of the parties in the market.
Criticisms of Coase Theorem: Can Ethical Strength of the Parties Ensure Efficient Resource Allocation?
([International Journal of Ethics in Social Sciences, 2016-06) Ahmed, Zobayer
Ronald Harry Coase (1910–2013), a British economist and author in his famous Coase Theorem states, As long as private property rights are well defined under zero transaction cost, exchange will eliminate divergence and lead to efficient use of resources or highest valued use of resources.‟ The theorem has greater implications to internalize the externalities through market mechanism. However, the theorem has been criticized by environmental economists since the fundamental flaws of the theorem lie under the invalidity of its assumptions in the reality. Specially, in the presence of environmental externality, the assumptions of the theorem are not valid. This paper focuses on the role of parties in transaction where environmental externality exists, from the perspective of Islamic ethics. The paper argues, in the presence of negative externality where the assumptions of Coase Theorem are not applicable, the internalization of externality can still be possible without any government intervention. Such internalization is related to the ethical strengths of the parties involved in the environmental pollution. The paper further argues, the efficiency of resource utilization is positively related with the ethical strength of the parties in the market.
Dividend Announcement of the Commercial Banks in DSE: Scenario and Effect on Stock Price
(Centre for Research on Islamic Management and Business, 2014-06) Uddin, Md. Nezum; Uddin, Mohammed Jashim
In this study we have tried to show the dividend scenario of the listed commercial bank of Dhaka Stock Exchange (DSE) from the fiscal year 2000 to 2013. The study also tried to investigate the effect of dividend announcement on stock prices based on the 28 DSE listed commercial banks. In this context declaring dividends during the fiscal year 2012-2013 have been considered as the observation period and event study methodology has been used. The result by using event study methodology indicates that there is no effect of dividend announcement on stock prices over the observation periods.
Does board independence moderate the effect of politician directors on CSR disclosure? Evidence from the publicly listed banks in Bangladesh
(© Emerald Publishing Limited, 2021-04-20) Rashid, Md. Harun Ur; Hossain, Syed Zabid
This study aims to investigate the moderating effect of independent directors on the relationship between politicians on the board and corporate social responsibility disclosure (CSRD).Design/methodology/approach – The ordinary least square has been used to analyze the CSRD data collected from the annual reports of all 30 listed banks of Bangladesh covering six years period rangingfrom 2013–2018. Further, the study has applied the generalized method of moments to prove the robustness of the model across the endogeneity issue. Findings – The study found a positive relationship between board independence and CSRD that indicates board independence enhances the CSRD to a great extent. On the contrary, the inclusion of politicians on the board has shown a negative impact on CSRD that implies the higher the presence of political members on the board of a bank, the lower the involvement of the bank in CSR activities. However, board independence positively and significantly moderates the politician directors on the CSRD. The findings imply that if the independent directors are empowered, they play the role of whistleblowers that, in turn, mitigates the negative role of politician directors to CSRD.Research limitations/implications – The study suggests the banks’ management, and regulatorybodies formulate sound policies so that the banks are forced to include more independent directors withenough power and at the same time, reduce the politician directors on the board.Originality/value – The study extends debate on the political CSR and CSRD through validating the roleof board independence
Economic Rationalism and Consumption : Islamic Perspective
(Centre for Research on Islamic Management and Business, 2014-12) Hossain, Basharat
This paper presents a comparative view of Islamic economic rationalism and consumption framework to its counterpart’s conventional capitalist and socialist economic system. In conventional economic system, only self-interest and rationality of the consumer is the main principle to maximize utility whereas moral, religious, national, historical, cultural and social values are absent here. Consequently, the consumers enjoy sovereignty with little or no intervention of regulatory authority to maximize the utility. On the contrary, Islamic economic system designs its rationality and consumption principle in moderation that is far away from extremism where freedom and regulation is moderately recognized. Therefore, Islamic rationality encourages the consumers to maximize his utility by insuring religious, national, historical, cultural and social values. Besides, conventional economics have no treatment to immoral activities of consumer while Islamic economics derived from the Holy Quran and Hadith offers rewards and punishments for moral and immoral activities in worldly and hereafter life.
