May 2015

Zagreb International Review of Economics and Business
Volume XVIII, Number 1 (May 2015)


A Panel Data Approach to the Measurement of Health Technical Efficiency of Sub-Saharan Africa
Elham Torkian

Abstract:  This study investigates technical efficiency of health production function in Sub-Saharan Africa. For this purpose, a stochastic production frontier model is estimated using fixed-effects panel data method over the period of 2000-2007. More specifically the impact of economic, social, and environmental factors in determining life expectancy at birth, as the dependent variable, is measured and evaluated. Overall, the results justify the important role of policymakers, who their proactive approaches should be given to activities that go beyond the health system to influence the main determinants of health i.e. socioeconomic and environmental factors in preventing infectious diseases, improving life expectancy and aid populations to access available resources.

Key words: Sub-Saharan Africa, Health production function, Technical efficiency, Panel data
JEL Classification: C12; C23; I12; I15

The Relevance of Trend Variables for the Prediction of Corporate Crises and Insolvencies
Mario Situm

Abstract: This study investigated the potential of a specific trend, defined as the relative change of accounting ratios for two consecutive years, to improve the classification accuracy and model performance of insolvency prediction models based on multivariate linear discriminant analysis. The results show that the respective trend can include information from both consecutive years, but this informational content could not be exploited to improve early detection of corporate crises and insolvencies.

Key words: insolvency prediction, discriminant analysis, accounting ratios, trend variables
JEL Classification: C53; G17; G33

Macedonian Small Investors’ Behavior Towards Stock Market
Julijana Angelovska

Abstract: Convenience sample survey was fielded to the Macedonian individual stock market investors to find out whether their investment behavior can be explained by some underlying factors grounded in the behavioral approach to the study of financial markets. Descriptive statistics technique has been used to analyze the investors’ attitude about the market’s efficiency and to test different theories of behavioral finance.  The results have indicated that investors are not completely rational individuals as supposed by theories of traditional finance. Also in the theoretical framework of behavioral finance Macedonian investors use heuristics, or rules of thumb, when judging information and forming beliefs, but Macedonian investors do not behave as suggested within prospect theory and regret aversion.

Key words: Investor Behavior, Individual Investors, Behavioral finance, Market Efficiency, Survey, Macedonian Stock Exchange
JEL Classification: C12; G10; G11; 016

Accounting Information in a Business Decision-Making Process – Evidence from Croatia
Ana Ježovita

Abstract: The objective of the conducted research includes examining importance of financial statements and financial statements analysis in business decision-making process. Conducted empirical research is focused on analysis of determining and evaluating the frequency of using accounting data and annual financial statements within the business decision-making process. According to obtained results, it can be concluded that more than 60% of examines frequently use accounting information and information available from annual financial statements within business decision-making process, and that they are familiar with methods of using technics of financial statements analysis for purposes of evaluating financial position and business efficiency.

Key words: financial statements analysis, financial ratios, decision-making process, accounting information
JEL classification: M41

Modeling Real Private Consumption Expenditure in Bulgaria after the Currency Board Implementation (1997-2005)
Aleksandar Vasilev

Abstract: In this paper, an econometric model of consumption in Bulgaria for the period 1997-2005 is constructed. The Error-Correction Model (ECM) approach is employed and long-run relationship between household consumption and income was found. The primary purpose of this empirical paper is to get a better understanding of the factors driving household consumption in Bulgaria and to estimate a consumption function to be used for medium-term forecasting. It is shown that all households behave in a Keynesian way, basing their consumption decisions on current income.

Key words: Keynesian consumption function, Permanent Income Hypothesis, Error Correction Model
JEL Classification: E21; E27