PAN-AFRICAN JOURNAL OF BUSINESS MANAGEMENT

Financial Development: The Role of GDP per Capita Dynamics in Low- & Middle-Income Economies

Saganga Mussa Kapaya — 2023-12-24

This study delves into the complex role of economic growth on financial development within low- and middle-income economies (LMIE). It analyzes a dataset spanning 85 countries from 1980 to 2020, collapsed into 9 periods, yielding 765 observations. Employing General Method of Moments (GMM), including two-step system GMM and forward-orthogonal deviations IV/GMM methods, the research uncovers intriguing dynamics. Positive shifts in GDP per capita are found to correspond with heightened financial development, whereas negative changes exhibit an adverse relationship. Government consumption yields mixed results, and inflation negatively impacts financial development, while trade openness and favorable terms of trade exhibit positive associations. These findings underscore the significance of economic development, price stability, trade openness, and financial sector stability in nurturing financial development in LMIE. Therefore, policymakers are encouraged to prioritize strategies aimed at fostering economic growth, income augmentation, and economic resilience, particularly in times of economic turmoil. This research offers a unique contribution by dissecting economic growth into positive and negative changes, providing insights into their distinct impacts on financial development using GMM estimation. It empowers policymakers to leverage economic growth shifts and trade reforms for inclusive financial development.

Examining the Influence of Mobile Payment Customer Experiences on Attitudinal and Behavioural Loyalty: Evidence from Tanzania

Pamela Liana — 2023-12-24

This study examined the influence dimensions of customer experience (CX) on attitudinal customer loyalty (ACL) and behavioural customer loyalty (BCL) in mobile payment (m-payment) service in Dar es Salaam, Tanzania. The unit of analysis employed was mobile payment customers, the sampling techniques used was convenient sampling and purposive sampling techniques to select service providers. Data analysis was conducted using Partial Least Square regression with sample size of 379 respondents. The results suggested that out of four dimensions of CX, moment of truth, peace of mind and outcome of focus have a significant positive relationship with both ACL and BCL. The product experience dimension revealed that in mobile payment context customer regards PEX as less important. The study recommends to managers to work on improving PEX through improving marketing strategies. Mobile phone operators/companies advocate customer experience in enhancing customer repurchasing and recommendations. The study contributes towards understanding of the role of customer experience in customer behavioural and attitudinal loyalty in mobile m-payment context. Also, the policymakers should support the provision of m-payment services, cross-product comparison and enhance freedom of choice.

Efficiency of Mutual Funds and Portfolio Performance Measurement: A Case of Selected Mutual Funds in Tanzania

Gwahula Raphael — 2023-12-24

This study examines the current efficiency trends in the Tanzanian mutual fund industry over a five-year span (2018-2022), focusing on six specific funds: Umoja Fund, WekezaMaisha, Watoto Fund, Jikimu Fund, Liquid Fund, and Bond Fund. Employing a non-parametric approach, specifically Data Envelopment Analysis (DEA), the research collects secondary data from diverse sources, including newspapers, journals, books, periodicals, and the websites of UTT and the Bank of Tanzania (BOT). Monthly Net Asset Values (NAVs) of the selected mutual funds are scrutinized from each scheme's inception. Motivated by the limited understanding of mutual fund efficiency in Tanzania despite reported successes in increased asset values, profitability, and investor numbers, the study reveals distinctive performances under Constant Returns to Scale (CRS) and Variable Returns to Scale (VRS) assumptions. Under VRS, all mutual funds consistently achieve nearly 100% efficiency, signifying optimal operational scales. However, under CRS, efficiency scores fluctuate over time, underscoring the importance of mutual funds' adaptability for enhanced efficiency. Furthermore, the research suggests that mutual fund size significantly influences efficiency and potential scale economies. Smaller mutual funds demonstrate superior resource utilization efficiency, attributed to their focused investment approach. The analysis of inputs and output slacks provides insights into efficiency and resource utilization, identifying areas of optimal resource management and highlighting opportunities for improvement. The findings offer valuable insights into mutual fund efficiency under different scale assumptions, emphasizing the importance of scale flexibility and efficient resource management for superior performance. Implications suggest avenues for further research to explore external factors, efficiency fluctuations, portfolio management practices, and longitudinal trends within the mutual fund industry.

