Business Commons^™

A Systematic Literature Review On Overconfidence And Related Biases Influencing Investment Decision Making, Uttam Karki, Vaneet Bhatia, Dheeraj Sharma

Economic and Business Review

In the current market scenario, it has been observed that biases are among the most significant factors influencing investment decisions. Among these biases, overconfidence is a common phenomenon managers tend to exhibit while making decisions. To understand the role of overconfidence bias in investment decision making, this study thoroughly scrutinizes and consolidates the current research on overconfidence bias. To achieve the objective, this study performs a systematic review of literature utilizing the PRISMA approach and examines 92 journal articles published in the last 20 years. Results suggest that the other two biases—hindsight and confirmation—are related to overconfidence bias. In addition, …

Implementing The Single Supervisory Mechanism In The Euro Area: Effects On Deposit Structure Of Banks, Emilija Popovska, Marko Košak

Economic and Business Review

In this paper we investigate whether the banks which fall under direct supervision by the European Central Bank (ECB) are more likely to be considered more stable and trustworthy by the depositors due to the stricter supervisory activities performed since the implementation of the Single Supervisory Mechanism (SSM). Under the SSM, significant banks switched from national supervisors to ECB, whereas the remaining banks remained under national supervisory authorities (NSAs). Using the difference-in-difference (DID) method, we have found evidence of increased depositors’ trust in significant banks after the SSM implementation. Additionally, in anticipation of the SSM launch and the comprehensive assessment, …

Firm-Level, Macroeconomic, And Institutional Determinants Of Firm Growth: Evidence From Europe, Anže Burger, Andreja Jaklič, Klemen Knez, Patricia Kotnik, Matija Rojec

Economic and Business Review

To examine the main drivers of firm growth, we estimated a model integrating firm-level, industry-specific as well as country-level determinants, aiming at a comprehensive explanation of firm growth. We used a large dataset of European firms for the 2005–2017 period and combined Amadeus firm-level data with macroeconomic variables and multidimensional measures of institutional framework, based on a range of sources. Using different panel regression model specifications, we found the most consistent relationships for firm-level determinants. Among country-level determinants, infrastructure quality, inward FDI, natural resources, and inequality show a consistently positive and significant relation with firm growth.

The Relationship Between Culture, Sustainable Use Of Resources, And Financial Performance: An Institutional And Natural-Resource-Based Perspective, Deon H. Engelke, Noel J. Pearse, Fabio M. Correa, Frederick O. Skae

Economic and Business Review

Modelling a dataset of 5230 globally listed firms through two statistical approaches reflecting the primary principles of Natural-Resource-Based Theory and Institutional Theory, respectively, this study provides evidence that sustainability initiatives developed by firms are being rewarded in the form of improved Corporate Financial Performance (CFP). Culture has a significant influence on both firm sustainability performance, captured in ESG ratings, and CFP and also interacts with other variables, including industry sector and socio-economic development of a firm’s markets. This study is unique in hypothesising and statistically proving that sustainability is a mechanism that activates the potential of culture to produce CFP. …

Creativity In Information Systems Research: A Systematic Literature Review, Mojca Simonovič, Aleš Popovič, Matej Černe

Economic and Business Review

For more than six decades, creativity has been the cornerstone of diverse scientific disciplines, including psychology, sociology, and organizational behavior (OB) studies. Its fundamental role in guiding business prospects, driving development, and fueling economic growth has made it an essential research theme in many fields. Yet, despite its importance, scholars within the information systems (IS) discipline have highlighted the significant lack of attention paid to this concept in their research. The transformative role creativity plays in contemporary business environments, along with the ever-present need to innovate, compete, and grow, sparked our curiosity. Is creativity still an understudied area in the …

Transformational Leadership And Work Engagement: The Moderating Role Of Intrinsic Motivation, Barbara Grah, Vlado Dimovski, Marko Perić, Simon Colnar, Sandra Penger

