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International Journal of Management Studies (IJMS) Vol. 24, No. 1 June 2017

TITLE  PAGE 
 
  Tan Suang Sin, Lim Chee Chee
 
1-22
 
  Azira Abdul Adzis
 
 23-39
 
  Bashar Yaser Almansour, Yaser Ahmad Arabyat
 
 41-71
 
  Lim Hock-Eam, Siew Goh Yeok
 
73-90
 
  Sarina Ismail, Sany Sanuri Mohd. Mokhtar
 
91-118
 
  Muhammad Shukri Bakar, Azahari Ramli, Najafi Auwulu Ibrahim, Ibrahim Garba Muhammad
 
  119-137  
 
  Masoud Yahoo, Zakariah A. Rashid, Mohammad Mahdi Kiaeeha, Fatemeh Chatri
 
139-167
 
  Noor Azmi Hashim, Zolkafli Husin, Ismail Lebai Othman, Ali Yusob Md Zain
 
169-185
 

 
A PRELIMINARY STUDY ON THE RELATIONSHIP BETWEEN PSYCHOGRAPHIC FACTORS AND THE PURCHASE OF LIFE INSURANCE
Tan Suang Sin, Lim Chee Chee
School of Economics, Finance and Banking
UUM College of Business
Universiti Utara Malaysia
 
Abstract | Full Text
This was a preliminary study conducted to examine the relationship between psychographic factors (i.e., personal value, risk attitude, and trust) and the purchase of life insurance among Alor Setar city folks. A non-probability convenience sampling technique was used to collect data from early February to mid-March 2015. A sample comprising 108 respondents were subjected to binary logistic regression analysis. The major finding of this study showed that risk attitude has a significant and negative relationship with the purchase of life insurance. Respondents in Alor Setar who are more likely to involve in risky behaviours or activities tend not to buy life insurance. Risk taking individuals do not behave like risk averse individuals who tend to seek protection by buying life insurance as a method to cover their personal risks. Meanwhile, personal value and trust were found to have no significant relationship with the purchase of life insurance among respondents in Alor Setar. It is recommended that a comprehensive study covering wider areas with larger sample sizes be included in future studies to obtain more reliable results that would enable the generalisation of findings.

Keywords: Life insurance, Psychographic factors, Personal value, Risk attitude, Trust
 
Received: 06/03/2017 Revise: 12/04/2017 Accepted: 17/4/2017 Publish: 27/7/2017

 
THE PRO-CYCLICALITY OF LOAN LOSS PROVISIONS: EVIDENCE FROM SELECTED EAST ASIAN COUNTRIES
Azira Abdul Adzis
Department of Banking and Risk Management
School of Economics, Finance and Banking
Universiti Utara Malaysia
 
Abstract | Full Text
This study investigated the evidence of pro-cyclical behaviour of loan loss provision in four East Asian countries, namely Malaysia, Thailand, Singapore, and Hong Kong for the period 1995-2009. Pro-cyclical is defined as building up more loan loss provision during the bad times and reducing them in good times. This study hypothesized that pro-cyclical behaviour of loan loss provision exists in East Asian countries, since they had experienced two types of financial crises – Asian financial crisis in 1997 and global economic crisis in 2008. Utilising a sample of 47 banks, the findings demonstrated that there is evidence of a pro-cyclical pattern in the countries studied, as shown by the negative relationship between loan loss provision and GDP. This study does have a policy implication, where bank regulators should take pro-active action in addressing the issue of pro-cyclicality of loan loss provision because in bad times, increasing loan loss provision would affect the bank’s profit, weaken the bank’s capital, and in turn, diminish its lending activities to creditworthy borrowers.

Keywords: Pro-cyclical, Loan loss provision, Malaysian bank
 
Received: 03/03/2017 Revise: 17/04/2017 Accepted: 17/4/2017 Publish: 27/7/2017

 
INVESTMENT DECISION MAKING AMONG GULF INVESTORS: BEHAVIOURAL FINANCE PERSPECTIVE
Bashar Yaser Almansour
Finance and Economics Department,
Taibah University, Medina, Saudi Arabia
 
Yaser Ahmad Arabyat
Finance and Economics Department,
Al-Balqa' Applied University, Al-Salt, Jordan
 
Abstract | Full Text
The rationality hypothesis has been a very popular topic among the academics. Being a widely accepted hypothesis as part of the traditional finance theories, an investor is deemed a rational agent and makes rational decisions by exhausting all available alternatives. However, recently, new behavioural finance theories have been gaining ground as many empirical findings, which have been left unanswered by the traditional theories, can be explained by these behavioural-approach based theories. This research examined the impact of psychological factors on risk-taking behaviour in investment decisions. In particular, this research considered the possible effects of psychological factors, namely herding, heuristics, prospect, market, self-attribution bias, and familiarity bias, in making investment decisions. The findings in this paper declared that risk-taking behaviour in investment is affected by herding factors, heuristics factors, prospect factors, market factors and self-attribution bias factors. The familiarity bias factors do not significantly affect risk-taking behaviour in financial investment.