Relationship Between Board Characteristics and Level of Corporate Disclosure Among Listed Companies in Tanzania

Michael Josephat Mwacha — 2023-12-24

This paper examined the relationship between board characteristics and Level of corporate Disclosure (LCD) among Tanzanian listed companies. Relationships between board size, board independence; directors’ remuneration and LCD were examined. The 105 firm-year observations for 21 listed companies in Tanzania from 2016 to 2020 were used. The study used the agency theory. An explanatory research design was employed. Balanced panel data for analysis were gathered using a survey method. Data were analyzed using descriptive and inferential statistics. Regression analysis was used in testing hypotheses. Findings showed that board size, board independence, directors’ remuneration were positively related to LCD. It was recommended that listed companies should appoint a higher proportion of independent directors to their boards. Independent directors can provide impartial oversight and are more likely to prioritize transparency and disclosure. Companies are adviced to optimize board size aim for a board size that is appropriate for their specific needs and industry. Moreover, listed companies should adopt transparent and fair director remuneration practices. This includes disclosing the structure of director compensation, including; salaries, bonuses, stock options, and other benefits. Policymakers and regulators should consider implementing or strengthening regulations related to board composition, independence, and disclosure practices.

Relationship Between Ownership Structures and Level of Corporate Disclosure Among Listed Companies in Tanzania

Michael Josephat Mwacha — 2023-12-23

This paper examined the relationship between ownership structures and the level of corporate disclosure (LCD) among Tanzanian listed companies. Relationships between director, government, institutional and foreign ownership and LCD were examined. The 105 firm-year observations for 21 listed companies were examined from 2016 to 2020. The agency theory was used. An explanatory research design was employed. Data were gathered through balanced panel data using a survey method. Descriptive and inferential analysis using Ordinary Least Square was used. Descriptive and inferential analysis using Ordinary Least Square was used. The study found that director, government, and foreign ownership positively affect the LCD, while institutional ownership negatively affects it. This implied that in Tanzania, ownership structures were very important in determining LCD.The study concluded that Tanzania's LCD is moderate, and companies should disclose director ownership, establish independent oversight mechanisms, collaborate with foreign investors, and engage with institutional investors to align corporate governance practices with international standards.

Malmquist Productivity Change of Mutual Funds in Tanzania

Gwahula Raphael — 2023-12-24

This study utilized Data Envelopment Analysis to assess the efficiency of six mutual funds in Tanzania spanning from 2018 to 2022. The analysis explores efficiency changes, technical advancements, scale efficiency, and total factor productivity. The results revealed significant trends of Mutual funds, on average, demonstrate a 3 percent increase in total factor productivity, signifying enhanced output relative to inputs attributed to improved management practices, technology integration, and operational enhancements. Conversely, technical efficiency change experiences by 2.7 percent decline, indicating that certain funds struggle to optimize inputs, potentially due to shifts in management strategies, resource allocation, or market variations. Further differentiation between large and small mutual funds reveals that larger entities exhibit more favorable productivity changes. This disparity is ascribed to economies of scale, improved investment prospects, and reduced transaction costs for larger funds. The study underscores substantial implications for mutual fund managers and the industry. Positive improvements in efficiency change, scale efficiency change, and total factor productivity indicated an overall positive trend in the mutual fund industry. Emphasizing economies of scale can enhance efficiency and overall outcomes, urging regulatory bodies to provide guidance on achieving economies of scale and fostering better practices. This research offers valuable insights into the mutual fund landscape, emphasizing the critical importance of adapting to evolving market dynamics and incorporating technology to maximize efficiency and success.

Determinants of Broilers Production in Per- Urban Areas in Dar es Salaam, Tanzania

Timothy Lyanga — 2023-12-24

Role of Servant Leadership Conglomerate Conflict Behaviour on Team Performance, Conflict Resolution Efficacy, and Turnover Intentionin Tanzania’s Higher Learning Institutions

