Journal Cover Journal of Indonesian Economy and Business
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  This is an Open Access Journal Open Access journal
   ISSN (Print) 0215-2487 - ISSN (Online) 2085-8272
   Published by Universitas Gadjah Mada Homepage  [27 journals]
  • THE IMPACT OF TRADE ON CHILD LABOR: EVIDENCE FROM SELECTED SAARC AND ASEAN
           COUNTRIES

    • Authors: Rossazana Ab-Rahim, Bilal Tariq
      Pages: 1 - 18
      Abstract: Past studies have tended to investigate the relationship between trade and child labor under the traditional trade theories, while assuming that the trade in homogenous goods and the results show inconclusive evidence of a relationship. Hence, it would be interesting to investigate the trade effects of differentiated goods on child labor in the setting of the new trade theory. This study attempts to investigate the trade-induced child labor effects (selection, scale and technique effects) in selected Asian countries over the period from 1999 to 2013. The countries consist of the major South Asian Association for Regional Cooperation (SAARC) countries, namely: Bangladesh, India, Pakistan, Nepal, and Sri Lanka and selected ASEAN countries, namely: Cambodia, Indonesia, the Philippines, and Thailand, where child labor is most common. The results of this study confirm that the total impact of trade on child labor also needs to account for the selection effect, in addition to the scale and technique effects. The findings imply trade liberalization hampers the child labor market in the context of the trade in differentiated goods.
      PubDate: 2017-09-05
      DOI: 10.22146/jieb.22884
      Issue No: Vol. 31, No. 1 (2017)
       
  • THE IMPACT OF FEMALE DIRECTORS ON FIRM PERFORMANCE: EVIDENCE FROM
           INDONESIA

    • Authors: Triana ., Marwan Asri
      Pages: 19 - 32
      Abstract: This research shows the impact of female directors on firm performance in Indonesia by using as its sample the public companies listed on the Indonesian Stock Exchange (IDX) from 2011 until 2015. There were 347 companies, with 1,735 samples observed. This research uses the multiple regression method. The model is a modified model from 9 recent articles published between 2012 and 2015. The empirical result shows that a female director has a positive significant effect on firm performance. The control variables, consisting of leverage, firm size and firm age have negative significance for firm performance. This research is conducted across 9 sectors of industrial classification, which support the International Finance Corporation (IFC) in increasing the number of female directors in Indonesia. For managers, this research will promote gender development in the boardroom, female executive training programmes as well as female representation on boards of directors. For regulators, this research may provide a contribution to gender representation in board’s policies, rules and regulations. This research can build awareness of women’s contributions to firms and encourage a greater female presence in the boardroom.
      PubDate: 2017-09-05
      DOI: 10.22146/jieb.21994
      Issue No: Vol. 31, No. 1 (2017)
       
  • THE EFFECT OF KNOWLEDGE SOURCES ON INNOVATION CAPABILITIES AMONG
           RESTAURANTS AND CAFÉ BUSINESSES IN INDONESIA

    • Authors: Tri Lestari Wahyuning Utami, Nurul Indarti, Sari Sitalaksmi, Nuraksa Makodian
      Pages: 33 - 50
      Abstract: To conduct innovation, firms absorb and utilise internal and external knowledge. This study examines the effect of internal and external knowledge, in terms of the breadth and depth of knowledge sources, on a firm’s innovation. The breadth of knowledge sources refers to the amount of knowledge sources used within the firm. The depth of knowledge sources is the amount of knowledge sources intensively used by the firm. This study is aimed at answering the following questions. a) What knowledge sources are mainly used' b) What type of innovation is frequently conducted' c) What are the effects of the breadth and the depth of knowledge sources on the innovation capabilities among Indonesian restaurants and cafés' The resource-based view and resource dependency theory are used to understand the role of internal and external knowledge on innovation within a firm.We distributed a semi-structured questionnaire to 101 owners/managers, using a purposive, in several cities in Indonesia, such as Bandung, Denpasar Bogor, Malang, Yogyakarta and other cities in East Java. The results show that the Indonesian restaurants and cafés utilised external knowledge sources more often than internal ones. The firms produce more incremental product innovations than radical ones. The depth of the internal knowledge sources has a positive significant impact on the firms’ innovation capabilities, which supports the previous studies. Meanwhile, the breadth of the internal knowledge sources is found not to have a significant effect on innovation. Additionally, the effects of the breadth and depth of the external knowledge sources on the innovation capabilities are also insignificant.
      PubDate: 2017-09-05
      DOI: 10.22146/jieb.16503
      Issue No: Vol. 31, No. 1 (2017)
       
  • THE ROLE OF CORPORATE GOVERNANCE IN THE EFFECT EARNINGS MANAGEMENT HAS ON
           FIRM VALUE

    • Authors: Surifah .
      Pages: 51 - 69
      Abstract: Previous researchers found that managers have conducted opportunistic earnings management (Abdolmohammadi et al., 2010; Crocker and Slemrod, 2007;Cornett et al., 2009; Jaggi et al., 2009). Corporate Governance (CG) is one of the instruments to overcome, or at least to minimize, earnings management. This research aims to provide empirical evidence about the effect of CG and earnings management on firm value, and the role of CG in the effect earnings management has on firm value. This research is needed, to explain the effectiveness of CG’s implementation by influencing earnings management, in order to lead to more efficient earnings management.This study uses national commercial banks’ data listed on the Indonesian Stock Exchange for the period 2006-2013. The research sample consists of 29 banks over an 8 year period, with a total of232 observations. The research variable consists of the value of the firm, measured by Tobin’s Q as the dependent variable, real activity-based earnings management and accrual-based earnings management as the independent variables and corporate governance, measured by the CG index, as a moderating variable.The results show that the CG index has a robust relationship with performance, controlled by both the ownership concentration’s level and the size of the bank. Corporate governance has positive effects on firm value. The bigger the corporate governance disclosure score is, the higher the market value of the bank becomes. These results indicate that markets respond to the corporate governance’s disclosure, so the company’s market price increases. The results show that the CG index reinforces the positive influence of Accrual-based Earnings Management (AEM) and Real Earnings Management (REM) on the performance. These results indicate that corporate governance practices are able to steer earnings management away from the opportunistic and into the efficiency spectrum.
      PubDate: 2017-09-05
      DOI: 10.22146/jieb.12793
      Issue No: Vol. 31, No. 1 (2017)
       
  • STIGLER’S INFLUENTIAL CONTRIBUTION TO ECONOMIC THOUGHT

    • Authors: Artidiatun Adji
      Pages: 70 - 80
      Abstract: This paper analyzes George J. Stigler’s influential contributions to economic ideas, specifically on industrial structures, the functioning of markets, the causes and effects of public regulation, the economics of information, and on the development of economic thought. Stigler’s most influential contribution to economic thought came in his work on information theory. Treating information as a valuable commodity, he explained why prices differ for identical goods. From his work, many other theories have been built to explain economic behavior. A considerable number of works on decision making under uncertainty could not have progressed without an understanding of the role of information. His swing of the pendulum in economic regulation constitutes a great turnabout. He started research, known as public choice, which assumes that government policy makers are driven by self-interest rather than pure concern for the public’s welfare. His views have now become those of  the mainstream.
      PubDate: 2017-09-05
      DOI: 10.22146/jieb.22981
      Issue No: Vol. 31, No. 1 (2017)
       
 
 
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