Keywords: Behavioural finance, Herding, Heuristics, Prospect, Market, Self-attribution bias, Familiarity bias
 
Received: 26/04/2017 Revise: 16/05/2017 Accepted: 1/6/2017 Publish: 27/7/2017

 
ESTIMATING THE DETERMINANTS OF VEHICLE LOAN DEFAULT IN MALAYSIA: AN EXPLORATORY STUDY
Lim Hock-Eam, Siew Goh Yeok
School of Economics, Finance and Banking
Universiti Utara Malaysia

Abstract | Full Text
As revealed by Malaysia’s bankruptcy statistics, around a quarter of bankruptcy in Malaysia is due to default of vehicle loan. This has led to the tightening up of vehicle loan underwriting and increased vehicle loan rejection rates. The need for a better credit risk scoring model is also raised by the banks. This warrants a study to estimate the determinants of vehicle loan default in Malaysia. This paper estimates the determinants of vehicle loan default probability which could be used to build a loan default prediction or forecasting model for credit risk scoring purposes. Using a simple random sample of 138 car loan borrowers that was provided by an established bank in Malaysia, the descriptive statistical procedures and econometrics modelling were performed to unveil these vehicle loan default determinants. Results of descriptive statistics revealed that more than half of the borrowers were default. Results of logit models further revealed that loan related characteristics are the most important determinants of probability of default. Specifically, the significant determinants of loan default were: areas of residence, vehicle purchase price, length of service, existing relationship with bank, interest rate, and available guarantor. Borrowers who are in high risk of default are characteristically those who reside in rural areas, secure higher vehicle purchase price, have longer length of employment service, are borrowers new to the bank, acquire loans charged with high interest rates, and are without a guarantor.

Keywords: Loan default; Vehicle loan; Logit model; Forecasting model.
 
Received: 12/4/2017 Revise: 13/5/2017 Accepted: 15/5/2017 Publish: 27/07/2017

 
CORAK PEMBELIAN PRODUK BERASASKAN HERBA DI MALAYSIA
(Buying Patterns of Herbal-Based Products in Malaysia)
Sarina Ismail
School of Maritime Business & Management
Universiti Malaysia Terengganu

Sany Sanuri Mohd. Mokhtar
School of Business Management
UUM College of Business
Universiti Utara Malaysia

Abstrak | Full Text
Penggunaan herba semakin mendapat tempat dalam kehidupan masyarakat moden pada masa ini dan sering digunakan sebagai perubatan alternatif. Terdapat peningkatan pembelian produk berasaskan herba dalam pasaran sama ada keluaran tempatan mahupun antarabangsa. Akan tetapi, bagaimanakah caranya untuk usahawan industri herba menjadi lebih berdaya saing dalam memasarkan produk berasaskan tanpa mengetahui corak pembelian? Corak pembelian dianggap penting dan dapat membantu usahawan untuk mengetahui persoalan berkaitan dengan apa, di mana, bagaimana, dan berapa banyak pembelian untuk sesuatu produk? Lantaran itu, ianya dapat membantu usahawan dalam proses penentuan campuran pemasaran serta memastikan kelangsungan jangka hayat perniagaan, kepuasan hati para pelanggan dan juga mengenal pasti keberkesanan strategi pemasaran. Dalam menentukan pensampelan kajian, kajian ini menguna pakai kaedah pensampelan kuota untuk menentukan jumlah populasi, manakala kaedah mall intersep digunakan sebagai salah satu kaedah pengumpulan data, pemilihan kaedah ini dibuat adalah untuk mendapatkan kepelbagaian karakter responden. Dapatan kajian menunjukkan bahawa corak pembelian produk berasaskan herba terdiri daripada pembeli sering membeli produk pemakanan kesihatan berbanding produk yang lain serta membeli di kedai yang menjual produk berasaskan herba berbanding lokasi pembelian yang lain. Para pembeli juga didapati lebih mempercayai maklumat yang disampaikan oleh rakan-rakan berbanding saluran maklumat yang lain. Hasil daripada analisis ini juga menunjukkan bahawa pembeli lelaki lebih kerap membeli dan lebih lama menggunakan produk berasaskan herba berbanding pembeli wanita.
 
Kata Kunci: Corak pembelian; Produk berasaskan herba; Pensampelan kuota; Mall intersep; Malaysia.

Received: 21/3/2017 Revise: 14/5/2017 Accepted: 6/6/2017 Publish: 27/07/2017

Abstract
The herbal-based products are often considered as an alternative medicine and has gained interest since various local and foreign herbal-based product purchases have been increasing rapidly in the market. In order for entrepreneurs to be competitive in the herbal market, they should be well informed on the buying patterns of customers. Buying patterns can help them to be aware of what, where, how, and how much is the product being purchased. It can also help them in determining the most suitable marketing mix, maintaining business continuity, meeting customer satisfaction, and identifying the effectiveness of marketing strategies. In the present study, the quota sampling method was used to determine the sample population, and intercept mall method was employed in order to collect data from respondents. The results showed that buyers more often buy herbal suplements than compared to other products. They also prefer to buy products from herbal outlets as compared to other locations. It was also revealed that customers would believe the information communicated by their friends more than information received through other channels. Moreover, the results indicated that men, as compared to women, bought and use herbal-based products more frequently.

