Browsing by Author "Nellis, Joe"

Now showing 1 - 9 of 9
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    Developing the mortgage sector in Nigeria through the provision of long-term finance : an efficiency perspective
    (Cranfield University, 2014-03) Johnson, Paul Femi; Figueira, Catarina; Nellis, Joe; Manos, Ronny
    This research investigates the role of efficiency in attracting long-term finance to the mortgage sector. Within the framework of the traditional economic theory, the new institutional theory and the theory of mortgage collateral, the study investigates the efficiency of primary mortgage banks and the perceived efficiency of the larger system within which they operate using quantitative and qualitative techniques. Quantitative data were extracted from the financials of 27 mortgage banks in Nigeria, which constitute about 90% of the size of the entire industry in Nigeria, as measured by banks’ total assets. These were analyzed using data envelopment analysis (DEA) and stochastic cost frontier (SCF) analysis to determine the efficiency of mortgage banks in Nigeria. In-depth interviews and focus group discussions were conducted among 40 CEOs of mortgage banks in Nigeria to investigate the perceived efficiency of both the banks and the entire mortgage sector. This sample constitutes about 54.2% of the CEOs in the industry and represents all geopolitical zones and ethnic groups where mortgage banks exist in the country. A review of housing finance policies, systems and sources of funds in thriving emerging economies was also conducted with the aim of drawing lessons from them that are applicable to improving the efficiency of the Nigerian mortgage sector. The findings from the review formed the basis of a mixed method questionnaire survey to investigate the existing and potential sources of funds for housing finance, to assess the acceptability and suitability of lessons drawn from other countries in Nigeria and to make policy recommendations for improving the efficiency of the Nigerian mortgage sector. The findings reveal that on average, mortgage banks in Nigeria are 33% - 49% efficient compared to best practice firms within the sector. Ownership structure and bank size influence the efficiency of these banks. Banks owned by private organizations and commercial banks are more efficient than those owned by the government or religious organizations. Banks with average total assets in excess of ₦5 Billion are more technically efficient than those with total asset less than ₦5 Billion. Practitioners perceive the mortgage banks and the larger system within which they operate as only about 10% efficient. This perceived efficiency is much lower than the technical efficiency measured in the quantitative assessment. Through the lens of institutional theory, this low rating is attributed to the negative perception of the institutional structures of the mortgage sector by mortgage finance practitioners. The findings also reveal that two categories – external and internal factors – impair the efficiency of the sector. The regulative constraints account for 55% of challenges to efficiency, normative constraints account for 24%, while cultural cognitive constraints account for 21%. The study identified accumulated deposits in pension funds, unclaimed dividends, funds in dormant accounts of commercial banks and other financial institutions, and funds from insurance companies, as possible sources of long-term funds for housing finance, while a concerted effort is being made to set up a secondary mortgage facility. The findings also reveal that effective government policies, regulation and amendment of existing laws would help improve the efficiency of the mortgage banking sector and attract investors to this sector.
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    An evolutionary theory of systemic risk and its mitigation for the global financial system
    (Cranfield University, 2014-01) Ilin, Thomas; Nellis, Joe; Varga, Liz
    This thesis is the outcome of theory development research into an identified gap in knowledge about systemic risk of the global financial system. It takes a systems-theoretic approach, incorporating a simulation-constructivist orientation towards the meaning of theory and theory development, within a realist constructivism epistemology for knowledge generation about complex social phenomena. The specific purpose of which is to describe systemic risk of failure, and explain how it occurs in the global financial system, in order to diagnose and understand circumstances in which it arises, and offer insights into how that risk may be mitigated. An outline theory is developed, introducing a new operational definition of systemic risk of failure in which notions from evolutionary economics, finance and complexity science are combined with a general interpretation of entropy, to explain how catastrophic phenomena arise in that system. When a conceptual model incorporating the Icelandic financial system failure over the years 2003 – 2008 is constructed from this theory, and the results of simulation experiments using a verified computational representation of the model are validated with empirical data from that event, and corroborated by theoretical triangulation, a null-hypothesis about the theory is refuted. Furthermore, results show that interplay between a lack of diversity in system participation strategies and shared exposure to potential losses may be a key operational mechanism of catastrophic tensions arising in the supply and demand of financial services. These findings suggest new policy guidance for pre-emptive intervention calls for improved operational transparency from system participants, and prompt access to data about their operational behaviour, in order to prevent positive feedback inducing a failure of the system to operate within required parameters. The theory is then revised to reflect new insights exposed by simulation, and finally submitted as a new theory capable of unifying existing knowledge in this problem domain.
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    Exploring the potential of impact investing to catalyse transitioning to a circular economy.