Winifrida Saimon Malingumu — 2023-12-24

This paper explores the intricate relationship between servant leadership, conflict management behaviour, and organizational outcomes in the context of Tanzania's higher learning institutions. Through a longitudinal study involving 800 respondents from four public universities, the research investigates the interplay between servant leadership and conflict management styles, specifically focusing on integrating and compromising behaviors. The study employed a comprehensive methodology, utilizing questionnaires distributed over two waves with a one-year time lag. The findings revealed a positive correlation between servant leadership and integrating conflict management styles, specifically avoiding and accommodating. However, the anticipated correlation between integrating and compromising conflict behaviours in servant leadership is not confirmed. The study further examined the prevalence of cooperative conflict management patterns among Tanzanian university leaders, highlighting a combination of problem-solving and compromising strategies. A significant aspect of the research involved cluster analysis, which revealed distinct conflict behaviour patterns in Tanzanian universities. The result showed a preference for compromising and low-integrating (co-operative) patterns, as well as high-integrating and low-compromising (competitive) patterns. Notably, these patterns were not mutually exclusive, indicating a nuanced approach to conflict management. In the second part of the study, the paper delved into the impact of servant leadership's cooperative behaviour on team performance, conflict resolution efficacy, and turnover intention. The results affirmed the positive relationship between integrating and compromising conflict management styles and team performance while forcing behaviour showed a negative correlation. Moreover, the study identified a negative relationship between accommodating and forcing conflict management styles and turnover intention. The paper concluded that servant leaders in Tanzanian universities adeptly combined different conflict management styles, mitigating the adverse effects of conflicts on team performance and turnover intention. Even though avoiding and accommodating conflict behaviours were used together, problem-solving and compromising strategies were used a lot. This showed that servant leadership was used in a more complex way in Tanzanian higher education. The study contributed valuable insights into the dynamics of servant leadership, conflict management, and organizational outcomes, emphasizing the need for a contextual understanding of leadership behaviours and their cultural implications.

Intrinsic Motivation on Entrepreneurs' Intention to Adopt Crowdfunding: The Case of Kiva Lending Crowdfunding

Felista Ndumbaro — 2023-12-24

The study investigated the entrepreneur's intrinsic motivation and its relationship to the adoption of crowdfunding using a Kiva lending crowdfunding platform as case study. A total 241 entrepreneurs in Tanzania were surveyed using Partial Least Squares-based Structural Equation Modeling (PLS-SEM 3) to examine whether perceived behavioural control, personal attitude, and self-efficacy were predictors of entrepreneurs’ intention to adopt crowdfunding. The results indicated that an entrepreneur's self-efficacy, attitude, and perceived behaviour control significantly determine their intention to adopt crowdfunding. The study revealed that entrepreneurs who engaged in crowdfunding possessed a high degree of self-assurance in their abilities, indicating that they were confident in their capacity to perform the necessary tasks to complete the fundraising process. Moreover, the research highlights the importance of understanding the attitudes of entrepreneurs towards crowdfunding. Entrepreneurs with positive attitudes towards crowdfunding were more likely to engage in it to raise funds for their venture. The findings suggested that crowdfunding platforms should pay attention to the attitudes of entrepreneurs towards crowdfunding to understand their motivations and expectations better. This will enable crowdfunding platforms to tailor their services to meet the needs and expectations of entrepreneurs, ultimately resulting in a more successful crowdfunding experience for all parties involved.

Adoption of International Financial Reporting Standards and Financial Performance of Listed Manufacturing Firms in Nigeria

Odunsi, Oluwasegun Temitayo — 2023-12-23

This study reviewed the literature on the effect of the International Financial Reporting Standards (IFRS) adoption on financial performance of listed manufacturing firms in Nigeria. Forty-five journal articles on the subject published between 2012 and 2021 were analyzed. The study employed a narrative literature review. The review focused on determining whether there wre any significant differences between the financial performance measurements of listed manufacturing firms operating in Nigeria that were prepared using IFRS-compliant financial statements and local Generally Accepted Accounting Principles (GAAP). Second, to determine whether financial performance indicators developed using IFRS-compliant financial statements exhibit superior performance than those developed using local GAAP. The Studies reviewed employed secondary data, which were sourced from the annual reports of companies listed on the Nigerian Exchange Group, and the data were analyzed using panel regression analysis. According to the analysis of the literature, IFRS financial ratios are more accurate performance indicators than local GAAP financial ratios. Further investigation indicated that there were no notable discrepancies between the financial performance indicators (financial ratios) reported by listed manufacturing firms operating in Nigeria under local GAAP and IFRS-compliant financial statements. The study concluded that a company's financial performance (return on capital employed) improves in direct proportion to how closely it complies with IFRS disclosure guidelines. The study recommended that to sustain the positive effects of compulsory and voluntary financial performance disclosure, manufacturing firms should be concerned with the disclosure of important information at every point in time.