Effect of military expenditure on economic growth: evidences from India Pakistan and China using cointegration and causality analysis
(Asian Journal of German and European Studies, Springer open, 2019-06-21) Raju, Mohammad Hasan; Ahmed, Zobayer
The study revisited the existing evidences of India Pakistan and China with updated data on the effect of military expenditure on economic growth. Econometric approaches analyzed the short and long run relationship between GDP growth and Military expenditure. Empirical studies have been done using cointegration analysis and causality test to justify the relationship and causality of the variables. Interestingly, study obtained positive log-run relation, no short run relationship and unidirectional long run causality in every cases, but for different degrees of relationship. Obtained results are robust and passed necessary diagnostic tests significantly
Environmental Kuznets Curve (EKC) for Bangladesh: Evidence from Fully Modified OLS Approach
(Journal Of Emerging Economies and Policy, 2021-03) Rahman, Mohammad Mahbubur; Enayet Karimb, Abu Ansar Mohammad; Ahmed, Zobayer; Acetd, Hakan
Exploring the Relationship between Customer Loyalty and Financial Performance of Banks: Customer Open Innovation Perspective
(Journal of Open Innovation: Technol. Mark. Complex., 2020-10-09) Rashid, Md. Harun Ur; Nurunnabi, Mohammad; Rahman, Mahfuzur; Masud, Md. Abdul Kaium
Abstract: In the age of technology, continuous innovation is the ultimate motto of the financial sectorto attract customers. Firms in the financial sector must be innovative in terms of service quality and operational performance to obtain customer loyalty and gain financial stability. A dearth of studies on customer loyalty and financial performance of Islamic Banks motivated the authors to examine the relationship between customer loyalty and financial performance. The study also explores whether the service qualities have any impact on customer loyalty. The study uses both primary and secondary data to conclude the research objectives. A survey of 356 questionnaires was carried out among the customers of the selected Islamic banks of Bangladesh to gather information regarding customer service quality and customer loyalty, while financial performance data were attained from the annual reports. Moreover, the study follows the SERVQUAL model’s five dimensions (tangibles, empathy, assurance, reliability, and responsiveness) to determine the service quality of Bangladeshi Islamic Banks. Rigorous statistical techniques, including exploratory factor analysis, reliability testing, and regression analysis were used to investigate the hypothesis. The study empirically documents a positively significant impact of service quality (tangibles, empathy, reliability, and responsiveness) on customer loyalty, while assurance shows an insignificant relationship. Furthermore, the study does not find any significant relationship between customer loyalty and the financial performance of Bangladeshi Islamic Banks. The findings of the study profoundly denote that the financial performance of Bangladeshi Islamic Banks mostly depends on many other financial and non-financial factors, rather than customer loyalty
Financial Development, International Trade and Economic Growth Nexus (1971-2016): Examining Bangladesh Perspective
(Bangladesh Journal of Integrated Thoughts, 2022-05-25) Islam, Md. Shaidul; Faruque, Omar; Ahmed3, Zobayer
Studies have examined economic growth mostly without inspecting the combined effect of international trade (IT) and financial development (FD). Considering Bangladesh's perspective, this study investigates the nexus of IT, FD, and economic growth. Time-series econometric data covering 1971-2016 are used. Econometric techniques that are used to meet the objectives are mainly the “Augmented Dickey-Fuller” for unit root test, “Johansen and Juselius” test for co-integration and popular VECM for checking long-run equilibrium relation and causality test. The exploratory findings of this study show that a long-run equilibrium relationship exists among the IT, FD and the growth of the economy. This study also finds unidirectional or one-way long-run causality from IT and FD to the economy's growth, and in the short-run, bidirectional causality is running from IT to Economic growth and Economic Growth to IT. Policies related to further FD and trade openness are suggested for accelerating the growth of Bangladesh economy.