    (Cranfield University, 2023-03) Bilewu, Omotayo; Nellis, Joe; Angus, Andrew
    There is an overwhelming need to address global social and environmental challenges, alongside an increasing recognition that ‘good business’ is intertwined with ‘doing good’. The emergence of impact investing as an investment vehicle to ‘intentionally’ tackle societal challenges, such as those captured within the United Nations Sustainable Development Goals, alongside generating financial returns is proving attractive to investors and asset managers. This doctoral thesis seeks to provide insights in response to calls for rigorous academic studies towards building institutional legitimacy that should increase market confidence and capital allocation. It starts by investigating the connections between impact investing and the circular economy - two concepts that have generated increased interest in parallel over the last decade. The review reveals that the attributes of impact investing suggest it could play a pivotal role in accelerating the transition to a circular economy. Using a social exchange theory lens, the evolving exchange modalities between investors, intermediaries, and investee companies in the impact investing ecosystem is examined. The results show that a nexus of activities influenced by formal and informal norms govern behaviours and expectations. These norms are crucial in the relational exchange between impact investors, intermediaries and investee companies. A conceptual framework emerges from the study to guide impact investing practice. Furthermore, a single embedded case study is conducted to explore how the exchange partners engage with behaviour change interventions that substitute trust with a mutual opportunity to incorporate sustainable development initiatives in the delivery of an affordable housing development. The findings indicate that mutual goals increase collaboration and cooperation, but are curtailed by the outcome of cost benefit analysis which impinges on trust. Nevertheless, there is scope for impact investors to encourage the uptake of circular economy principles through education and awareness with learning reinforced in project specific facilitated workshop settings.
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    Impact of political and legal environments on international trade
    (Springer, 2024-11-07) Abugre, James Atambilla; Nellis, Joe; Ofosu-Dorte, David; Ocran, Matthew Kofi; Abor, Joshua Yindenaba
    International trade has become increasingly important in the functioning of the global economy as a result of financial globalization and differences in resource endowments, prompting extensive economic research and increased demand for regional and global integration among nations and continents. International trade is one of the most salient changes in the world economy since 1980. However, many nations and other regional economic blocs have over the years instituted trade restrictions, tariffs, trade policies such as subsidies, and tax waivers among others to harness the potentials of economic comparative advantages in and within their jurisdictions. Political ideologies, instability, and insurgencies and risks are important factors that affect international trade across the globe. Legal regimes are equally important factors that determine the flow of free trade among nations. Civil and common law countries which have different focus of trade regulations and dividend policies are critical matters that affect trade decisions among MNCs and countries. This chapter examines the political and legal environments of international trade. In this chapter, we provide an overview of the emerging political and legal environments in Africa. We then discuss how the political as well as the legal environments and policy trends impact international trade of African countries.
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    Impact of regualtion on the formation of entry strategy of multinational banks - a case of foreign investment into the Chineses banking industry
    (Cranfield University, 2007-07) Xu, Yue; Nellis, Joe
    The purpose of this thesis is to both explore and explain the formation of entry strategies of the multinational banks (MNBs) investing in the People's Republic of China. The research is driven by an interest in understanding the strategic behaviour of the MNBs as they are presented with huge investment opportunities but potentially higher risks caused by the market and regulatory structures. The study explains the differences in entry strategies of the MNBs and explores the causes of convergence in their entry behaviours. The study is grounded in the eclectic theoretical paradigm based on which a conceptual framework is developed to incorporate three enabling factors for the competitive advantages of the MNB in the local market. The three enabling factors are also termed the OLI framework with regard to ownership-specific advantages (0), location-specific advantages (L) and internalisation-specific advantages (1). Correspondingly, three areas of literature are focused on in this research, namely, the resource-based view, the institutional theory and internalisation theory. The research design consists of in-depth case studies of ten multinational banks. The cases are analysed based on strategic entry decisions in four dimensions, namely, the entry motive decision, the entry mode decision, the management control decision and the marketing orientation decision. The cases are explored by means of semi-structured interviews of thirty-five senior bank managers based in the local branch in Beijing and/or Shanghai in China. . Four patterns of strategic entry decision are identified through this research. Using pattern-matching techniques of analysis, the research provides evidence to support two research propositions; they are: i) the strategic entry decisions of the multinational banks in China are different. The differences are mainly attributed to the differences of the bank specific resources and the existing strategies of the parent banks; and ii) under the coercively imposed regulatory conditions and the underdeveloped market conditions, the strategic entry decisions of the multinational banks in China have tended to converge. This thesis contributes to existing theoretical, empirical and practice literature. It integrates multiple perspectives in applying the OLI framework. The developed OLI framework both explains and explores the formation of entry strategy of service multinationals. It emphasises the strategic behaviour of the MNB and provides insights to the MNB regarding how to integrate strategic entry decisions with operation and behaviour. It also provides the regulators with the way to assess the impact of regulation on competition structure.