Economic and Business Review

We examine the moderating role of intrinsic motivation in the relationship between transformational leadership and work engagement. In a sample of 168 tourism and hospitality employees in the quantitative section, Study 1, we found that the highest level of work engagement is identified when the level of intrinsic motivation is highest. Intrinsically motivated employees then exhibit engaged behaviors at work. In Study 2, we opted for a descriptive design to better understand the findings of Study 1, using interviews with three experts and a three-phase coding analysis. We found that increasing intrinsic motivation further promotes engaged work behavior. This article …

Revisiting The Nexus Between Job Insecurity And Employee Task Performance: Examining The Influence Of Self-Efficacy And Emotional Intelligence In A Mediation–Moderation Model, Adewale Adekiya, Umar Usman

Economic and Business Review

The objective of this study was to examine the relationship between perceived job insecurity and employee task performance. In addition, the moderating influence of emotional intelligence and mediating influence of self-efficacy was examined in this relationship. Through the multi-stage sampling technique, a total of 385 employees were proportionately selected from a cluster that represents three selected Nigerian deposit money banks. Furthermore, a close-ended and structured questionnaire was utilized in a descriptive cross-sectional research design to elicit responses from these employees. A hierarchical moderated regression analysis conducted revealed that perceived job insecurity exercises a significant and negative effect on task performance. …

Development And Validation Of Ethical Blindness Scale, Darija Aleksić, Guido Palazzo

Economic and Business Review

Recent models of ethical decision making have underlined the influence of unconscious processes of unethical behavior, and ethical blindness has been identified as a construct that deepens the understanding of unintentional unethical behavior. However, to date, no empirically tested measure of ethical blindness exists. Consequently, we have explored and developed a tool for measuring ethical blindness, which is presented in this paper. Based on qualitative data from interviews with individuals employed in different industries and a literature review, we developed a multidimensional measure of ethical blindness. The measure was tested and validated in several consecutive steps on three quantitative data …

Smes “Growing Smart”: The Complementarity Of Intangible And Digital Investment In Small Firms And Their Contribution To Firm Performance, Eva Erjavec, Tjaša Redek, Črt Kostevc

Economic and Business Review

Like large companies, small and medium-sized companies (SMEs) are turning to new digital technologies and knowledge-based capital to bolster their productivity and growth. However, data show that smaller companies lag significantly in implementing new Industry 4.0 technologies and in the intensity of their use. Lack of skills and human capital is often cited as one of the biggest barriers. This paper examines the benefits of digital technologies, intangible capital, and in particular the role of complementary investments in new technologies and intangible capital to maximize the impact on productivity growth. The analysis draws on extensive firm-level datasets combining business and …

Human Resource Management Systems And Firm Innovation: A Meta-Analytic Study, Yang Zhang, Matthew D. Griffith

Economic and Business Review

Building on the resource-based view, this paper examines the meta-analytic relationships between Human Resource Management (HRM) systems and different types of firm innovation (innovation in products or services, innovation in processes, and innovation in people and organizations) and the moderating role of sampled industries and sampled cultural clusters in these relationships. With 119 records from 57 unique papers published between 2000 and 2020, this study found that HRM systems positively contribute to innovation in products or services, innovation in processes, and innovation in people and organizations. Sampled industries and cultural clusters significantly moderate the relationships between HRM systems and innovation …

The Effect Of Primary School Entrepreneurship Education Programs On The Evolution Of Pupils’ Human Capital Assets, Janez Gorenc, Alenka Slavec Gomezel, Željka Kitić, Blaž Zupan

Economic and Business Review

The formation of entrepreneurship-related human capital in primary-school entrepreneurship education programs (EEPs) is of great interest to European policymakers. European education systems have widely implemented EEPs since the Oslo Agenda for entrepreneurship education in Europe was passed in 2006. However, primary-school EEPs remain an underresearched domain of entrepreneurship education. The present article investigates the development of entrepreneurship-related human capital in EEPs for 9–14-year-olds in 22 primary schools. It uses a quasi-experimental design with repeated measures. Based on data obtained from a sample of 180 participants, the analysis finds that the whole group partly improved only one of the components of …

