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Competition, Market Structure and Market Power in
the Insurance Industry in Lesotho
- - H M Bello, M Sepiriti and E M Letete
The study analyzes the degree of competition, market structure and market power in the
insurance industry in Lesotho. Data used for the study was collected from the existing insurance firms in
Lesotho between 2000 and 2005. Trends of fluctuations were studied for this period. The entropy index
was computed and used along with the actual number of firms and agents that existed in the industry,
to determine the concentration levels and the degree of competition. The results reveal that the market
is found to be oligopolistic in which there is existence of market power with some firms in the industry.
© 2009 IUP. All Rights Reserved.
Linkages Between the Malaysian Stock Market
and Some Selected Markets
- - Shaista Wasiuzzaman and Lim Ai Li
Many researchers claim that the stock markets are getting more and more integrated. In other
words, it is believed that there are stronger financial market linkages or co-movements among the stock
markets around the globe. This paper attempts to determine whether there are financial market linkages or
co-movements. Malaysia, Singapore, Japan and the US stock markets were screened in an attempt
to obtain information about the linkages in stock markets. Three methods were used to examine the
linkages or co-movements, namely, correlation analysis, cointegration analysis, and Granger causality test.
The results of the correlation analysis suggest that financial market linkages are weak among the
four countries undertaken in this study. Cointegration tests reveal that there is a long-run relationship
as there is at most a single co-integrating vector. Finally, Granger causality test shows that most of
the stock markets are influencing the other stock markets. Overall, the four stock markets seem to
have financial market linkages or co-movements.
© 2009 IUP. All Rights Reserved.
Modeling Time-Varying Downside Risk
- - Don U A Galagedera and Asmah M Jaapar
This paper estimates time-varying systematic downside risk using a parametric specification
(BEKK model) and a nonparametric procedure (rolling window technique). A sample of Malaysian
industry portfolio daily returns reveals that the covariance between portfolio excess return and excess
downside market return is persistent. There is a significant difference between the average downside risk
estimated in the BEKK model and in the rolling window technique. When the downside risk estimated in the
BEKK model is smoothed using moving averages, a positive association between the smoothed series and
the downside risk estimated in the rolling window technique is observed. This association gets stronger
as the smoothing interval gets closer to the length of the rolling window.
© 2009 IUP. All Rights Reserved.
Growth of Bank Deposits and Its Determinants:
A Pragmatic Study on Commercial Banks
- - Jaynal Ud-din Ahmed
Commercial banks are highly sensitive organizations open to public scrutiny. As such, they
must continuously ensure their profitability, which is essential for their growth and viability as also
for infusing public confidence. Thus, banks have assumed greater responsibilities in mobilizing
domestic resources for financing the priorities of the economy. Resource mobilization is an integral part
of banking activity. Bank deposits have certain peculiar features which combine the cannons of
liquidity, profitability and security. Further, the main objective of bank nationalization is tapping of
potential savings and marshalling them for strategic uses for productive purposes. To an investor, deposits
are the most secure and liquid financial assets available, which can accelerate banks lending to
various sectors. Deposit mobilization is the most important function of commercial banks since their
successful functioning depends on the extent of funds mobilized. The government has directed banks from time
to time to make all possible efforts to mobilize new deposits, which can only expedite the pace of
lending activities. The present paper is an attempt to evaluate the growth of deposit mobilization of banks
and its determinants in the Barak Valley region of Assam in the Indian context. For this purpose, a
study, based on statistical and financial tools, covering the period 1997 to 2007, has been conducted on
16 commercial banks operating in the region.
© 2009 IUP. All Rights Reserved.
A Study on the Characteristics of Investors
Using Motive-Based Segmentation
- - R Kasilingam and G Jayabal
Saving motive is a desire to reserve a certain portion of one's income for future needs. Noted
economist Keynes has given eight factors which he believed motivated individuals to abstain from spending
out of their incomes. The saving rate of households is affected not only by their ability to save, but
also by their willingness to save. India was able to save 32% of its Gross Domestic Product (GDP)
irrespective of its low per capita income and high inflation rate, mainly because of the inclination of people to
save. This study attempts to find out characteristics of persons having different levels of saving motives.
This will be useful to the marketers of investment products to design their marketing programs according
to the segment on which they want to concentrate.
© 2009 IUP. All Rights Reserved. | 