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    The impact of regulation on the UK retail pensions market
    (Cranfield University, 2008-09) Slattery, David; Nellis, Joe
    This thesis presents a longitudinal study of the regulation of the UK retail pensions market. A framework is developed to analyse regulation and regulatory change and to identify the policies and events which may be hypothesised to affect the operation of the market. A provisional model is devised to show the relationships among regulation, the strategic decision-making of market participants and key dimensions of the market (products, prices, demand, distribution channels, costs and industry structure). The empirical evidence shows that over an extended period of time (from the mid-1980s to 2007) regulation affected product development, product pricing, demand, the evolution of distribution channels, producer costs and margins and ultimately the industry structure. The cumulative effect of and interaction among three separate but related public policies shaped the market that is observed in 2008. Over the period since the mid-1980s, the market has been affected more by regulation than by any economic, social or technological change. An evaluation of public policies towards the market shows that policy objectives have not been met and that policies have led to unforeseen and undesirable outcomes. The provisional model is developed to contribute towards the theory of regulated competition. This thesis makes a methodological contribution by developing techniques to assess and evaluate government intervention in a market over the longer term and to consider the interactions between different but related public policy initiatives. An agenda for further research building on this study is proposed. This thesis also makes a contribution to business history in relation to the UK insurance industry. The change in the structure of the industry over the last twenty years is significant in the light of the long history of the industry and the role it has played in the development of retail financial markets in the UK.
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    The influence of the banking sector on central bank independence and inflation control : the of Lebanon between 1985 and 1991
    (Cranfield University, 2008-01) Nasser, Yassar; Nellis, Joe
    A substantial amount of prior research has focused on the relation between Central Bank Independence (CBI) and inflation control. However, this research is mainly theoretical or conducted using cross-country statistical regressions and correlations in the developed world. Little attention has been given to understanding this relation in emerging nations or the influence of interest groups on CBI and inflation in a specific context. This thesis addresses both gaps by conducting an in-depth observation and analysis of this relation in a single country (Lebanon) and the influence of the banking sector on both CBI and inflation during a period of high inflation. This empirical evidence in the case of Lebanon shows that Central Bank Independence from the government – even though abundant and complete – was not enough to control inflation. The influence of the banking sector on both CBI and inflation was more important. This work makes a contribution to knowledge through highlighting the importance of national contexts when evaluating the CBI-inflation relation. Furthermore, this research extends our understanding of the literature and its gaps, and presents a new way to conduct in-depth studies in the field. Finally, it provides practical insights that are of importance to central bankers, especially in emerging nations.
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    Linking monetary and macroprudential policies in the presence of external shocks: the case of Indonesia.
    (Cranfield University, 2019-09) Lubis, Alexander; Alexiou, Constantinos; Nellis, Joe
    The limited experience of practising monetary and macroprudential policies at the same time raises a question about the extent to which a macroprudential instrument - as a complement to monetary policy - affects the macroeconomic stabilisation in emerging markets, particularly in the presence of external shocks. By performing a systematic review of 125 articles, this thesis provides novel and insightful evidence on the interaction between monetary and macroprudential policies in emerging markets by refining what we already know on the extant relationship. It also provides a comprehensive synthesis of the theoretical arguments on the interaction between the two policy expedients. For the first time, we incorporate in our analysis the impact of policies embodied in the payment system - such as the limitation of the value that can be settled through large-value payment systems - hence making new inroads in the respective empirical literature. Further, it makes evident that a shift from currency - to electronic -based payments supports financial intermediation. In addition to that, the study draws insights from the benefits of FX intervention as an instrument in an emerging market that implements an inflation targeting framework. Not only do we model the risk appetite of investors as a shock to the economy but we also take into account households with limited financial access. As a result, it is demonstrated that FX intervention can be employed by policymakers to stabilise an economy during a period of capital flow shocks. Finally, this thesis advances our knowledge by developing a framework - in the emerging market context - to analyse the impact of using reserve requirements combined with FX intervention as key instruments in an inflation-targeting framework. It suggests that reserve requirement can be utilised by policy makers to complement interest rate policy and FX intervention in stabilising the economy during a period of external shocks, particularly a risk appetite shock.
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    On the relationship between fiscal consolidation (austerity) and income inequality. Novel empirical evidence.
    (Cranfield University, 2023-02) Okeke, Angela Ifunanya; Alexiou, Constantinos; Nellis, Joe
    Equity concerns regarding increases and persistence of adverse distributional outcomes tend to rear up during instances of austerity consideration since increasing inequality levels tend to have material significances on a people’s way of life as well as a nation’s economic growth by disproportionately affecting economic opportunities for the lower and median incomes. Motivated by the lack of empirical clarity and conflicting evidence in the extant austerity-inequality nexus literature this thesis enriches our understanding of the effect of fiscal consolidation programmes on output and income inequality. More specifically, by engaging in a systematic literature review, this study explores the relationship between austerity and income inequality. Furthermore, by employing different empirical model specifications1 for a panel of 16 OECD countries for the period 1980 to 2019, this research work explores the dynamic distributional effects of fiscal consolidation programmes as well the role of public debt in determining distributional outcomes during austerity implementation. The novel evidence obtained suggests that: adverse distributional effects persist for 15 years following adjustment implementation through both revenue and expenditure channels; furthermore – point estimates for the Bottom 40% of the income distribution are higher by the 15th year than previous peak periods; distributional impacts arising from influences of public debt levels are amplified during instances of fiscal adjustment with adverse distributional effects on average, manifesting from medium debt levels.