The Impact Of Fdi And Financial Depth On Eu Regional Growth: Income And Spatial Heterogeneity, Marialena Petrakou, Randolph Luca Bruno, Nick Phelps

Economic and Business Review

Background and objective: The paper explores the impact of foreign direct investment and financial development on regional growth at the EU regional level for 2005–2017. Both FDI and financial development are important determinants of the regions’ growth, but not for all EU regions homogeneously. Some EU regions seem to benefit more than others, depending on certain characteristics, which implies that FDI attraction policies need to bear in mind not only country specificities, but also regional specificities, hence confirming the need for developing FDI attraction policies at the subnational level: financial development, capacity building, and Investment Promotion Agencies are key, …

Macroeconomic Drivers, Governance, And Foreign Direct Investment In Central And Eastern European Countries (Ceecs), Parfait Bihkongnyuy Beri, Gabriel Mhonyera

Economic and Business Review

Background and objective: The transition to market-oriented economies in CEECs entailed significant structural economic and institutional reforms. Over the past years, studies have investigated how these reforms affected foreign direct investment (FDI) inflows. However, the evidence remains debatable and varies across countries. This study provides new insights by considering the impact of macroeconomic factors, governance, and the moderating effect of governance on the macroeconomic drivers–FDI nexus.

Methods: A panel of 12 countries from 1991 to 2020 are analysed within the framework of conventional methods and Seemingly Unrelated Regression (SUR).

Results: Results robustly suggest that gross capital formation, macroeconomic stability, and …

How Do Brand Communication And Brand Personality Shape Consumer Loyalty?, Emilija Heleta Švrakić, Maja Arslanagić-Kalajdžić

Economic and Business Review

The concept of brand personality plays a crucial role in brand literature as consumers tend to anthropomorphize brands by attributing human characteristics to them. The creation of a brand personality that resonates with consumers leads to greater customer satisfaction and loyalty over the long term. This study investigates the mediating potential of brand personality dimensions, specifically Competence and Sophistication, in the relationship between brand communication (both controlled and uncontrolled) as an antecedent and brand loyalty as an outcome. Using a sample of 340 users of a cosmetic brand, we employed structural equation modeling to analyze the data. Our results indicate …

Relationship Between Customer Expectations And Financial Performance Of Food Industry Businesses In A Customer Satisfaction Model, Petr Suchanek, Maria Kralova

Economic and Business Review

Research on customer satisfaction in repeat purchases shows that the relationship between customer expectations and customer satisfaction can be inverse to what is commonly reported. This also has an impact on the financial performance of an enterprise, which is therefore directly influenced by customer expectations. The goal of this paper is to determine whether customer satisfaction affects customer expectations and whether these expectations have a direct impact on the financial performance of an enterprise. The variables representing factors of customer satisfaction, including customer expectations, are measured using a customer survey. Business financial performance (BFP) was measured using the ROA, ROE, …

Knowledge Hiding In Organizations: Meta-Analysis 10 Years Later, Miha Škerlavaj, Matej Černe, Saša Batistič

Economic and Business Review

A decade since the seminal paper on knowledge hiding in organizations (Connelly et al., 2012) emerged, this research area has witnessed rapid evolution, resulting in a fragmentation of the field and conceptual proliferation. Given the increasing interest in knowledge hiding, this study complements a set of recently published (systematic) literature reviews and proposes an organizing framework (nomological network) for antecedents and consequences of knowledge hiding, and tests it using meta-analytic procedures. Based on an effect analysis drawn from 131 studies and 147 samples, comprising 47,348 participants, the relationships between knowledge hiding and different antecedent and consequence categories are examined. The …

The Impact Of Wisdom And Courage On Presencing And Absencing At Work: The Mediating Role Of Mindfulness, Melita Balas Rant

Economic and Business Review

Background and Objective: Wisdom and courage are positive psychological capacities. Presencing and absencing at work are novel employee attitudes and behaviours. The objective of this paper is to explore the impact of wisdom and courage on presencing and absencing at work, while also considering possible mediation through mindfulness.