Keyword: Buying patterns; Herbal-based products; Quota sampling; Mall intercept; Malaysia.
 

 
ENTREPRENEURIAL SELF-EFFICACY DIMENSIONS AND HIGHER EDUCATION INSTITUTION PERFORMANCE
Muhammad Shukri Bakar, Azahari bin Ramli
School of Business Management
Universiti Utara Malaysia

Najafi Auwalu Ibrahim, Ibrahim Garba Muhammad
Department of Business Administration and Entrepreneurship
Bayero University, Kano, Nigeria

Abstract | Full Text
A detailed literature review provided consistent justification for the effect of entrepreneurial self-efficacy (ESE) on entrepreneurial intention. Recently, the literature yielded similar relationship on the link between ESE to firm performance. Although there are a significant number of studies on this effect that was mostly conducted in the private sector, they mainly focused on the composite ESE construct. The present study replicated and validated these findings with data from the public sector, specifically, higher education institutions (HEIs). Moreover, the study focused on the individual effect of all dimensions of ESE identified by Chen, Greene, and Crick (1998). Using PLS-SEM and non-probability sampling, the data were collected from 180 academic leaders from selected HEIs in Kano, Nigeria. The findings indicated that three dimensions of ESE (financial control ESE, innovation ESE, and risk taking ESE) were found to be significantly related to HEI performance, while two (management ESE and marketing ESE) were insignificantly related to HEI performance. The practical implication and suggestion for future study are also discussed.

Keywords: Entrepreneurial self-efficacy, HEIs, Performance
 
Received: 03/04/2017 Revise: 18/06/2017 Accepted: 05/07/2017 Publish: 27/7/2017

 
CONSTRUCTING A SOCIAL ACCOUNTING MATRIX TO ADDRESS INCOME DISTRIBUTION ISSUES IN MALAYSIA
Masoud Yahoo, Zakariah A. Rashid
Malaysia Institute of Economics Research (MIER)
Kuala Lumpur
 
Mohammad Mahdi Kiaeeha, Fatemeh Chatri
School of Economics 
Faculty of Economics and Management
Universiti Kebangsaan Malaysia
 
Abstract | Full Text
The Malaysian economy has undergone sound growth over the past three decades. During the 1990s, the government designed a vision to become a high-income developed nation by 2020. Strengthening aggregate demand within a developing economy such as Malaysia’s is critical for achieving this target. In quantifying the impact of such measures economists have employed the social accounting matrix as an analytical tool. The challenge associated with the construction of a social accounting matrix for Malaysia, especially when up-to-date databases are not readily available, is the main issue addressed by this paper. The constructed matrix can provide an updated country-wide data source for use in policy analysis and as a database for macroeconomic modelling purposes. The applied database investigates the key economic sectors contributing to Malaysia’s economic growth and income distribution between three household types. This paper presents the first attempt in this direction employing recently published input-output tables and complemented with updated data from different sources.

Keywords: Social Accounting Matrix, Government expenditure, Income distribution, Multiplier analysis, Malaysia.

Received: 03/04/2017 Revise: 18/06/2017 Accepted: 05/07/2017 Publish: 27/7/2017

 
THE ROLES OF PERCEIVED RISKS AND PRICE ON THE PURCHASE INTENTION OF CHINA-MADE HOME APPLIANCES AMONG CAREER WOMEN IN MALAYSIA
Noor Azmi Hashim, Zolkafli Husin, Ismail Lebai Othman, Ali Yusob Md Zain
School of Business Management 
UUM College of Business
Universiti Utara Malaysia
 
Abstract | Full Text
The purpose of this research paper is to report on the purchase intention of China-made home appliances among career women in Malaysia. The purchase intention is hypothesised to be influenced by the price and preference of today’s career women who are indifferent to the product’s country of origin and brand. Data were collected by random sampling from 430 career women in selected states in Malaysia in 2016 and were used to test the hypotheses. Survey questionnaires were used to collect the data by utilising a self-administrated method. The relationships between price, perceived risks, attitude toward brand, and purchase intention were tested in this study. The results showed that price is the main factor being considered by the career women in Malaysia when they decide to purchase China-made home appliances. This study implied that marketers need to capitalise on pricing strategy in order to market their home appliances among career women.

Keywords: China-made, Purchase intention, Perceived risk, Attitude towards brand, Malaysia.

Received: 03/04/2017 Revise: 18/06/2017 Accepted: 05/07/2017 Publish: 27/7/2017

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