Firms’ Characteristics and Tax Evasion
(2021) Rashid, Md. Harun Ur; Morshed, Anika
The study investigates whether the firms’ characteristics, including ownership structure, audit, and famil-iarity affect tax evasion. The study has used the ordinary least square (OLS) to analyze cross-sectional data of 85 countries between 2007 and 2015 collected from the world enterprise survey. The study finds that the domestic, foreign, and government ownership in the firm increases tax evasion, whereas proprietorship and female ownership decreases the tax evasion. Further, the results show that familiar firms with international recognition are less inclined to evade tax. Similarly, the negative relationship between audit and tax evasion implies that the government should make it compulsory to check the financial statements of the firms by the external auditors, which, in turn, reduces the firms’ tax evasion.Moreover, the firms that face more financial constraints evade more tax than the firms with access to the bank loan and solvent ones. The tax authorities should also consider reducing the corporate tax rate as the higher tax rates stimulate the firms to evade more tax.
Investigating Okun‟S Law In SAARC Countries: An Ardl Approach
(EUL Journal of Social Sciences, 2021-06) Hanif, Abu; Ahmed, Zobayer; Çevag, SavaĢ
The aim of this paper is to test the applicability of Okun‟s law in SAARC (South Asian Association for Regional Cooperation) countries. It also intends to find the long-run association between unemployment rate and growth rate and investigate the impact of growth rate on unemployment in the South Asian Region. The study uses annual time series data for eight SAARC countries, from 1991 to 2017. To meet the objectives of the research, the graphical illustration of trend with descriptive statistics are followed by econometric analysis. Based on the stationarity of the variables, an autoregressive distributive lag (ARDL) model has been estimated to test the long- run relationship between unemployment and growth. The results indicate that per capita GDP negatively influences the unemployment rate in the long run only in three member countries of SAARC, namely- Afghanistan, India and Sri Lanka and in the South Asian Region in aggregate. This paper also finds a negative relationship between the growth rate and unemployment rate in Bangladesh, but this association is not statistically significant. The study doesn‟t find any negative relationship between the two variables in Bhutan, Maldives, Nepal and Pakistan. The study discovers the validity of Okun‟s law, but the attained Okun coefficient is less than that of the actual Okun coefficient, documented by Arthur Okun. Another substantial evidence is that the significance of the connection between the growth rate and unemployment rate varies among the SAARC countries. The main limitation of this paper is the unavailability of data for Afghanistan compared to other SAARC countries. This paper is unique as it tests the validity of Okun‟s law in every member country of SAARC and as a region of South Asia. To date, no such study like this has been found in the body of literature which finds long-run relationship in all SAARC countries
Islamic Microfinance and Sustainable Development Goals in Bangladesh
(Centre for Research on Islamic Banking & Finance and Business, 2018) Rashid, Md. Harun Ur; Uddin, Mohammed Jashim; Zobair, Shah Asadullah Mohd.
The main objective of this study is to explore the Islamic Microfinance Instruments in achieving the Sustainable Development Goals (SDGs) in Bangladesh. The methodology of this study is based on secondary data including existing relevant literature, and annual reports of different financial institutions. The findings of this study show that Islamic microfinance institutions have a broader scope to attain SDGs through their various investment modes.The study categorizes the Islamic microfinance instruments into four broadly parts which are profit and loss sharing financing, non-profit & loss sharing financing, Islamic social enterprise based financing and charity based financing which have a positive effect to the real sector of the sustainable economy that will lead towards achieving SDGs. The Islamic Microfinance institutions are continuing their efforts in attaining SDGs through their various products. With growing the potentiality, Islamic microfinance has both direct and indirect impacts on ensuring economic development, environmental sustainability, and social inclusion by creating employment opportunity, spreading knowledge and skills, making self-dependent, protecting from adverse effects. The paper also tries to put recommendations to reduce the challenges of Islamic microfinance acting as impediments to achieving the SDGs.