Methods: This paper hypothesises that wisdom has a positive impact on presencing and a negative impact on absencing, while courage has a negative impact on presencing and a positive impact on absencing. We expect mindfulness mediates the aforementioned relationships. An analysis is performed on a sample of 274 employees in …

Giving Sense To Change Leadership: Towards A Narrative-Based Process Model, Antonio Sadarić, Miha Škerlavaj

Economic and Business Review

Introduction: Recent studies on change agency and organizational change failure have significantly broadened the organizational behavior perspective on individual change experiences, however, the underlying mechanism for change leaders’ influential behavior remains a relatively underspecified area.

Objectives: Our central theoretical contribution focuses on the ways in which linking the findings from different research areas that deal with storytelling and persuasive communication can contribute to understanding the underlying mechanism of change leaders’ influential behavior.

Methods: We examine the various strands of research in management concerned with change leadership and persuasive communication, and propose a multidisciplinary perspective from developmental psychology, linguistics, political science, …

The Process Of The Intergenerational Succession Of Leadership In A Family Business, Bojan Dolar, Roberto Biloslavo

Economic and Business Review

Background and objective: In this paper, we explore first-generation leadership succession in family businesses which, despite extensive literature on the subject, remains insufficiently understood. Our goal is to acquire new knowledge and understanding regarding this phenomenon with a view to making it more effective.

Method: The basis of our research is a qualitative multiple case study that includes six medium-sized manufacturing family businesses. We conducted semi-structured interviews with incumbents, successors and family representatives, and analysed the data obtained using the content analysis method.

Results: The data analysis and interpretation led to a definition of the category “The way ahead: the …

A Literature Review Of Hrm Systems And Firm Innovation, Yang Zhang

Economic and Business Review

Background and objective: This paper integrated different theoretical perspectives and investigated how, when, and why human resource management (HRM) systems influence different types of firm innovation. Moreover, this paper presented the current dilemma and future research directions in the field of HRM systems and firm innovation.

Methods: A thorough literature review.

Results: In the HRM system perspective, there are three main types of firm innovation: innovation in products or services, innovation in processes, and innovation in people and organizations. Empirically, researchers have considered organizational capacity, capital, and climate both as moderators and mediators to explain the relationship between HRM systems …

Corruption: A Review Of Issues, Sandra Damijan

Economic and Business Review

This paper provides a historical overview of the concept of corruption, the existing models for studying it, and the main costs that corruption imposes on the economy and society at large. Corruption was first understood as a disturbance of the balance of state power, and later as the immorality of political patronage and favouritism of certain groups. It evolved from the public sphere to the intertwining of the public and private spheres, from a political issue to the intertwining of political and economic issues. The fight against corruption evolved from the maintenance of necessary checks and balances, from moral struggles …

A Qualitative Study Of Mindfulness, Sustainable Consumption And Consumer Well-Being And Their Interrelationships, Saba Resnik

Economic and Business Review

Consumers are becoming increasingly aware of the environmental degradation, negative economic consequences and social injustices caused by the unsustainable consumption of clothing products. Overall, therefore, sustainability requires more sustainable production of fashion apparel products as well as more responsible consumption behaviours by individual consumers. To gain a clearer picture of the concepts of mindfulness, sustainable consumption and consumer well-being and their interrelationships, in-depth interviews were conducted with individual consumers. The results of this study indicate a positive relationship between these three concepts as well as an overlap between the concepts of mindfulness and well-being.

Exploring The Strategic Elements Of Backers’ Persuasion In Reward-Based Crowdfunding, Sabina Grižančič, Mateja Drnovšek

Economic and Business Review

In this paper we investigate the strategic elements that project founders' use in reward-based crowdfunding campaigns to achieve a higher level of persuasion. Exploration of these elements not only provides insights into an entrepreneur's experience with crowdfunding but also provides material for comparing results reported by other (quantitative) studies. We conducted an empirical study with 13 Kickstarter project founders through in-depth, semi-structured interviews which were analysed through a reflexive thematic analysis approach. Drawing from our findings, we propose four strategic elements that founders use to persuade backers and achieve success drawing from individual-level experiences and observations.

Effect Of Work-Family Conflict On Job Satisfaction Of Small Enterprise Managers, Joseph Kwadwo Tuffour, Florence Mansa Bortey

Economic and Business Review

Balancing priorities and demands of work and family at the same time can be quite hectic and likely to generate conflicts. Workers must find strategies to manage the exigencies of modern living in order to maintain job satisfaction as well as family relationships. This study investigates the effect of work-family conflict’s two directions on job satisfaction, and the moderating role of resilience. The study used a cross-sectional survey method to collect data from 293 small-scale enterprise managers, utilizing a structured questionnaire. Correlation and analysis of variance techniques were used. The results reveal that the work-family conflict has a significant positive …

Ethically Minded Consumer Behavior Of Apparel: An Examination Of Antecedents And Consequences, Maja Hrlec Gorše, Mateja Kos Koklič, Anže Zalokar

Economic and Business Review

This research examines the ethically minded consumer behavior (EMCB) and its antecedents and consequences in the context of ethical clothes. Its objective is to test the relationships among the reasons for and against buying, subjective knowledge, EMCB and intention to purchase ethical clothes. The authors use survey data from 280 consumers to test the conceptual model. Support is provided for the majority of the hypothesized relationships: reasons for buying and subjective knowledge positively and reasons against buying negatively affect EMCB, and EMCB in turn positively influences the intention to purchase. Additionally, reasons against buying decrease the intention. The study also …

The Role Of Human Capital Investments In Business Excellence Of Croatian Companies, Ivana Tadić, Željana Aljinović Barać

Economic and Business Review

The paper analyses human capital investments and their relation to company performance in Croatia. Human capital represents an inevitable element in recognising and measuring an organisation’s values and supporting its business excellence. The results obtained show that training and extra bonuses or salaries are positively correlated with company excellence, as well as show a significant difference in the mean of salaries per employee between high and moderate intensive intellectual capital companies. The differences in company excellence, when human capital expenditures are capitalized in a company’s balance sheet rather than recognized as expenses in the company’s profit and loss account, is …

The Characteristics And Role Of Intangible Capital In Central-Eastern Europe, The Balkans And In The Mediterranean, Igor Lončarski, Mojca Marc

Economic and Business Review

No abstract provided.

Will Blockchain Really Impact Your Business Model? Empirical Evidence From Slovenian Smes, Horst Treiblmaier, Žan Špan

Economic and Business Review

In this paper, we use the widely popular business model canvas, which was previously adapted for the blockchain environment, to assess the experiences and perceptions of Slovenian small and medium-sized companies (SMEs) pertaining to blockchain technologies. The results reveal that SMEs expect applications built on blockchain technologies to have a highly positive effect on numerous aspects of their business model. This positive evaluation is even stronger among companies that already have experience with blockchain technologies.

Determinants Of Country-Level Employee Overqualification: A Configurational Approach, Aleksandar Nikolovski, Robert Kaše

Economic and Business Review

We build on the configurational approach to identify patterns of macro contextual factors leading to high country-level employee overqualification. We differentiate between subjective and objective employee overqualification and establish that each is caused by different configurations of macro factors. We also identify country-level overqualification archetypes and link specific countries with respective archetypes. We find that a country’s non-vocational education system is a necessary condition for high objective overqualification, while objective overqualification itself is not a necessary condition for perceived overqualification. We discuss theoretical implications and offer policy implications.

Consumer Confusion Caused By Nutrition Apps In Product Healthiness Evaluation, Mila Zečević, Petar Gidaković, Vesna Žabkar, Mateja Kos Koklič

Economic and Business Review

Rapid developments in technology and connectedness are influencing how consumers access and use nutrition information. However, this information is not always clear and consistent. The inconsistencies in the information provided to consumers can lead them to uncertainty about which data to use (i.e. consider as correct), especially when different sources of information appear similarly qualified and accurate. This paper aims to highlight the impact of inconsistent information on consumer attitudes. The results of an experiment conducted on a sample of 237 consumers indicate that the inconsistent information, when presented to consumers, influences their attitude in a way that it increases …